Vitality Health Limited · DRN-6199136

The complaint Mr M has complained that Vitality Health Limited failed to inform him when his private medical insurance policy was cancelled. What happened Mr M was a member on a group policy provided by his employer, with his membership starting on 14 July 2025. He contacted Vitality on 8 August 2025 after being unable to gain access to the online membership portal and app. He was told at that time that the policy had been cancelled on 22 July 2025 at the request of his employer. Mr M then contacted the relevant person at his employer (‘the company contact’) who said they had no idea the policy had been cancelled and who then liaised with Vitality to resolve the issue. By 18 August 2025, his access to the app and online member zone had been restored. In response to the complaint, Vitality’s position was that it wouldn’t contact him directly in relation to cancellation as it was a group policy, instead it would discuss administrative matters only with the company contact. However, it acknowledged that there had been some poor customer service and so offered him £75 compensation for distress and inconvenience. It has also reinstated the membership points lost during the time that cover wasn’t in place. Our investigator thought that Vitality had acted reasonably in not contacting him about the cancellation, in line with the policy terms and conditions. She also thought that the payment of £75 compensation was a reasonable response to the complaint, so she didn’t recommend that Vitality should do anything more. Mr M disagrees with the investigator’s opinion and so the complaint has been passed to me for a 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. The ombudsman was established to be a quick and informal service. This doesn’t mean we apply any less rigour or care in reaching our decisions. But it does mean that we might not respond to each and every point that has been raised. Mr M has made detailed submissions in support of his complaint. Although I will not be addressing them all, I would like to assure him that I have read and considered everything he has provided. Looking at the policy terms, it states: ‘We will discuss renewal terms and other matters of administration only with the Company Contact (formerly Group Secretary) (acting on behalf of the planholder) and not with any individual insured member.’

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In the normal course of events, there would be two scenarios in relation to cancellation of the policy. Either, the insured would tell their employer that they didn’t want the policy anymore, or they were leaving that employment, meaning that the cover would come to an end. The employer (acting as ‘the planholder’) would then contact Vitality to make the cancellation request. Therefore, in that case there’d be no need for Vitality to tell the insured that cover was ending, as they would already know, having instigated it. Alternatively, Vitality would make the decision to cancel the policy due to some misconduct of the insured person (as set out in the policy terms), or due to the insured ceasing to reside in the UK. In which case Vitality would write to inform them of cancellation. What happened to Mr M doesn’t sit within either of those scenarios. That’s because there was a mistake and the policy shouldn’t have been cancelled. Our investigator has previously set out Vitality’s explanation of how the error occurred. Although this seems to differ from the explanation provided to Mr M by his employer, the crux of the matter isn’t about how the mistake itself came about. Mr M’s point is that, regardless of where any mistake originated, if Vitality had a process in place whereby it contacted policyholders directly following all cases of cancellation, he would have known about the issue straight away. Even if Vitality thought that the planholder would inform someone, it should also contact the insured, in addition to that. Better that they hear it twice, than not at all. Mr M received welcome correspondence from Vitality confirming the policy was in place. He also received some marketing correspondence after the policy had been cancelled. He therefore thinks that Vitality should use the same communication channel to let someone know about cancellation. I appreciate Mr M feels very strongly that Vitality should have a process in place whereby it takes responsibility in all cases, as the underwriter, to inform individuals if their cover has been cancelled. However, it’s important to make clear that we are not the industry regulator. We have no power to regulate the financial businesses we cover, nor to direct them to change their processes or procedures. Whilst Mr M says that makes us sound disinterested, I’m afraid that’s simply not our role. It’s open to Mr M to raise his wider concerns with the regulator should he wish to do so. Our role is to investigate individual complaints made by consumers to decide whether, in the specific circumstances of that complaint, a financial business has done something wrong which it needs to put right. Mr M has speculated about what might have happened if he’d needed to make a claim during this period. He’s also wondered how long he might have gone without knowing he was not insured. I’m unable to look at hypothetical situations (in relation to what might have happened), only at what did happen. Fortunately, Mr M didn’t need to make a claim, so there’s no detriment there, and he became aware of the cancellation on 8 August 2025. He found out via his employer the same day that this was a mistake and therefore that steps would be taken to reinstate the policy. The marketing letter he received was asking if he’d like to take up a personal policy, now that he no longer had group cover. Mr M says that, if he was of a nervous disposition, he might have taken that to mean that his job was being terminated. However, Mr M would have understood that this letter was a consequence of the mistake in cancelling the policy. He says that, by default, this letter was telling him the policy had been cancelled, which Vitality said it wouldn’t do. However, under the terms of the policy, it states that it will not

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discuss the administration of his plan directly with him. Sending marketing material in relation to buying a new policy is a different matter. The letter does indeed mention that he is no longer a member of his group scheme. However, under normal circumstances, this wouldn’t come as any surprise to the recipient. When Mr M was trying to access the online portal and app, he received a generic error message. Vitality has acknowledged that the message could have been more specific and it has passed this suggestion back to its relevant team. I’m satisfied that is a reasonable response to that part of the complaint. I’ve thought very carefully about what Mr M has said and I appreciate he feels very strongly about the issues he has raised. I’m sympathetic to his position - he wasn’t informed that his policy had been cancelled, he couldn’t access the app and then, when he called about that, he was told about the cancellation, which came as a shock to him. However, overall, the distress and inconvenience he suffered was fairly short-lived and I’m satisfied that £75 and the restoration of membership points is sufficient compensation for the impact the errors caused. As it was a group policy, Vitality had no obligation to contact him directly about the cancellation, in line with the policy terms and conditions. It follows that I do not uphold the complaint. My final decision For the reasons set out above, I do not uphold the complaint. However, Vitality Health Limited should pay Mr M the £75 compensation now if it hasn’t already done so. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr M to accept or reject my decision before 22 April 2026. Carole Clark Ombudsman

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