Admiral Insurance (Gibraltar) Limited · DRN-6249586

The complaint Mrs and Mr A complain about Admiral Insurance (Gibraltar) Limited’s offer of settlement of their travel insurance claim. What happened Mrs and Mr A had annual travel insurance insured by Admiral. They were travelling to an airport in the UK to take their flight for a holiday abroad. The motorway was closed in both directions due to a road traffic accident and they realised they were going to miss the flight. Mrs and Mr A phoned Admiral to ask what they were covered for as they didn’t have their policy documents to hand. Admiral told them they were covered under the ‘Missed international departure’ section of their policy. Mrs and Mr A say they understood from their call with Admiral that their holiday costs would be covered and they abandoned their holiday. They claimed for the full cost of the holiday, about £4,000. Admiral declined the claim so Mrs and Mr A complained to it. Admiral’s final response letter in summary said: • In the call Mrs and Mr A hadn’t told its representative that they intended to abandon their holiday. But it acknowledged that its representative didn’t tell them the ‘Missed international departure’ policy section only provides cover for accommodation and onward travel to enable them to continue their trip. • The claim wasn’t covered under the ‘Abandoned trip’ or ‘Missed international departure’ policy terms but as it hadn’t provided Mrs and Mr A with accurate information it offered to pay the claim to the policy limit that applied to missed international departure which was £500 per person, £1,000 in total, plus the unused airport parking. • It acknowledged the claims process hadn’t been straightforward for Mrs and Mr A and they’d had to make several calls to it about different matters. It offered £150 for their distress and inconvenience. Mrs and Mr A complained to us. In summary they said: • They were very stressed having been in the car for hours and knowing they were going to miss their flight. They phoned Admiral to ask about their cover and Admiral didn’t tell them they would be covered to get the next available flight. • If they’d been told the correct information the airline had told them there was a flight four days later so they would have gone and had a shorter holiday. • Admiral’s claim handling had been very poor and confusing for them (which they detailed).

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Our Investigator considered Admiral had reasonably settled the claim and its offer of compensation for Mrs and Mr A’s distress and inconvenience was fair. Mrs and Mr A disagreed and wanted an Ombudsman’s decision. Before I made my provisional decision I asked Mrs and Mr A to clarify the situation about their booked hotel abroad as they’d told Admiral that the airline did try to put them on a later flight but no hotel accommodation was available. I also asked why they hadn’t taken the flight four days later to have a shorter holiday. I referred to their response in my provisional findings below. What I provisionally decided – and why I made a provisional decision explaining why I was intending to uphold this complaint. I said: ‘I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. The relevant regulator’s rules say that insurers must handle claims promptly and fairly and they mustn’t turn down (or settle) claims unreasonably. I’ve listened to the call Mrs and Mr A made to Admiral when they were stuck in traffic and wanted to know what they were covered for as they were going to miss the flight. Admiral’s representative told them they were covered for missed international departure. The policy terms under the ‘Missed international departure’ policy section say: ‘We cover you if you miss: the final departure leaving the UK on your outbound journey; …. We will pay up to the policy limits shown in the policy schedule to cover the cost of unused accommodation, and reasonable costs for additional accommodation and onward travel to enable you to continue with your trip, if you fail to arrive at your international departure point in time to board your pre-booked aircraft, ship or train for any of the following reasons … An accident or breakdown on a motorway or dual carriageway caused an unexpected delay to your journey’. The cover under the above policy terms is for unused accommodation and the reasonable costs for additional accommodation and onward travel to enable Mrs and Mr A to continue with their holiday. The costs Mrs and Mr A claimed were for the costs of the unused travel, the whole unused accommodation abroad and unused airport parking, so not covered by the ‘Missed international departure’ policy terms. I’ve also looked at the cover under the ‘Abandoned trip’ section Admiral referred to. That section covers unrecoverable pre-paid accommodation, unused travel and car parking costs but only when Mrs and Mr A abandon their trip because their pre-booked flight international departure is delayed by more than 24 hours or is cancelled with no alternative transport available within 24 hours of the scheduled departure because of strike, industrial action, severe weather conditions or a mechanical breakdown. That wasn’t Mrs and Mr A’s situation and there’s no cover for their claim under the ‘Abandoned trip’ policy terms.

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But I’ve also considered what’s fair and reasonable in all the circumstances of the complaint. In the relevant call Admiral told Mrs and Mr A their circumstances were ‘definitely covered under the policy wording for missed international departure’. Admiral says Mrs and Mr A never told it they intended to abandon the holiday. But Admiral is the insurance expert in that call and its representative didn’t ask Mrs and Mr A what they intended to do. Most importantly Admiral didn’t tell Mrs and Mr A that the ‘Missed international departure’ policy section only covered them if they were going to continue the trip and then only for certain costs, and I think Admiral should have done so. I need to decide if Admiral not giving Mrs and Mr A that important information disadvantaged them and I think it did for the following reasons. Mrs and Mr A told our Investigator that if Admiral had given them the correct information about cover they would have taken the next flight and had a shorter holiday. Towards the end of the call, when Admiral reconfirmed the incident was covered under missed departure, Mr A responded ‘That’s a relief’ and said the airline did try to put them on a later flight (which was four days later) but no hotel accommodation was available. Mrs and Mrs A have now clarified that the hotel they were booked to stay at was available for the original duration of their trip but it had no availability if they’d extended their trip to add on the missed four days. They would have had to pay extra for an alternative hotel. So I think if Admiral had given them the full details of what was covered under the ‘Missed international departure’ policy section Mrs and Mr A would have gone on holiday and had the cover for costs payable under that policy section, up to the policy limit of £500 per person. Admiral offered to pay £1,000 for the claim and pay the unused airport parking costs, which it says is fair in the circumstances. I need to decide if Admiral’s offer is a fair amount to settle the claim. Mrs and Mr A are under a duty to ‘mitigate their loss’, that is minimise the expenses they claim, so I’ve considered whether they should have reasonably gone on the shorter holiday anyway. They say they phoned Admiral in a very stressful situation asking for guidance, it didn’t tell them to take the shorter holiday and they understood they should go home and make the claim with their lost holiday costs being covered. I’ve listened to the call between Mrs and Mr A and Admiral several times and overall I think that was a reasonable conclusion for them to make. As well as Admiral’s representative saying several times that their circumstances were covered she finished the call by saying they could set up the claim when they got home. I appreciate she probably meant when they got home from their holiday but that wasn’t clear to Mrs and Mr A. I’m satisfied Admiral not giving Mrs and Mr A the important information about the scope of their cover in their circumstances disadvantaged them. I think they would have taken the trip, so not have lost costs, if Admiral had told them the full details about the missed departure cover, as it should have done. Also from what Admiral did say to Mrs and Mr A they could reasonably believe they could abandon their trip and the costs would be covered. In these circumstances I think it’s fair and reasonable for Admiral to pay the claim subject to the policy limit and excess that apply to the ‘Abandoned trip’ section of the policy. Their policy schedule shows the policy limit for an abandonment claim is £1,500 per person with an excess of £150 per person. It’s not clear whether Admiral has already made any payment to settle the claim but if so it can deduct the payment already made. Admiral and Mrs and Mr A should tell me if any claim payment has already been made when responding to my provisional decision. I’ve considered the service Admiral gave Mrs and Mr A during the claim process. I think Admiral gave them confusing information and, as it says, the claims process wasn’t as straightforward or smooth as it should have been for them. But I think the £150

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compensation Admiral offered for their distress and inconvenience was a reasonable amount. I understand the £150 has already been paid to them and they should tell us if not when responding to my provisional decision’. Responses to my provisional decision Mrs and Mr A and Admiral accepted my provisional decision. Admiral said it hadn’t paid any settlement for the claim and on receipt of my final decision it would pay in line with my recommendation. 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. As Mrs and Mr A and Admiral have accepted my provisional decision I’ve no reason to change my mind. For the reasons I’ve given in my provisional findings and these findings I uphold this complaint. In these particular circumstances I think it’s fair and reasonable for Admiral to pay the claim subject to the policy limit and excess that apply to the ‘Abandoned trip’ section of the policy, plus interest as detailed below. Admiral should also pay £150 compensation for Mrs and Mr A’s distress and inconvenience caused by its poor service, as it offered. Admiral has confirmed it hasn’t already paid the settlement it offered for the claim. So Admiral should pay Mrs and Mr A the amount claimed subject to the policy limit and excess for an abandonment claim. Their policy schedule shows the policy limit for an abandonment claim is £1,500 per person with an excess of £150 per person. I understand the £150 compensation for Mrs and Mr A’s distress and inconvenience has already been paid to them but if not Admiral should now also pay that to them. My final decision I uphold this complaint and require Admiral Insurance (Gibraltar) Limited to: • Pay Mrs and Mr A’s claim applying the policy limit and excess applicable under the ‘Abandoned trip’ policy section, plus interest* at the simple rate of 8% per year from the date of claim to the date of settlement, and • Pay £150 for Mrs and Mr A’s distress and inconvenience caused by its poor service, as it offered (if it has not already done so). *If Admiral Insurance (Gibraltar) Limited considers that it’s required by HM Revenue & Customs to take off income tax from that interest it should tell Mrs and Mr A how much it’s taken off. It should also give Mrs and Mr A a certificate showing this if they ask for one, so they can reclaim the tax from HM Revenue & Customs if appropriate. Under the rules of the Financial Ombudsman Service, I’m required to ask Mrs A and Mr A to accept or reject my decision before 24 April 2026. Nicola Sisk Ombudsman

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