Accredited Insurance (Europe) Ltd · DRN-6232578

The complaint Mr F complained because Accredited Insurance (Europe) Ltd cancelled his home insurance policy and declined his claim. What happened Mr F’s policy renewed on 1 June 2024. Accredited based its decisions whether to offer the policy and what premium to charge on various facts. As part of the renewal process Mr F confirmed these facts were correct. Regarding the occupancy of the property he said: • the property wasn’t let or sub-let (other than family members) • there weren’t any non-family lodgers • the property was regularly occupied day and night • the maximum time the property would be unoccupied for would be 60 days or less • the property was his main home • the property wasn’t used for business purposes • there were two adults and one child living in the property. On 11 June 2024 Mr F’s brother-in-law (who I’ll refer to as “Mr J”) moved into the property. On 14 June 2024 Mr F departed the UK on an extended worldwide holiday, with no indicated return date. At this point Mr F’s son was also overseas on an educational placement. He was due to return home in February 2025. On 21 December 2024 Mr J left the property for the Christmas period and to then go on holiday. On 17 January 2025 he was notified by a neighbour that there’d been a major leak at the property. Mr F, who was still overseas, arranged for an emergency plumber to attend the property to identify and repair the leak. A claim was then made to Accredited. Accredited cancelled the policy with effect from 14 June 2024, which had the effect of the policy not being in force when the damage occurred. It therefore also declined the claim. It felt Mr F had breached a policy condition that required him to tell it about any change in his circumstances. It said if it had known that the property wasn’t going to be occupied by Mr F and his family from 14 June 2024 it wouldn’t have continued offering cover. Mr F complained to Accredited about its decision but Accredited maintained its position. It changed its reasoning slightly though because it now referred to Mr F misrepresenting the true position at the renewal of the policy (rather than him breaching the policy condition). Our investigator concluded that the complaint should be upheld. This was because, in summary, she didn’t feel there had been a misrepresentation by Mr F at the renewal of the policy. Accredited disagreed and asked for an ombudsman to review things. It confirmed its decision was based on the occupancy of the property rather than the property being unoccupied. In that regard, it said Mr F wasn’t living at the property for virtually the whole year of the policy (he returned to the UK in June 2025). And it referred to:

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• Mr F confirming at the renewal that there weren’t any non-family lodgers at the property (it said Mr J didn’t fall within the definition of ‘family’), and • the policy condition requiring Mr F to tell it about any change in circumstances. What I provisionally decided – and why I issued a provisional decision which explained why I thought the complaint should be upheld. The relevant parts of my provisional decision are outlined below, and form part of this final decision. Misrepresentation at the renewal of a policy is a completely different concept to breaching a condition requiring a policyholder to tell an insurer about any changes in circumstances, so I commented on them separately. Misrepresentation • Misrepresentation could only have occurred at the start or renewal of the policy. Things might of course have changed after the policy started or renewed, which might mean what was disclosed at the start or renewal of the policy became inaccurate, but that’s why Accredited inserted the ‘change in risk’ condition into the policy. • I didn’t think Accredited had any grounds to cancel Mr F’s policy or decline his claim because of a misrepresentation at the renewal of the policy. That was because I didn’t think there was any misrepresentation by Mr F at that time – because on 1 June 2024: o the property wasn’t let or sub-let and there weren’t any non-family lodgers living there o the property was regularly occupied day and night and it wouldn’t be unoccupied for more than 60 days o the property was Mr F’s main home o the property wasn’t used for business purposes o there were two adults and one child living in the property (albeit Mr F’s son was away at the time). • I accepted that on 1 June 2024 there were most likely plans afoot (a) for Mr F and his wife to be away from the property for an unknown period of time while they were on holiday and (b) for Mr J to live in the property. But Mr F wasn’t asked as part of the renewal process if any fact he’d confirmed to be true as at 1 June 2024 was likely to change during the period of insurance. • Accordingly, I concluded that Accredited’s misrepresentation argument fell at the first hurdle because it hadn’t shown that Mr F misrepresented the situation – based on the facts he was asked to confirm – as at 1 June 2024. • Even if there had been a misrepresentation that fulfilled all the relevant criteria under the Consumer Insurance (Disclosure and Representations) Act 2012, or “CIDRA” as it’s often referred to (which is the law that underpins misrepresentation), I pointed out that cancelling Mr F’s policy with effect from 14 June 2024 wasn’t a remedy that was available to Accredited. The only remedy available would have been to void the policy from 1 June 2024 (the renewal date) – which was an entirely different situation to cancelling it from 14 June 2024. Breach of condition

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• The policy said: “You must tell us as soon as possible if there are any changes to any of the details you have provided us with as this could affect your insurance cover. Your statement of fact will show the information you have provided us with. Examples of these changes are … (b) if someone lives in the home other than you or your family … (k) if any of the information provided in the statement of fact has changed”. • ‘Family’ was defined in the policy as “[Mr F and his] … relatives … who permanently live with [him]”. • Given the definition of ‘family’, I thought a key point was whether Mr F continued to ‘live’ in the property even though he was on an extended holiday. This was because if he didn’t, then irrespective of whether Mr J permanently lived at the property or not, Mr J wouldn’t have been living with Mr F. • I hadn’t seen anything to suggest that Mr F intended to emigrate elsewhere or to remain away from the property forever. His holiday was longer than most, but it was still a holiday. In my view, if a consumer goes on holiday – even for an extended period – it was unreasonable to say that while they’re on holiday they no longer live at their home address. Saying that would effectively be the same as saying that they’d moved to their holiday destination and were now living there – which I thought was nonsense. To illustrate the point, if Mr F was asked, say, nine months into his holiday where he lived, I thought it would be acceptable and reasonable if he’d answered that he lived at his home address in the UK. • So, in terms of where Mr F lived, I didn’t think him being on holiday for 12 months or so meant that he no longer lived at his home address. It would be unreasonable to say that he was living (for example) in Mexico for four weeks, the Philippines for another few weeks, New Zealand for a few more weeks etc. Rather, he lived at the insured property but was temporarily staying in those other places while he was on holiday. • I accepted that insurers didn’t want to provide cover for properties that were empty for extended periods. But that was why they inserted unoccupancy exclusions into policies to limit the risk they’re taking on. The unoccupancy exclusion in Mr F’s policy wasn’t relevant here though because Accredited wasn’t relying on it to decline the claim. • Accordingly, for the reasons above, I thought it was fair to conclude that Mr F continued to live at the insured address, even though he didn’t stay there for an extended period. • So how did this affect whether Mr F breached the policy condition? First, he had to tell Accredited if someone lived in the home other than him or his family. As above, family included: o a relative o who permanently lived with Mr F. • A brother-in-law is a relative so Mr J was Mr F’s relative – indeed, it appeared this wasn’t disputed by Accredited. However, Accredited argued that Mr J wasn’t permanently living in the property and had no intention of doing so.

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• I first considered what a reasonable definition of ‘permanent’ was. A general definition I’d seen referred to it meaning something that would last or remain unchanged indefinitely. And ‘indefinitely’ in turn meant that a position would continue with no fixed time limit, possibly forever or until a future decision is made. I didn’t think permanent meaning something akin to forever made sense in terms of the policy definition – because that would mean Mr F’s son needed to live with Mr F for the rest of his life to be classed as Mr F’s family. I wasn’t persuaded that was reasonable, or that it was Accredited’s intention when it drafted the policy. • With the above in mind, I thought it was reasonable to conclude that ‘permanent’ in terms of the policy definition meant something akin to a situation that would last or remain unchanged with no fixed time limit until a future decision was made. I thought that fit in with the situation I’d described with Mr F’s son ie he would remain living with Mr F, with no fixed time limit on that agreement, until he decided to move out and live elsewhere (or until Mr F decided the time had come for his son to move out). • As part of its investigation into the claim Accredited obtained a statement from Mr J which, amongst other things, outlined his living arrangements prior to and at the time of the claim. He said: o he owned another property with his partner, which they lived in from December 2021 to June 2024 o he’d been in a relationship with his partner for 15+ years, but at times they’d found it difficult to live together and there had been periods where they’d lived apart o in early 2024 they were finding it difficult to live with each other so he asked his sister if he could move in with her and Mr F – this was agreed but due to Mr J’s health it wasn’t possible at the time o it was later agreed he would move into the insured property in June 2024 o he didn’t move into the insured property to look after it while Mr F and his wife were away – he considered that from June 2024 he lived there o it was agreed that while Mr F was away he wouldn’t pay any rent but he would pay £712 a month to cover bills o he moved his personal possessions from his property to the insured property o although he now lived at the insured property he would sometimes return and stay with his partner, and she would sometimes stay with him at the insured property. • I hadn’t seen any statements or similar that Accredited took from Mr F. But he’d told us there had been conversations since February 2024 about Mr J living with him but there wasn’t any confirmation that he was going to do so until after the policy renewed. • It’s unusual – but not unheard of – for two people in a long-term relationship to live apart from one another. I didn’t think it was unusual for someone with those living arrangements to occasionally stay with their partner. • In my view, the circumstances Mr F and Mr J described fitted squarely within what I’d decided was a reasonable definition of permanent. Mr J had effectively moved out of the property he co-owned with his partner and had moved into Mr F’s property. I hadn’t seen anything which showed there was a fixed period of time that had been agreed for this arrangement. So the living arrangement or agreement was in place for the foreseeable future and until Mr F or Mr J made a future decision.

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• So, for the reasons outlined above, I concluded that Mr J fell within the policy definition of family. This was because (a) he was Mr F’s relative, and (b) he permanently lived with Mr F. • Accordingly, as Mr F only had to tell Accredited if someone other than him or his family lived in the home, he didn’t have to tell it that Mr J was living there. • Accredited raised two points which it felt called into question whether Mr J was really living in the property. First, it questioned why, if he was living in the property, was it necessary for neighbours to hold keys so they could check on the house and deal with post. Second, it said Mr J hadn’t officially changed his address eg on his driver’s license or his GP. • I couldn’t really see a need for a neighbour to check on the property if Mr J was living there. However, Mr F told us his wife’s best friend dealt with their post due to health conditions she hadn’t shared with Mr J. I could also understand why Accredited might be concerned that Mr J hadn’t formally changed his address despite the fact he now lived elsewhere. However, it wasn’t as if he didn’t have any links to his previous address – he did still co-own the property after all. I thought the points Accredited raised were relevant. But I wasn’t persuaded they were sufficient for me to reach a different conclusion on where Mr J lived. • Mr F also had to tell Accredited if any of the information provided in the statement of fact had changed. Apart from the number of adults living in the property (which Accredited hadn’t shown would have led to it not continuing to provide cover), I wasn’t persuaded that any of the information in the statement of fact changed. This was because it remained that: o the property wasn’t let or sublet and there weren’t any non-family lodgers living there o the property was regularly occupied day and night and wouldn’t be unoccupied for more than 60 days o the property was Mr F’s main home o the property wasn’t used for business purposes. • So for the above reasons, I concluded that Mr F didn’t breach the policy condition. Summary For the reasons outlined above, I concluded that: • there wasn’t any misrepresentation at the renewal of the policy • Mr F didn’t breach the policy condition requiring him to tell Accredited about any change in circumstances. Accordingly, I concluded that it was unfair for Accredited to have cancelled the policy and rejected the claim on these bases. Putting things right In terms of the policy and the claim, to put things right I thought Accredited should:

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• reinstate the policy and settle Mr F’s claim subject to the remaining terms and conditions [NB – if Mr F no longer wishes to be insured with Accredited the policy can simply be treated as lapsed from the June 2025 renewal date] • add interest at a rate of 8% simple to any claim settlement paid directly to Mr F for any costs he’d already incurred, calculated from the date Mr F incurred the cost to the date of settlement • add interest at a rate of 8% simple to any claim settlement paid directly to Mr F for any repair/replacement costs he hadn’t yet incurred, calculated from the date of the claim to the date of settlement [NB – Accredited might decide to use its approved contractors or suppliers to settle all or some of the outstanding claim, which would mean this aspect of the settlement would fall away]. Accredited could deduct any premium it refunded to Mr F upon cancellation of the policy from any claim settlement. In addition, I thought Accredited should pay Mr F compensation for the distress and inconvenience caused. This was a claim for major damage caused to Mr F’s home. So even if Accredited hadn’t unfairly cancelled the policy it would have taken some time to settle the claim. And for the first six months or so Mr F was on holiday so the inconvenience caused to him was reduced. Nevertheless, had things run smoothly I didn’t think it should have taken Accredited more than six to nine months to fully settle the claim. That would have meant most of the repair work ought to have been finished around the time, or shortly after, Mr F returned from his holiday. Instead, Mr F had to arrange some of the repairs himself and had to live in the unrepaired property longer than he should have. Further, this was a major claim in terms of the repair costs – estimated by the loss adjuster to be over £150,000. So Mr F had the significant worry of potentially having to finance the repair since the claim was declined in April 2025. Our investigator suggested that Accredited pay Mr F £200 compensation for the distress and inconvenience it caused. I usually consider compensation between £100 and £300 suitable where there were repeated small errors, or a larger single mistake, requiring reasonable effort by the consumer to sort out. Typically, the business’s actions would result in some acute stress lasting hours at the lower end, or a milder impact across a few days or even weeks at the higher end. I thought Mr F’s suffering was far more than this. In my view, the repairs not being completed and the prospect of having to pay around £150,000 to repair his home to its pre-incident condition would have caused Mr F sustained distress and severe disruption to his daily life. In my view, fairer compensation for this suffering was £2,500. So, in addition to the claim settlement, to put things right I thought Accredited should pay Mr F £2,500 compensation for the distress and inconvenience caused. Responses to my provisional decision Mr F had some general questions (which our investigator answered) but he didn’t make any comments in respect of my findings. Accredited disagreed with my provisional decision and made various points – which I discuss below.

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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 allegation that Mr F failed to disclose a material fact because he didn’t take reasonable care to not make a misrepresentation is an entirely different concept to the allegation that he breached the policy condition requiring him to notify Accredited of any changes in circumstances after the policy renewed. I therefore remain of the view that it’s appropriate to consider them separately. Misrepresentation In summary, Accredited said in response to my provisional decision: • Mr F knew at the renewal of his policy that he would soon be going on an extended overseas holiday so wouldn’t be in the UK • therefore, he knew that his representation about his living arrangements would cease to be true almost immediately • Mr F’s failure to disclose his known plans at renewal and, therefore, that the information he provided would soon be untrue was a failure under CIDRA to take reasonable care not to make a misrepresentation. I find it interesting that on the one hand Accredited continues to outline what Mr F’s obligations were under CIDRA but on the other hand failed to recognise or comment on the fact that it breached CIDRA by cancelling the policy from 14 June 2024 (which wasn’t a remedy available to it). Accredited can’t “pick and choose” what parts of CIDRA it wants to take account of – if it’s going to rely on CIDRA then it can only avail itself to the remedies set out in CIDRA. It appears to me that Accredited has combined the two concepts by arguing misrepresentation (at least in part) but then applying a breach of condition remedy. In my view, if Accredited truly believed there was a misrepresentation at the renewal of the policy then it would have voided the policy from the renewal date (which is inherently different from cancelling it with effect from 14 June) – which was the remedy available under CIDRA. In any event, turning to the points Accredited made, in my view they’re basically the same points I considered previously and addressed in my provisional decision. I accepted (and still do) that on 1 June 2024 plans were most likely in place for Mr F to depart on a round-the-world holiday for an extended period and for Mr J to live in the property. But I disagree with Accredited that this means Mr F knew that what he’d disclosed at renewal would soon be inaccurate/untrue. The information he provided at the renewal of the policy remained accurate/true because, as I explained in my provisional decision, after 14 June it remained that: • the property wasn’t let or sub-let and there weren’t any non-family lodgers living there • the property was regularly occupied day and night and it wouldn’t be unoccupied for more than 60 days • the property was Mr F’s main home • the property wasn’t used for business purposes. The only potential misrepresentation was that there would be three adults (rather than two) and one child living in the property. But Accredited hasn’t shown this would have affected its decision to continue providing cover.

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But this is a moot point anyway, because even if the information provided at renewal became inaccurate and even if Mr F knew it would become inaccurate, Mr F only had to disclose the true situation at the time of renewal by answering Accredited’s questions accurately. And he wasn’t asked as part of the renewal process if anything he’d disclosed would become inaccurate. As I said in my provisional decision, the possibility of circumstances changing throughout the lifetime of a policy is the precise reason why Accredited inserted the ‘change in risk’ condition into the policy. I therefore remain of the view that Accredited hasn’t shown that Mr F misrepresented the situation when the policy renewed. Breach of condition In summary, Accredited said in response to my provisional decision: • it needed to be told if someone lived in the property other than Mr F and his family – which implies that Mr F must live there together with his family • so Mr F should have told it about his planned holiday on/by 14 June • it didn’t accept Mr F could reasonably be considered to be living at the property when he was overseas for nearly a year • it accepted Mr J was a family member but it didn’t accept he fell within the policy definition of “family” • it doubted Mr J lived at the property – rather, it felt he just stayed there occasionally when he wasn’t working away, on holiday or at the other property he co-owned with his partner. Again, I think these points are essentially the same ones I considered previously and addressed in my provisional decision. I explained in my provisional decision why I felt Mr F still lived in the property even though he was on holiday and why I felt Mr J fell within the policy definition of family. I also explained why/how that led to my conclusion that Mr F didn’t breach the policy condition requiring him to tell Accredited about any change in circumstances. Although I note Accredited’s disagreement with my interpretations and reasoning, I don’t have anything to add to what I said previously. I note Accredited’s points about why a neighbour would have a key if Mr J lived in the property and why Mr J hadn’t changed his address, but I commented on this in my provisional decision and I don’t have anything further to add. Accredited also noted Mr J’s statement that after Christmas his partner and her daughter travelled to the insured address for the New Year but he didn’t go as he was unwell. It queried why Mr J’s partner would travel over 200 miles for New Year without him. It considered it more likely that they (rather than Mr J – because he was ill) travelled to the property to ensure everything was in order. Accredited had plenty of opportunity to clarify this point if it wanted to. But, in any event, it’s not clear to me what point Accredited is trying to make here. It doesn’t show that Mr J wasn’t living at the property and it doesn’t have any bearing on my other conclusions. Accredited also pointed to various words Mr F and Mr J used in their statements and communications: • Mr J said he returned from Copenhagen and went directly to stay at the insured property without going to his other property

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• Mr J said it was agreed he could live at the insured property while Mr F was away • when reporting the claim Mr F said he was on holiday and Mr J was staying in his house. It felt the words/phrases in italics implied that Mr J was simply staying at the property while Mr F was away, rather than permanently living there. I don’t think it’s entirely clear what was meant by what was said. I agree it could be interpreted how Accredited has done. But it could also simply be the way Mr F and Mr J phrased it. Again, Accredited had plenty of time to question Mr F and Mr J to get a better understanding of what they’d said. It didn’t do so. Because of the lack of clarity I don’t think it’s enough on the balance of probabilities to conclude that Mr J wasn’t living at the property. Summary For all the reasons outlined above, it remains my conclusion that: • there wasn’t any misrepresentation at the renewal of the policy • Mr F didn’t breach the policy condition requiring him to tell Accredited about any change in circumstances. Accordingly, it remains my conclusion that it was unfair for Accredited to have cancelled the policy and rejected the claim on these bases. My final decision I uphold this complaint. I require Accredited Insurance (Europe) Ltd to settle the matter as outlined under the Putting things right heading above. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr F to accept or reject my decision before 22 April 2026. Paul Daniel Ombudsman

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