Lloyds Bank General Insurance Limited · DRN-6059625

The complaint Mrs H and Mr H have complained that Lloyds Bank General Insurance Limited voided their home insurance policy and didn’t deal with a claim they’d made on it. Reference to Mrs H includes Mr H and her representative. And reference to Lloyds includes its agents and representatives. What happened The circumstances of this complaint aren’t in dispute, so I’ll summarise the main points: • Mrs H took out a buildings and contents insurance policy through an independent intermediary I’ll call S. It was underwritten by insurers other than Lloyds. • At the 2024 renewal, Lloyds became the underwriter. After that, Mrs H got in touch with Lloyds to make a claim following a fire. • Lloyds said Mrs H should have disclosed CCJs at the 2024 renewal, but hadn’t done so. As a result, Lloyds went on to void the policy and didn’t deal with the claim. It agreed to refund the premiums Mrs H had paid. • Mrs H complained. She made a number of points, including: o She originally took the policy out in 2016 and, at that time, neither she nor Mr H had any CCJs. So there could have been no misrepresentation then. o They were issued CCJs in October 2020 and February 2021. o This information was publicly available, but the policy was nonetheless renewed by S and the relevant underwriters, including Lloyds. o After receiving the CCJ in October 2020, Mrs H contacted a party (which I understand to be S or the underwriter at the time) to let them know. She recalls being told no changes to the policy were required. • Lloyds maintained its position. • Our investigator thought Lloyds had acted in line with the relevant law and didn’t ask it to do anything further. • An agreement wasn’t reached, so the complaint has been passed to me. 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. • When considering what’s fair and reasonable in the circumstances I’ve taken into account relevant law and regulations, regulators’ rules, guidance and standards, codes of practice and, where appropriate, what I consider to have been good industry

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practice at the time. Whilst I’ve read and taken into account everything said by both parties, I’ll only comment on the points I think are relevant when reaching a fair outcome to this dispute. That’s a reflection of the informal nature of this Service. • I’ll start by setting out the scope of this complaint. I can only consider activities Lloyds is responsible for. It isn’t responsible for S or the activities S carried out, as S is an independent intermediary. Mrs H is entitled to make a separate complaint about S if she would like to, and I understand she may have begun that process. Nor is Lloyds responsible for any of the other underwriters that provided cover in earlier years. • The main point of this complaint is whether it was fair for Lloyds to void the policy and decline the claim. In short, it took these steps because it didn’t think Mrs H provided reasonable information at the 2024 renewal. So that’s what I’ll focus on. • When looking at the information provided at a renewal for a consumer policy, as was the case here, the relevant law is the Consumer Insurance (Disclosure and Representations) Act 2012 (or “CIDRA”). It places a duty on the consumer, in this case Mrs H, to ‘take reasonable care not to make a misrepresentation’. • In summary, if Mrs H fulfilled that duty, Lloyds can take no action. If Lloyds can show she didn’t fulfil that duty, and it can show that it would have acted differently if she had fulfilled that duty, CIDRA sets out the remedies available to Lloyds. Depending on the circumstances, that can include voiding the policy, which means treating it as if it never existed. As a result, it can also include declining the claim. • Amongst other things, at the 2024 renewal, Lloyds wanted to know whether Mrs H, or anyone living with her, had any CCJs. Lloyds said it wouldn’t have offered a policy if they did. • Lloyds has shared underwriting information with this Service. It’s commercially sensitive, so it wouldn’t be appropriate for me to discuss it in detail, or to share it as Mrs H has requested. Nor would I expect Lloyds to share it with her. But I can assure her the information is clear and persuasive, and I’m satisfied it shows Lloyds wouldn’t have offered the policy – on any terms – if it had known of the CCJs in 2024. Our investigator checked this point thoroughly and Lloyds responded comprehensively. • Through S, Lloyds was told there were no such CCJs. It was entitled to rely on that information and offer Mrs H the policy accordingly. It wasn’t required to double check the accuracy of that information at the time of the renewal. As set out above, the onus was on Mrs H to take reasonable care – not on Lloyds to check she’d done so. • Mrs H has accepted there were two such CCJs. One was received by Mr H in February 2021. Mrs H has provided evidence to show he was diagnosed with a condition in 2024, which meant he was highly unlikely to have the mental capacity to meaningfully engage with the 2024 renewal and remember the CCJ. And Mrs H says she was unaware of the CCJ, so she couldn’t have disclosed it at that time either. As a result, it may not be unreasonable that this CCJ wasn’t disclosed. • But, even if that were the case, Mrs H received a separate CCJ in August 2020. She says she took steps to raise this soon after, I understand by contacting S or the underwriter at the time by phone. So it’s clear she was aware of it and long before the 2024 renewal. As a result, I think it’s fair to say this CCJ, at least, ought to have been disclosed to Lloyds.

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• As no CCJ was disclosed to Lloyds, it doesn’t seem to be in dispute that Lloyds was given inaccurate information. Because of this, I’m not satisfied Mrs H met her duty under CIDRA to ‘take reasonable care not to make a misrepresentation’. And, as Lloyds wouldn’t have offered the policy if it had known about at least one of the CCJs, it’s entitled under CIDRA to void the policy and decline the claim. • Mrs H has challenged this position for a number of reasons, mostly related to what happened before Lloyds became the underwriter – firstly, when the policy was initially taken out and, secondly, when she received her CCJ in 2020. • Lloyds wasn’t the underwriter at these times. It first became the underwriter in 2024. That means it’s not relevant to Lloyds that Mrs H had no CCJs when she initially took the policy out with another underwriter. Nor is it relevant if she contacted S or another underwriter about her CCJs prior to Lloyds becoming the underwriter. • Ultimately, Lloyds was told there were no CCJs – and that was inaccurate, as at least one CCJ ought to have been disclosed. So, in line with CIDRA, Lloyds was entitled to take the action it did. • It’s clear the fire has had a profound impact on Mrs H, both financially and otherwise. Lloyds’ decision to void the policy and not deal with the claim has exacerbated the impact and left her in a very challenging situation. Mrs H has questioned whether Lloyds’ action was proportionate and fair in the circumstances. • For the reasons given above, I’m satisfied Lloyds followed the relevant law. And that law reflects the longstanding approach of this Service. Put simply, Lloyds has done nothing wrong. In these circumstances, I see no reason to require Lloyds to depart from the law. Whilst I recognise the consequences for Mrs H will be significant, that’s not something I can fairly hold against Lloyds, for the reasons given. • Some of the points Mrs H has made are about the way Lloyds handled her complaint. These aren’t points I can consider, as we can’t consider complaint handling in its own right. So I won’t comment on these points further. My final decision I don’t uphold this complaint Under the rules of the Financial Ombudsman Service, I’m required to ask Mr H and Mrs S to accept or reject my decision before 2 April 2026. James Neville Ombudsman

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