AmTrust Specialty Limited · DRN-6197998

The complaint Mr B and Mr M complain that AmTrust Specialty Limited (AmTrust) unfairly declined a claim made on a legal expenses insurance policy. Mr B and Mr M are joint policyholders, and so refer this complaint to our service jointly. However, the claim was made by Mr B and all the correspondence with both AmTrust and our service has been from Mr B. I’ll therefore refer to Mr B within this decision, but where relevant this should be taken to include Mr M. What happened Mr B and Mr M held a legal expenses insurance policy with AmTrust. Mr B has an ongoing claim with AmTrust in relation to an employment dispute. Mr B subsequently contacted AmTrust to make a new claim, alleging (amongst other matters) that there had been a breach of contract in relation to shares he’d purchased during the course of his employment. AmTrust initially considered Mr B’s claim to be an employment dispute, and declined cover. However, after Mr B provided further information and disputed AmTrust’s assessment, it considered his claim under the cover provided for contractual disputes. AmTrust declined cover under this section, as it said the policy restricted cover to disputes about contracts for goods and services. It didn’t consider that shares fell within the scope of goods and services. Mr B complained to AmTrust and then our service. Our investigator thought AmTrust acted reasonably when it declined cover for the claim. Mr B didn’t agree and requested an ombudsman’s 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. AmTrust initially considered Mr B’s claim under the section of cover for employment disputes. As I’ve said above, Mr B has an ongoing claim about his former employer, and on the claim form he referenced that this was linked in part to the other claim. It’s accepted now that the circumstances of this claim don’t fall within the scope of the employment disputes section of the policy, but I can’t say it was wrong for AmTrust to consider whether the policy provided cover under that section based on Mr B’s initial submission. The form referenced bonus and notice payments, as well as the shares. After Mr B provided further information once AmTrust had said there was no cover under the employment disputes section of cover, the claim was rightly reassessed under the contract disputes section, which I’ll come onto consider below. If Amtrust’s decision to decline the claim was reasonable, then it follows that can’t say there was any detriment to Mr B in what happened – whether he was told at the outset there was

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no cover or later, the decision remains the same. However, if I think the decision wasn’t reasonable, then I’d then look at whether Mr B suffered any detriment, such as a delay to his legal claim or having to fund action which would otherwise have been met by AmTrust. Therefore, the primary question to be addressed is whether the decision to decline cover under the contracts dispute section was reasonable. The relevant section of cover, relating to “Contract disputes” says cover is provided for: “Costs for a legal action following a breach of a contract you have for buying or renting in goods or services for your private use or selling your personal goods. The contract must have been made after You first purchased this insurance and the amount in dispute must be more than £250 (including VAT).” When it declined cover for Mr B’s claim, AmTrust said shares don’t fall within the definition of goods or services. There’s no definition in the policy of “goods or services,” and so I need to take the ordinary and normal meaning of this, in the context of the relevant condition. Mr B believes that in the absence of a stated definition of “goods or services” within the terms and conditions, a reasonable interpretation of this would include shares. Alternatively, he says that the lack of a definition means the ambiguity of whether shares are goods or services should be interpreted in his favour, ie that shares do fall within this definition. So it seems to me that the relevant issue I need to decide is whether the scope of “goods or services” includes shares. No argument has been made that shares fall within the scope of any definition of “services.” I’m satisfied that any interpretation of “services” in this context infers something being done by a third party at the request of the policyholder (as opposed to being provided with something). The dispute therefore would seem to distil to the question of whether shares are “goods,” or could reasonably be interpreted as such. I think goods are essentially a tangible asset – something which can be possessed and used. Shares, it seems to me, are intangible. They can be owned, but there’s no use for them other than as signifying part ownership of the relevant business. I’m aware Mr B has drawn a parallel to digital goods, such as music, software or other media. Those don’t have a direct physical form but would reasonably be considered to fall within any definition of “goods.” He says that shares should be considered the same way – they aren’t a physical item but can be bought, sold and traded. However, I think a fair point to make here is that digital media or software has an obvious physical equivalent which is effectively interchangeable with a digital version, which isn’t the same as shares. There’s no physical equivalent of a share. I’m therefore satisfied that shares don’t fall within a reasonable definition of “goods or services.” I also don’t think there’s sufficient ambiguity in the definition (or lack thereof) within the policy to mean that I could reasonably say that disputes about shares should be fall within the scope of cover. That means AmTrust acted reasonably when it concluded the policy didn’t cover Mr B’s claim. As I’ve outlined above, while this could have been considered earlier, there was no detriment to Mr B by the delay in considering the cover. The decision reached was reasonable and would have been the same whenever looked at. I’m not minded to ask AmTrust to do anything to put things right here, as there’s no meaningful impact or financial loss to Mr B because of any failure on its part.

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My final decision I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr B and Mr M to accept or reject my decision before 25 May 2026. Ben Williams Ombudsman

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