Insurance company pays out €4k to woman after initially refusing to payout
An Irish Insurance company has paid out €4k to woman after initially refusing to pay out on the crash claim over a technicality
The Financial Services Ombudsman’s office said that there were 1,914 complaints about insurance in 2017 alone.
This reported incident sees an insurance company refusing to pay a woman’s claim after an accident because she told them in her claim form that she was unemployed.
The woman had previously listed her occupation as ‘gardener’ but subsequently became unemployed at the time of her policy renewal. When it came time for her to renew her policy she may not have informed the insurance company that she was unemployed. This oversight, it would seem, was a chance for the insurance company to find a clause to refuse payment to a policyholder for the omission of important information.
When asked at the renewal time, what her occupation was, she told the company that she was a gardener.
Following an accident, she submitted a claim in which she stated that she was unemployed. The provider declined the claim on the grounds that she had not disclosed that she was unemployed at the time of renewal.
The woman claimed that the information she provided upon renewal was accurate, as she had been working as a gardener in the community on a voluntary basis, and that she had provided the information in the interests of full disclosure.
During mediation facilitated by the Ombudsman’s office, the insurance company finally agreed to process her claim and subsequently paid her over €4,000.
Complaints about insurance products and services accounted for 42% of all complaints received in 2017. Similar to 2016, motor insurance was the main product type complained about, representing 33% of insurance complaints.
The report contained another example of a woman whose car insurance was cancelled because she failed to disclose a certain piece of information when she was applying for her policy.
The non-disclosure related to whether or not she had been involved in an accident – regardless of blame in the past three years. As a result of the cancellation, she struggled to afford insurance premiums, and it negatively affected her business.
The insurance company decided to rescind the cancellation of the policy on the basis that the woman may not have fully understood the questions because English was not her first language.
She also received a refund of the premium loading applied during the period in question. Although this was not a large sum, the woman felt this was a significant result as it provided financial freedom and the ability to shop around for new cover.
The Ombudsman, Ger Deering has expressed concern about insurance companies refusing claims and cancelling customers’ policies because of minor non-disclosures.
In many of these cases, companies are asking “vague questions” and leaving it to the consumer to decide whether something is a material issue.
“I would say that consumers need to be very careful about the kind of questions they’re being asked and answer them correctly and providers need to ask the questions in a clear manner that is understandable,”
Justin Kavanagh is a recognised leader in automotive intelligence and vehicle data supply to the entire motor industry. He has almost 20 years experience in building systems from the ground up. As the Managing Director of Vehicle Management System, he understands the need and importance of trustworthy and reliable vehicle history and advice to both the trade and the public.
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