Anthony, a landlord, bought a home emergency policy to cover his rental property. But he wasn’t eligible to use it and complained to us about this.
What happened
Anthony is a landlord. He bought a home emergency policy to cover his rental property. Later, he tried to claim for a broken boiler. The insurer rejected his claim. They said Anthony’s policy didn’t cover rental properties.
Anthony said this was unfair because it wasn’t made clear to him that landlords weren’t covered when he bought the policy. He felt the policy had been mis-sold, so he complained. The insurer disagreed. They said in its final response Andrew had been given all the policy documents, as well as 14 days to change his mind after he bought the policy, and that if he’s unhappy with the outcome of his complaint to contact the Financial Ombudsman Service.
What we said
First we looked at the policy documents to see if Anthony’s claim could have been covered. We found that the policy didn’t cover landlords at all. We thought the policy not covering landlords was significant and should have been highlighted to Anthony when he bought the policy.
We asked for a copy of the:
- sales call recording
- sales script
- policy documents
We listened to the call recording. The policy term about landlords wasn’t highlighted to Anthony during the call. We saw the sales script. It had a section advising the agent to run through significant or unusual exclusions or limitations.
The term about landlords was only mentioned once in the policy documents and it wasn't highlighted or prominent.
Although the policy document had the relevant term in it, we didn’t think it was highlighted enough because it was at the end. We thought that the policy had been mis-sold. We considered what Anthony would have done if the restriction had been highlighted. We were satisfied that he wouldn’t have bought the policy because it didn’t cover rental properties. So we asked the insurer to refund Anthony’s premiums plus 8% interest.
Anthony had the emergency issue resolved by a friend meaning he didn't need to recover costs by making a claim, which meant that a refund of his premiums was fair and reasonable.
When he bought the policy Anthony didn’t mention that he was a landlord and needed cover for a rental property. If he had mentioned this, we might have taken a firmer approach with the insurer.