DRN-6214452

The complaint Mr T complains about the amount Marshmallow Insurance Limited charged for his motor insurance policy. 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. Our investigator thought Marshmallow acted fairly. I agree, and for the same reasons, so I don’t think it’s necessary for me to go over everything again in detail. Instead, I’ll summarise the main points: • Mr T held motor insurance with Marshmallow. When it renewed in 2025, the premium increased. Part way through the 2025 policy year, Mr T changed from Vehicle A to Vehicle B, and the premium increased again. • Mr T accepted the new, increased premium. But he didn’t think it was fair he should pay more, in part because he said the vehicle change wasn’t his choice. • Each insurer is entitled to take its own view of risk and, based on that, whether to offer insurance cover to a particular policyholder – and, if so, at what price. • Nonetheless, I would expect Marshmallow to be able to show it set the new premium fairly. That would mean it was set in line with Marshmallow’s general view of risk and Mr T was treated consistently with how any other policyholder in similar circumstances would have been. I’m satisfied Marshmallow has done that, based on the underwriting information and commentary it’s provided to this Service. • That evidence is commercially sensitive, so it wouldn’t be appropriate for me to share it or discuss it in detail – and that’s why I wouldn’t expect Marshmallow to divulge it to Mr T either. But I can assure Mr T I’ve thoroughly considered the evidence and I’ve found it persuasive. Whilst he may have wanted to know exactly why the premium increased, that’s not something an insurer is required to explain. • Mr T was under no obligation to accept the new, increased premiums if he didn’t want to. It was open to him to reject the new premiums and move to another insurer, if he thought that was more economical and/or Marshmallow had treated him unfairly. • I understand Vehicle A had to be returned as it was unsafe. So it wasn’t Mr T’s choice to change vehicles. But I don’t think that’s relevant here. That’s because the premium increase wasn’t a penalty for making a change – it was a reflection of the increased risk Marshmallow associated with the change to Vehicle B, based on its underwriting information and general view of risk. • For the reasons given, I’m satisfied Marshmallow acted in line with pricing rules and requirements, and fairly and reasonably overall, when it increased the premium.

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• Mr T also said there were times he wasn’t actively using Vehicle A due to the safety problems. He questioned whether it was fair for him to continue paying his premium in those circumstances. Marshmallow thought it was, noting it was still providing cover for Vehicle A, and it would have been liable for valid claims during that time. I agree and I’m therefore satisfied Marshmallow acted fairly on this point too. • Marshmallow isn’t responsible for any costs or inconvenience which arose due to problems with Vehicle A. Mr T may have options to explore those matters with the responsible party. • Mr T was unhappy with how his complaint was handled by Marshmallow. But complaint handling isn’t something we have the power to consider – so I won’t do so. However, I note Marshmallow accepted it caused a degree of distress and inconvenience to Mr T and offered a total of £100 compensation, which includes the £50 offered previously, which Mr T has accepted in relation to the service only. My final decision I don’t uphold this complaint. 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. James Neville Ombudsman

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