Halifax rebuked over pet insurance

 

The ombudsman has rebuked Halifax after it made a potentially "misleading" claim promising life-long insurance to pet owners.

The landmark decision by the Financial Ombudsman Service (FOS) could pave the way for thousands more customers who may have believed the cover lasted indefinitely.

Halifax, which is part of Lloyds Banking Group, previously advertised "life-long" pet insurance cover, but last autumn it withdrew from the pet insurance market. It said it is "urgently" working on a solution and will contact customers in the coming weeks.

The ombudsman considered the case of a dog named Lucky which developed a skin condition estimated to cost around £720 a year for the rest of her life.

In a provisional decision, the ombudsman said Halifax should pay Lucky's owner £200 for distress and inconvenience, as well as "top up" cover for any pre-existing condition not covered by Lucky's new insurer for the next three years.

Lucky's retired owner had taken out a Halifax pet insurance policy on her in 2005 when she was two months old and remained a "loyal customer" over the next six years, paying a monthly collected premium initially of about £6 rising over the years to £10, the ombudsman said.

However last year Halifax wrote to Lucky's owner a month before the policy was due to renew, to tell her it was withdrawing from the pet insurance market.

The ombudsman said that if Lucky's owner made alternative arrangements with another insurer, Lucky's pre-existing medical conditions would not be included in the cover, meaning Halifax's decision to withdraw from the market has left Lucky's owner footing the vet bills herself.

Lucky's owner complained to the ombudsman service, arguing that if Halifax cannot continue to supply insurance cover then it should compensate her for future bills and for "significant distress" and anxiety.

The ombudsman partially upheld the complaint in its provisional findings, noting that when Lucky's owner first purchased the policy, it was described on the Halifax insurance website as "life-long cover from as little as £3.50 a month".

The ombudsman said the description of the policy as "life-long" seemed "a significant error by Halifax.

"The policy was not life-long... And it was clearly misleading to suggest that it was - regardless of the fact that this is a common term in similar pet insurance policies," the ombudsman said.

The watchdog said that Halifax was acting within its rights to withdraw from the market and was under no legal obligation to renew the policy at the end of each period of cover.

However it said that had Halifax been clearer in its statements, Lucky's owner would have been able to consider other arrangements.

The watchdog said Halifax could have given customers more notice of its decision to withdraw from the market and had shown "poor communication".

It said Halifax's actions "will have caused unnecessary inconvenience and distress to customers".

Lloyds and the Halifax had around 25,000 to 30,000 pet insurance customers between them and it is thought that between 3,000 and 4,000 of them have pets with pre-existing conditions which could cause them problems getting full cover with a new insurer.

A Lloyds Banking Group spokesman said: "Lloyds Banking Group withdrew from the pet insurance market last year.

"We acknowledge that this decision has caused concern among some customers whose pets have pre-existing medical conditions and are having difficulty finding a new insurer.

"We are urgently working on a solution for customers with pets who have pre-existing conditions and will be contacting them in the next few weeks with our proposals.

"If any customer wants to check if they are affected, they can contact us. We are committed to continuing to support our customers and are sorry for the inconvenience we may have caused."

PA

Start your day with The Independent, sign up for daily news emails
Have you tried new the Independent Digital Edition apps?
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    SThree: Experienced Recruitment Consultant

    £20000 - £40000 per annum + OTE + Incentives + Benefits: SThree: Established f...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE 40/45k + INCENTIVES + BENEFITS: SThree: The su...

    Recruitment Genius: Collections Agent

    £14000 - £16000 per annum: Recruitment Genius: This company was established in...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE 40k: SThree: SThree are a global FTSE 250 busi...

    Day In a Page

    Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

    How Isis profits from destruction of antiquities

    Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
    Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

    'If we lose touch we’ll end up with two decades of the Tories'

    In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
    Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

    The Arab Spring reversed

    Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
    King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

    Academic claims King Arthur was real - and reveals where he lived

    Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
    Who is Oliver Bonas and how has he captured middle-class hearts?

    Who is Oliver Bonas?

    It's the first high-street store to pay its staff the living wage, and it saw out the recession in style
    Earth has 'lost more than half its trees' since humans first started cutting them down

    Axe-wielding Man fells half the world’s trees – leaving us just 422 each

    However, the number of trees may be eight times higher than previously thought
    60 years of Scalextric: Model cars are now stuffed with as much tech as real ones

    60 years of Scalextric

    Model cars are now stuffed with as much tech as real ones
    Theme parks continue to draw in thrill-seekers despite the risks - so why are we so addicted?

    Why are we addicted to theme parks?

    Now that Banksy has unveiled his own dystopian version, Christopher Beanland considers the ups and downs of our endless quest for amusement
    Tourism in Iran: The country will soon be opening up again after years of isolation

    Iran is opening up again to tourists

    After years of isolation, Iran is reopening its embassies abroad. Soon, there'll be the chance for the adventurous to holiday there
    10 best PS4 games

    10 best PS4 games

    Can’t wait for the new round of blockbusters due out this autumn? We played through last year’s offering
    Transfer window: Ten things we learnt

    Ten things we learnt from the transfer window

    Record-breaking spending shows FFP restraint no longer applies
    Migrant crisis: UN official Philippe Douste-Blazy reveals the harrowing sights he encountered among refugees arriving on Lampedusa

    ‘Can we really just turn away?’

    Dead bodies, men drowning, women miscarrying – a senior UN figure on the horrors he has witnessed among migrants arriving on Lampedusa, and urges politicians not to underestimate our caring nature
    Nine of Syria and Iraq's 10 world heritage sites are in danger as Isis ravages centuries of history

    Nine of Syria and Iraq's 10 world heritage sites are in danger...

    ... and not just because of Isis vandalism
    Girl on a Plane: An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack

    Girl on a Plane

    An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack
    Why Frederick Forsyth's spying days could spell disaster for today's journalists

    Why Frederick Forsyth's spying days could spell disaster for today's journalists

    The author of 'The Day of the Jackal' has revealed he spied for MI6 while a foreign correspondent