Phoenix Life CA Limited · DRN-6227541

The complaint Mr C complains about what Phoenix Life CA Limited did after he made a claim on his critical illness policy. What happened In August 2022 Mr C made a critical illness claim on his policy with Phoenix Life. In January 2023 an adviser told him his claim had been accepted and he had two critical illness policies. She queried whether he wanted both to pay out. Mr C confirmed he did. In March, Phoenix Life told Mr C it had made an error and he only had one critical illness policy. Mr C complained to us. Another Ombudsman issued a final decision on the matter in October 2023. She was satisfied Mr C only had one critical illness policy (and the adviser had made a mistake when speaking to him). She thought the compensation of £500 Phoenix Life agreed to pay (plus interest at 8% simple from the date the claim should have been paid until the date it was) did enough to put things right here. Subsequently Phoenix Life carried out further investigation of Mr C’s complaint. It issued a new final response in May 2024. It agreed to uplift the inflation rate applying to Mr C’s critical illness payment and pay interest on the new amount from the date the claim should have been paid until the date it was. I understand he accepted that and those amounts have been paid. It maintained that telling Mr C he had two critical illness policies was a genuine error. But it accepted that caused him significant trouble and upset. It said it would pay him £2,500. In a further response the following month it increased that to £3,500. Our investigator said he wasn’t able to revisit the outcome of Mr C’s previous complaint on which an Ombudsman had reached a final decision. But he could consider what had happened since then including whether it was fair of Phoenix Life to maintain its position that Mr C only had one critical illness policy (taking into account any new evidence). Having done so he accepted there were internal notes which suggested Phoenix Life thought Mr C did have two critical illness policies. But he thought it likely that resulted from the same mistake the adviser who spoke to Mr C made. He didn’t agree emails from the reinsurer of Mr C’s policy showed they thought two policies were in place. And evidence from the point of sale (which Phoenix Life had now obtained) indicated he’d only taken out one policy. Our investigator did agree Phoenix Life had provided an extremely poor service to Mr C at a point when he was very unwell including not properly reviewing his file when reinvestigating his complaint. But he thought the £3,500 it had now agreed to pay did enough to recognise the impact of that on Mr C. Mr C didn’t agree. • He thought we should review the issues considered as part of his previous complaint and drew attention to shortcomings in the service we’d provided when investigating that. He argued we should take steps to ensure the previous final decision was quashed.

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• The adviser he spoke to in January 2023 was familiar with his claim and the discussion in that call didn’t show she’d wrongly identified an elderly care product as a separate critical illness policy. If that was the case she’d immediately have called back rather than waiting two months to do so. He questioned why, if there was only one policy, he was given quotes that were of a different value. • He thought information Phoenix Life provided from the point of sale had been falsified as it didn’t include a page number or staple marks. And he thought an email from the reinsurer did support his position on there being more than one policy. • After his critical illness policy had paid out his premiums didn’t reduce. He thought that also supported his position he must still have been paying for a further critical illness policy. And he highlighted ongoing confusion in the information he was provided with by Phoenix Life about what cover was actually in place. Our investigator provided a further response to Mr C’s concerns. He didn’t agree with his interpretation of the email from the reinsurer and didn’t think they had commented on how many policies he had. He accepted Phoenix Life had made significant mistakes in the handling of this claim but thought it was more likely system issues which meant it only recently found paperwork from the point of sale. And Mr C’s premiums hadn’t decreased following payment of his critical illness claim because the policies had an investment element which that premium was now funding. He thought Mr C had likely been quoted two different values when he spoke to Phoenix Life because only one had been uprated in line with inflation. Mr C said he’d be responding to those comments but because of personal issues asked for more time to do so. As he hadn’t responded by 6 March (a month after the original deadline) our investigator confirmed he would refer the case to an Ombudsman. He asked Mr C and Phoenix Life to provide any further comments by 13 March. Neither party has provided any further submissions. So I need to reach a final decision. 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. It’s clear from the information I’ve reviewed what an exceptionally difficult experience this has been for Mr C. I was very sorry to learn of the challenges he’s faced and those that continue to affect him. In response to our investigator’s further comments Mr C requested more time to respond. We haven’t received any comments by the further deadline our investigator gave. So I’ve thought about whether it’s fair for me to now reach a decision on this complaint. I’ve taken into account that our investigator issued his view in November 2025 and a further response on 23 January 2026 (over two months ago). I appreciate the impact of Mr C’s ongoing health issues but I think he’s been given a fair opportunity to provide any further comments to us. He’s also outlined his thinking in the comments he previously made. I think I have the information I need to reach a decision on his complaint and it’s appropriate for me to do so. However, while Mr C feels we should revisit issues considered as part of his previous complaint that isn’t something I can do in this decision. Our statutory responsibility is to determine complaints. Once a determination (a final decision) has been issued by an Ombudsman that role is at an end. And Phoenix Life’s previous outcome has been reviewed by another Ombudsman who issued a final decision in October 2023.

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A final decision from an Ombudsman brings our complaint handling process to a close and there’s no internal mechanism available to me (or anyone else at our Service) which would overturn that decision. I appreciate Mr C has concerns about how his previous complaint was handled but those have already been reviewed through our separate complaints process (which doesn’t consider the merits of a complaint). So I’m only considering here the matters Phoenix Life covered in the final response letter it issued in May 2024 (and further response in June 2024). The key issues are whether it acted fairly and reasonably in maintaining (following reinvestigation) that Mr C had only taken out one critical illness policy and whether the compensation it’s now offered does enough to recognise the impact on him of what it got wrong. There’s no dispute that during his call with Phoenix Life in January 2023 Mr C was given two separate figures for critical illness policies that would pay out. Phoenix Life’s position is that he only has one critical illness policy alongside other covers which include ‘Elderly Care Benefit’. But at the point of the call its systems displayed ‘Elderly Care Benefit’ as a critical illness cover. And it was only if the adviser went into the detail of that the system would show what it actually was. It was because that didn’t happen (potentially because the claim was being handled by staff unfamiliar with this type of product) that Mr C was given inaccurate information about the cover that would be provided. Mr C says the adviser he spoke to was familiar with his claim and the discussion didn’t suggest she had wrongly identified ‘Elderly Care Benefit’. And he queried why different values were given for the amount he’d receive. If Phoenix Life was correct to say ‘Elderly Care Benefit’ was being referenced the amount to be paid for each claim would be the same. I’ve listened to the call between Mr C and the adviser. It does appear she’d had a previous conversation with Mr C and I recognise she thought he had both standalone and prepayment cover for critical illness. But the adviser didn’t appear very clear at all about the extent of the cover Mr C had and in particular was confused about the position with ‘Elderly Care Benefit’ when Mr C queried that. I don’t think the discussion in this call does evidence the adviser was correct in what she said about Mr C having two policies. I do think Mr C makes a reasonable point that if there was no separate critical illness policy (and the adviser had confused that with ‘Elderly Care Benefit’) the figures quoted would have been the same. But I think it’s also plausible (as our investigator suggested) that the difference is because one figure has been uprated in line with inflation and the other hasn’t; the numbers do correlate with that being the case. Mr C has referenced an email from the reinsurer of this policy which he says supports his position that there were two policies. I’ve read that full email chain. The reinsurer initially asked for the original application and paperwork relating to Mr C’s policy but as that wasn’t available agreed to make payment in any case. Phoenix Life queried whether that agreement covered the second policy it (at that point) believed Mr C held. The reinsurer said it didn’t have details of a second policy and the premiums didn’t cover this. I don’t think these emails do support there being two policies. I also think those discussions with the reinsurer are the reason Mr C wasn’t immediately told Phoenix Life was in error following his January 2023 call with it. It was only on review of that information it appears to have realised there was a problem here (and what that was). And I think Phoenix Life has provided a reasonable explanation as to why Mr C’s premiums didn’t reduce after his critical illness policy paid out (because those amounts were apportioned to the investment element of his policy).

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Mr C has highlighted a further call with Phoenix Life in October 2023 in which he was again told he had two critical illness policies. I’ve listened to that call. The adviser does say she can see two figures for critical illness on her system. But she goes on to explain she’s not sure of the reason for that and it’s potentially because of a computer error. I think that actually supports Phoenix Life’s position that it was the lack of clarity in the way information was displayed by its systems which led to Mr C being given inaccurate information about what cover he had. In any event regardless of what happened in the January 2023 call and subsequently the wider point is whether the other evidence supports that Mr C did initially take out two critical illness policies. I understand as part of their reinvestigation of the complaint Phoenix Life obtained further information from the point of sale which they provided to Mr C. And while I accept this is limited I don’t think it was unreasonable of Phoenix Life to conclude this didn’t show he had two policies. The advice letter from the time identifies Mr C’s needs and the amount of protection he requires and recommends cover for that. That’s the amount which is then listed as being provided by a standalone critical illness policy on a ‘Benefit Summary’. It appears that amount was then amended because a further summary was prepared the following year which had a lower amount requiring protection. Both documents say Mr C hadn’t taken out a separate prepayment critical health policy (and reference the same policy number). And I think it makes sense he wouldn’t have done so because the cover he did take appears to have met his needs as identified by the adviser. Mr C believes Phoenix Life has falsified some of this information. I recognise it’s taken time for it to be provided. But there’s nothing about this evidence that clearly suggests to me it doesn’t date from the point of sale. And I don’t think it’s surprising it would have taken Phoenix Life time to retrieve information which dates back over 25 years (particularly given the acknowledged issues with its systems). That information also matches with Mr C’s own recollections; when he spoke to Phoenix Life in January 2023 he believed he only had one critical illness policy and was shocked when the adviser told him otherwise. Taking all of that into account I think it was reasonable of Phoenix Life to remain of the view that Mr C only took out one critical illness policy. And it was the information its systems displayed which led its adviser to inaccurately say there were two. But clearly that shouldn’t have happened and there’s no doubt being given that inaccurate information has caused Mr C a great deal of distress. He says he started making plans on the basis of the higher figure he was initially given only to then have those dashed a few months later. And he then had to put avoidable time and effort into trying to understand what happened at a point when he was very unwell and understandably would have wanted to focus on his health. It also appears there were issues when Phoenix Life then reinvestigated his concerns as it doesn’t appear his file was properly reviewed by one of the individuals considering it. However, Phoenix Life has now offered to pay Mr C £3,500 in recognition of the impact on him of what it got wrong. I do accept those failings caused Mr C sustained distress and put him to significant avoidable time in pursuing this matter. But I think that figure does enough to recognise the impact on him of what Phoenix Life got wrong. My final decision Phoenix Life CA Limited has already made an offer to pay £3,500 to settle the complaint and I think this offer is fair in all the circumstances. So my decision is that Phoenix Life should pay Mr C £3,500.Under the rules of the Financial Ombudsman Service, I’m required to ask Mr C to accept or reject my decision before 22

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April 2026. James Park Ombudsman

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