Wedding insurance, and insurance for other types of events, are usually specific stand-alone insurance policies taken out to cover risks relating to the event in question. We typically hear from customers after they have made a claim. They contact us because they feel their claim has not been handled properly or has been rejected unreasonably.
The policies might cover the period in the run-up to the event, or the event itself – for example, cancellation or abandonment of the event; or property damage or legal liability relating to the event.
Types of complaint we see
We see a range of complaints about wedding or special event insurance. Many of the complaints we see relate to the type or level of cover that exists where someone has had to cancel or rearrange their wedding - recently, where they have done so due to government measures imposed in response to the pandemic.
Customers may complain that:
- They’ve been sold a policy that was unsuitable for them
- They weren’t made aware of a key aspect of the policy.
- Their claim has been unfairly declined
- Their claim has not been handled in a timely manner
- The amount offered to settle their claim is not correct
Handling a complaint like this
When you receive a complaint, you should reply to your customer within the relevant time limits.
If you don’t reply within the time limits, or the customer disagrees with your response, they can bring their complaint to us. We’ll check it’s something we can deal with, and if it is, we’ll investigate.
We’ll expect you to be able to show us that you’ve investigated the complaint thoroughly and have reflected carefully on the circumstances of the events.
What we look at
As with every case, in reaching a decision about what’s fair and reasonable, we consider:
- the relevant law and regulations
- any regulator’s rules and guidance that applied at the time
- any industry codes of conduct in force at the time
- what we consider was good industry practice at the time
If there are disagreements about the facts, we’ll make our decision about what using evidence provided by you, your customer and relevant third parties.
The majority of complaints we’re seeing relate to what cover exists where someone has had to cancel or rearrange their wedding due to government measures imposed in response to the pandemic. Most commonly, weddings were affected if the venue had been told to close, or if a member of the wedding party had been advised to shield.
When we consider a complaint, we’ll consider what’s fair and reasonable taking into account all of the circumstances – in particular the unprecedented situation created by the pandemic. We expect any insurer to remember its duties to deal with claims promptly and fairly, and not to reject a claim unreasonably.
We’ve noted that the cover available under these policies often includes cancellations as a result of the venue being unable to hold the wedding due to an outbreak of disease, or closure of the venue by the relevant authority. They also tend to cover cancellations as a result of the death, injury or sickness of the marrying couple or a relative which would make continuance of the wedding inappropriate.
Our approach recognises that the terms we’ve seen don’t specify that the outbreak of disease needs to be specific to the venue, or that the venue closure needs to result from something that happened at the venue. And we consider that an order to close from any authority with the power to issue a closure direction, including the government, would fall under the scope of cover.
Some policies we’ve seen exclude claims arising directly or indirectly from a government regulation or act. There was no government act or regulation in force prior to 21 March 2020, so this is more likely to be relevant to weddings that were cancelled after that date.
We note that any power a relevant authority has to close a venue is likely to be derived, directly or indirectly, from a government regulation or act. And we don’t think it would be fair for the exclusion to be applied in a way that would nullify cover for an insured event entirely. As such, we’ve said insurers can’t fairly rely on an exclusion like this if the other terms of the policy have been met.
We acknowledge that if someone was physically well enough to attend the wedding, but had been asked to shield, then strictly speaking, the wedding wasn’t cancelled due to sickness. But we’d still expect insurers to apply the terms fairly. If someone received advice to shield because they were clinically vulnerable, they were incapable of attending the wedding due to their health.
So, where continuance of the wedding would have been inappropriate without that person, we’d likely say cover should apply on a fair and reasonable basis.
We’ve also seen disputes about:
- Claims being declined based on an exclusion for claims arising from their financial circumstances (eg where people lost work due to the pandemic).
- Policies not covering an inability to travel (to a foreign wedding in a country with travel restrictions for example) unless due to adverse weather or natural catastrophe.
- Whether insurers should extend policies to cover re-arranged weddings, and if so, for how long.
- General customer service issues and claims handling delays.
Our starting point will be to look at the policy wording and any other relevant documentation, such as the policy summary.
Wedding insurance will often only cover the cancellation of a wedding if it arose from one of the events listed in the policy terms. Examples might include the venue being damaged by a fire, the death of a close relative or at least half of the guests not being able to reach the wedding due to adverse weather conditions.
Other policies will cover cancellation so long as it’s unforeseen, unavoidable and beyond the customer’s control (unless an exclusion applies).
In the first instance, when the customer contacts you about their claim, they will need to demonstrate, on balance, that their loss is covered, for example by providing evidence to show why the wedding was cancelled.
All policies will include a list of circumstances that are excluded from cover. One example might be if someone decides not to go through with the marriage. And limitations may be placed on the amount that will be paid out in the event a claim. We’d expect any significant or unusual exclusions to have been highlighted to the customer at the point of sale (in a policy summary, for example).
Once a customer has been able to show they have a loss that the policy covers, it’s up to you to either pay the claim, demonstrate that an exclusion applies, or demonstrate that a condition of the policy has been breached (in a way that was material to the loss).
We’d also think about what’s fair and reasonable. In a Covid-19 related claim, for example, there might be many reasons a wedding was cancelled, some of which are covered, some of which aren’t and some of which are excluded. What’s fair will depend on the individual circumstances.
Disputes can sometimes arise over the settlement of accepted claims. It’s usually a requirement of wedding insurance that only costs that are irrecoverable will be covered. So, the customer will have to show they’ve tried to get their money back from the venue and their suppliers.
These complaints often arise once a claim has been declined. Customers may say they weren’t told about the exclusion you relied on to decline the claim. Or, in the event of a successful claim, they may say they weren’t made aware of a limitation on cover which has meant they aren’t recovering their loss in full.
How we approach these complaints will depend on whether advice was given.
If it wasn’t, we’d still expect the customer to have been given enough clear information to have enabled them to make an informed decision about whether to buy the policy. And any significant or unusual features of the policy should have been drawn to their attention. If advice was given, we’d expect to see that consideration was given to the customer’s demands and needs, and that any advice was suitable.
Where two complaints are brought to us simultaneously about a claim and the sale of a policy, we’d generally investigate the claim first before considering the sale.
Putting things right
If we decide you’ve treated the customer unfairly, or have made a mistake, we’ll ask you to put things right. Our general approach is that the customer should be put back in the position they would have been in if the problem hadn’t happened. We may also ask you to compensate them for any distress or inconvenience they’ve experienced as a result of the problem.
The exact details of how we’ll ask you to put things right will depend on the nature of the complaint, and how the customer lost out. The following examples give an idea of our approach.
If we think a claim has been declined unfairly, we’d usually ask you to reconsider the claim setting aside the reason you originally relied on to decline it. If it’s clear that, setting aside the reason you originally relied on to decline the claim, it would have been covered, we’d probably ask you to pay the claim in line with the remaining terms and conditions.
Where a customer has been out of pocket (for example where they paid costs to the venue and suppliers that should since have been reimbursed under the policy terms), we’d recommend that interest is added to any settlement, using a rate of 8% annual simple interest as a starting point (although we may use a different rate if, for example, the customer used a credit facility).
If we think the customer wouldn’t have gone ahead with the policy had it been sold fairly, we may ask you to refund their premiums with interest.
In some circumstances, we might find that the customer would have acted differently had their policy been sold correctly (for example, by taking a different policy that would have covered their loss). In that scenario, we’ll ask you to put the customer in the position they would likely have been in but for the mis-sale of the policy.
We may consider asking you to pay compensation if we think a claim was handled in a way that caused avoidable distress or inconvenience to your customer. We’ll consider that you have an obligation to handle all claims promptly and fairly, to update the customer on a claim’s progress, and not to reject a claim unreasonably. The amount of compensation will depend on what impact your errors had on the customer.
Jack and Sarah’s wedding was cancelled by their venue due to Covid-19
Wedding insurance Covid-19
Ben and Selena took out a policy with an insurer to cover wedding cancellation costs
Business Support Hub
If you want to talk informally about a complaint you’ve received, you can speak to our Business Support Hub. Our Business Support Hub can give general information on how the ombudsman might look at a particular complaint. We also offer guidance on our rules and how we work.
Find out how to contact the Business Support Hub.
Information for consumers
If you’re a consumer looking for information on complaints about wedding or special event insurance, you can read more about this on our dedicated information page for consumers or to make a complaint, find out more about how to complain.