DRN-5972142

The complaint Mr T complains that USAY BUSINESS LTD trading as Usay Compare (‘Usay’) mis-sold him an income protection insurance policy. What happened Mr T was sold an income protection insurance policy by Usay. Usay told Mr T the policy would pay a benefit based on his gross annual earnings. When Mr T subsequently made a claim under the policy, the benefit payments were less than he was expecting, so he complained to Usay before bringing the matter to the attention of our Service. Usay made a number of offers to settle Mr T’s complaint, with the most recent (and the only one remaining in force) being to refund overpaid premiums of £113.35 plus 8% interest and pay compensation of £300. One of our Investigators looked into what had happened and said he thought this offer was fair and reasonable in the circumstances. Mr T didn’t agree with our Investigator’s opinion, so the complaint has now been referred to me to make a decision as the final stage in our process. 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 making this final decision I can only comment on Usay’s actions. Usay wasn’t responsible for the decision to terminate Mr T’s claim payments. That was the decision of the business who underwrites the policy and Mr T has brought a separate complaint to our Service about that matter. I’ve carefully read and thought about the detailed submissions both parties have made but I won’t be addressing every complaint point raised and I’m not obliged to do so. Instead, reflecting the informal nature of our Service as an alternative to the civil courts, I’ll only be commenting on what I think are the key issues. Overall, I’m satisfied that Usay’s offer to refund Mr T £113.35 together with interest and to pay him £300 compensation is fair and reasonable in the circumstances and I’ll explain why: • The rules governing the operation of our Service (the Financial Conduct Authority’s Dispute Resolution (‘DISP’) rules) set out my powers. These rules are for me to interpret and apply. My remit is to make a decision based on what I think is fair and reasonable in the circumstances of an individual complaint, taking into account relevant considerations such as industry rules and guidance. • This was an advised sale by Usay. This means Usay needed to provide information

-- 1 of 3 --

to Mr T about the policy he was buying which was clear, fair and not misleading and to recommend a policy which was suitable for Mr T’s demands and needs. • It’s not up to the parties to decide what evidence I need to make a decision. I don’t think it’s necessary for me to request or listen to any calls that took place between Usay and Mr T around the time the claim was made. What is relevant here is the information Usay gave to Mr T when the policy was sold. • It’s not in dispute that Usay gave Mr T incorrect information when the policy was sold. It told him that benefit payments would be based on his gross annual earnings, which wasn’t correct. So, all that remains to be determined is what financial remedy I think is fair and reasonable in the circumstances. • DISP doesn’t require me to put Mr T back in the financial position he would have been in if the policy had performed as described by Usay. Instead, to reach an independent and impartial outcome which I think is fair and reasonable to both parties, I’ve considered what financial position Mr T is likely to have been in if he had been given correct information about the policy (i.e., if Usay had told Mr T the policy paid a benefit based on his earnings after expenses but before tax). • I’m satisfied Mr T would never have been in a position to buy an income protection insurance policy which paid a benefit based on gross annual earnings. This simply isn’t how the income protection insurance market operates. It’s a general principle of insurance that a policyholder can’t profit from the product, so a claim could never have been paid to Mr T which included expenses or costs he hadn’t incurred. So, I don’t agree that Mr T has experienced a financial loss at the level he is suggesting. • If Usay had given Mr T correct information about the policy, then I think it’s fair to conclude he would still have gone ahead and purchased it regardless. To conclude otherwise would mean Mr T would never have been entitled to benefit from the claim payments which he did receive from the policy underwriter. However, Mr T would have paid a lower premium for the policy for a lower level of cover. • Usay calculated Mr T’s premium overpayments as £113.35 and has offered to refund these together with 8% interest. I’m satisfied this is fair and reasonable in the circumstances. Mr T has been paid a claim by the policy underwriters, thereby benefitting from the policy, so it wouldn’t be fair or reasonable to require any further refund of premiums to be paid to him. • Usay has also offered to pay Mr T £300 compensation for the distress and inconvenience he experienced. I’m satisfied this is fair and reasonable for the impact of Usay’s error on Mr T. • I have no power to seek to punish or fine a business through an award of compensation. I’ve taken into account our published guidance on the payment of compensation for distress and inconvenience and I’m satisfied Usay’s offer reflects Mr T’s loss of expectation and the effort he has gone to in order to resolve things. Compensation at the level Mr T is seeking simply isn’t something I’d consider fair and reasonable in this situation. • Usay, in correspondence with our Service, quoted an incorrect claim amount which it said the underwriter had paid to Mr T. This didn’t form part of Mr T’s original complaint to Usay or to our Service, so I don’t have any jurisdiction to comment on it here.

-- 2 of 3 --

Putting things right USAY BUSINESS LTD trading as Usay Compare needs to put things right and do the following: • refund Mr T £113.35 in overpaid premiums, together with interest at 8% simple per annum from the date each premium was paid until the date the settlement is made1: • pay Mr T £300 compensation for the distress and inconvenience he experienced. My final decision I’m upholding Mr T’s complaint about USAY BUSINESS LTD trading as Usay Compare in part, and I direct it to put things right in the way I’ve outlined above. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr T to accept or reject my decision before 22 May 2026. Leah Nagle Ombudsman 1 If USAY BUSINESS LTD trading as Usay Compare considers that it’s required by HM Revenue & Customs to deduct income tax from that interest it should tell Mr T how much it has taken off. It should also give Mr T a tax deduction certificate if he asks for one, so he can reclaim the tax from HM Revenue & Customs if appropriate.

-- 3 of 3 --