Accredited Insurance (Europe) Ltd · DRN-5553287

The complaint Mr C has complained that Accredited Insurance (Europe) Ltd (AIEL) unfairly avoided his car insurance policy (treated it as if it didn’t exist) and refused to deal with his claim following the theft of his car. What happened In April 2023 Mr C bought a car insurance policy with the insurer AIEL. In February 2024 he made a claim following the theft of his car. AIEL rejected his claim as it said he wasn’t the registered keeper of the car when he bought the policy in April 2023. AIEL said if it had known this, it wouldn’t have offered him a policy. Mr C provide a copy of his V5 registration document showing he was updated as the registered keeper of his car in June 2023. He provided evidence to show he had bought the car from his employer in April 2023 and began repayments for it in April 2023. He provided a copy of an email from his employer to him dated 4 April 2023 confirming he was the new owner and from this date he was responsible for any road traffic penalties or fines. The email confirmed that Mr C’s employer was unable to locate the V5, but when it did it would arrange for it to be updated to transfer it to Mr C as the registered keeper. Mr C asked us to look at his complaint. He made a claim for loss of earnings for £6,800 as a result of not having a car. He said he had to borrow £2,500 from his employer to help buy a replacement car. One of our Investigators relied on the Consumer Insurance (Disclosure and Representations) Act 2012 (CIDRA). He looked at the question AIEL asked Mr C about being the registered keeper and owner when he applied for the policy. He thought Mr C hadn’t misrepresented the facts and recommended AIEL re-open and deal with his theft claim, and pay Mr C £1,000 compensation for the distress and inconvenience caused. The Investigator didn’t find there was sufficient evidence to prove loss of earnings by Mr C. AIEL didn’t agree. In summary it says Mr C told it when he made his claim that he was thinking about buying the car for a couple of months (between April and June 2023) and had looked to obtain company car insurance, but it wasn’t an option for him. AIEL says this shows Mr C misrepresented the facts in order to buy the policy. Mr C accepted the Investigator’s view. As AIEL didn’t agree, the case has been passed to me to decide. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. The Consumer Insurance (Disclosure and Representations) Act 2012 (CIDRA) requires consumers to take reasonable care not to make a misrepresentation when taking out a

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consumer insurance contract (a policy). The standard of care is that of a reasonable consumer. And if a consumer fails to do this, the insurer has certain remedies provided the misrepresentation is - what CIDRA describes as - a qualifying misrepresentation. For it to be a qualifying misrepresentation the insurer has to show it would have offered the policy on different terms or not at all if the consumer hadn’t made the misrepresentation. CIDRA sets out a number of considerations for deciding whether the consumer failed to take reasonable care. And the remedy available to the insurer under CIDRA depends on whether the qualifying misrepresentation was deliberate or reckless, or careless. In summary, where a qualifying misrepresentation occurs, and an insurer shows it wouldn’t have offered a policy, it can avoid the policy. Misrepresentation can be categorised as either careless, or deliberate or reckless. The considerations are less favourable for a customer if it is found that the misrepresentation was deliberate or reckless. AIEL has provided a copy letter dated 4 July 2025 which says it sent a refund of premiums to Mr C when it avoided the policy to the inception date. I’ve looked at the key question AIEL asked Mr C when he applied for the policy. It asked; “Are you (or will you be) the owner and registered keeper of the car?” The accompanying guidance note on screen says; “If your name is on the ‘V5 logbook’ then you are the registered keeper” I’ve listened to the key call when Mr C discussed his purchase of the car. Mr C said it was a company car which he bought from his boss in April 2023, he intended to drive it for a couple of months to decide whether to keep it, but he owned it from April 2023. So this is when he bought insurance for it. A copy email dated 2 April 2023 from Mr C’s employer to him confirms the purchase of the car from 4 April 2023, that Mr C was responsible for insuring it and for any fines or penalties from the same date. Mr C’s employer explained that they were unable to locate the V5 logbook and may need to request a new one. I’ve seen satisfactory evidence of the employer’s purchase of the car in 2020. Mr C has provided reasonable evidence to show an agreement from April 2023 to deduct payments from his salary for the purchase of the car by way of an invoice and his bank statement. While I appreciate what AIEL says about Mr C’s comments in this call, the fact remains that the question asked when Mr C applied for the policy was; “Are you (or will you be)” the owner and registered keeper. Mr C became the registered keeper of the vehicle under a V5 logbook in June 2023. As Mr C intended to – and became the registered keeper shortly after purchasing the policy, and has reasonably shown he was the owner when he bought the policy, I don’t find that Mr C misrepresented the facts when he answered this question. And Mr C was still the registered keeper of the car when he made his theft claim.

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I therefore agree with the Investigator’s recommendations to put things right. Mr C has explained the impact AIEL’s decision has had on him. He was without a replacement car for eight months. He needed a car for work, and to take his son to school and back. He is the driver for the family – so not being able to replace his car meant his family all had to use public transport. He says he lost out on a month of work due to not having a car. Mr C has provided an email from his employer confirming that he has loaned Mr C £2,500 towards a replacement car Mr C bought in December 2024, and the impact of not having use of a car in relation to being able to continue to work in the building trade. Putting things right To put things right, I think AIEL should put Mr C back in the position he would have been in had it promptly dealt with his theft claim. This means it will need to deal with his claim as a total loss. AIEL can deduct the refund it paid for the premiums when it avoided his policy from inception from the total loss settlement. AIEL should pay interest on the balance total loss settlement, minus the excess and refunded premium from one month from the date of claim to the date AIEL pays Mr C at a rate of 8% simple interest a year. AIEL should pay Mr C £1,000 compensation for the significant distress and inconvenience caused over a prolonged period of time, and for being without payment to replace his car since March 2024, as we consider a month to settle a claim as reasonable. Mr C’s employer provided an email to this service to say Mr C wasn’t able to attend jobs for 38 days due to not having a car. While it isn’t enough to support Mr C’s claim for lost salary of £6,800, I’ve taken into account the general inconvenience of not having a replacement car has had on Mr C being able to work. I think AIEL should provide Mr C with a letter confirming it avoided his policy in error, so that Mr C can show to his current or future insurers. My final decision My final decision is that I uphold this complaint. I require Accredited Insurance (Europe) Ltd to do the following: • Meet Mr C’s theft claim and pay him a total loss settlement for his car. AIEL can deduct the refunded premium under the avoidance from the settlement along with the excess due. • Pay interest on the claim settlement balance at a rate of 8% simple interest a year from a date one month from the claim to the date of payment. • Provide Mr C with a letter confirming the avoidance was in error and remove any adverse markers in relation to the avoidance in Mr C’s name. • Pay Mr C £1,000 compensation for the distress and inconvenience caused. Accredited Insurance (Europe) Ltd must pay the compensation within 28 days of the date on which we tell it Mr C accepts my final decision. If it pays later than this it must also pay interest on the compensation from the date of my final decision to the date of payment at a simple rate of 8% a year. If Accredited Insurance (Europe) Ltd considers that it’s required by HM Revenue & Customs to withhold income tax from that interest, it should tell Mr C how much it’s taken off. It should also give Mr C a tax deduction certificate if he asks for one, so he can reclaim the tax from

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HM Revenue & Customs if appropriate. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr C to accept or reject my decision before 15 August 2025. Geraldine Newbold Ombudsman

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