Tradex Insurance Company PLC · DRN-6180925

The complaint Mrs P complains about Tradex Insurance Company PLC’s service following a claim on her motor insurance policy when her car was stolen and recovered. In particular she complained that Tradex: • should have deemed the car a total loss rather than repairing it • didn’t manage the repair process well • unfairly refused a claim for the loss of her husband's car key. Mrs P’s policy is branded in the name of the company which administers it but it doesn't handle claims. Tradex is the policy underwriter, which means it is responsible for claims handling. However, it delegates its responsibility for doing so to an agent. But as the agent is acting as Tradex’s representative, within this decision I will refer to the agent’s comments and actions as being Tradex’s. What happened In March 2025 Mrs P’s car was stolen after a thief took her keys from her workplace. The police recovered the car soon after but it had suffered some damage. Tradex arranged for the car to be repaired by one of its approved repairers. Mrs P told Tradex she was concerned that the car had mechanical damage as well as bodywork damage. The repairer identified that it had been misfuelled and would require flushing out. Having done so it told Mrs P the work was completed but an engine management light (EML) lit up almost immediately after she collected the car. The repairer took the car back for further work. But, after Mrs P collected the car the EML light came on again. Mrs P thought that Tradex should have deemed her car a total loss. She also thought that it should have settled her claim for the cost of a replacement car key for her husband’s car which was on her keyring when her own car key was stolen. She complained. In a series of complaint responses Tradex paid Mrs P £250 compensation followed by a further £75 compensation in recognition of the impact of some of the mistakes it had made. But it was satisfied that its decision not to deem the car a total loss and to decline to cover the costs of Mrs P’s husband’s car key was fair. Mrs P brought her complaint to us. Our Investigator recommended it be partly upheld. She said that Tradex should pay Mrs P a further £175 compensation. Tradex didn't accept our Investigator’s complaint assessment. So, as the matter remains unresolved it’s been passed to me to determine. 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.

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Was Tradex’s decision to repair the car fair? Mrs P’s policy allows Tradex to decide how to deal with claims as it sees fit. That’s an extremely common term in motor insurance policies and I don't find it unfair. Although I’d still expect Tradex to apply the term fairly. It’s common for insurers like Tradex to apply a ceiling figure, usually a percentage of the car’s full value, over which it would not authorise repairs and instead deem a car uneconomical to repair – a total loss. In this case, based on the initial estimates it received, Tradex considered that the car would be repairable. I wouldn’t expect an insurer like Tradex to deem a car a total loss where it believed it could repair the car safely and economically. And that was clearly the case here. So, I don't think Tradex did anything wrong in deciding to repair the car. The repair process Soon after the repairer collected Mrs P’s car it was displaying a ‘hybrid system malfunction’ warning light. And the repairer told Mrs P that the car would run but was cutting out. Mrs P told Tradex she was concerned that the repairer was not giving enough attention to the mechanical issues as it had told her the car might only need a long run. But it’s apparent that the mechanical problems persisted. The repairer identified that the car had suffered from a misfuelling and flushed out the relevant components and changed others. The repairer then took the car to one of the manufacturer’s garages. However, Mrs P said that the manufacturer told her that the repairer had simply asked it to recharge the battery and not to do any further investigation. In May 2025 the repairer told Mrs P that her car was ready for collection. She said that the EML illuminated almost immediately and she took the car back to the repairer. After she complained about this Tradex told her that the repairer couldn't carry out ‘diagnostics’ while the car was dismantled but that diagnostics would have been carried out and a quality check completed prior to returning the car. Our Investigator asked Tradex for details of the diagnostics and quality check processes it carried out. In response Tradex told us that it hadn't carried out any engine diagnostics as the existing fault codes had been cleared and there was no need for these. It didn't provide us with specific details of any other diagnostics it had run or what the quality checking process involved or evidence of what that process had revealed before returning the car to Mrs P initially. It follows that, in the absence of the information our Investigator asked for, I can't be certain that the repairer did carry out a thorough and robust quality checking process before returning the car to Mrs P. And if it had done so at an early stage it’s possible that it could have identified the issues with the car sooner and prevented it from being returned to Mrs P prematurely. That said I recognise the issue the car was suffering from only presented intermittently. I say that as, after Mrs P returned the car, the repairer again took it to the manufacturer who thought it was running well. But after returning it to the repairer the EML lit up again. So it does appear that this issue might have been more difficult to identify than simply plugging the car into a diagnostic machine. However, eventually the manufacturer identified that the car would need a replacement of many of its exhaust components. And this fixed the issue. The car was only successfully fixed after the repairer had twice given it back to Mrs P only for the EML light to illuminate again. I can imagine how frustrating this was. And given that Tradex has not demonstrated that it had robustly carried out a quality checking process before returning the car to Mrs P, which would have prevented additional frustration, which lasted many months, I think it needs to take further steps to put things right.

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Tradex has already paid Mrs P £325 compensation in recognition of the impact because some of its service and communication was not up to standard. But I don't think that goes far enough in these circumstances. Mrs P was clearly concerned that the repairer had not given the mechanical issues the attention they might have deserved and the car was returned to her when those plainly hadn't been addressed. To recognise this I think Tradex should pay Mrs P a further £175 compensation bringing the total to £500. I think this sum is reasonable as it's in line with awards we make in other cases of similar seriousness where a business’ errors or service failures have caused considerable distress, upset, worry and inconvenience that needs a lot of extra effort to sort out. Mrs P’s husband’s car key Mrs P explained that she had a key for her husband’s car on the same keyring as her car key which had been taken from her place of work. She thought that Tradex should cover the cost of a replacement. Tradex turned down that claim. The section of Mrs P’s policy that covers the theft of her car specifically says it doesn't cover the cost of replacement keys. There is a separate section covering the cost of replacement locks and keys but this only covers Mrs P’s car not any other car. It’s also worth noting that the key concerned was not stolen from the car itself, it was taken from Mrs P’s workplace. So, it wasn’t a possession inside the car at the time of the theft. Insurance policies are designed to cover specific risks. So they will not cover every eventuality. And it’s for the insurer concerned to decide which risks it wants to cover and the premium it wants to charge for accepting that risk. In these circumstances Mrs P’s policy simply doesn't cover the loss of the key for a different car. So I think Tradex acted fairly in refusing to pay this element of Mrs P’s claim. My final decision For the reasons set out above I partly uphold this complaint. I require Tradex Insurance Company PLC to pay Mrs P further compensation of £175. Under the rules of the Financial Ombudsman Service, I’m required to ask Mrs P to accept or reject my decision before 7 April 2026. Joe Scott Ombudsman

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