DRN-6229556

The complaint B, a business, complains about HDI Global Specialty SE’s (‘HDI’) decision to decline cover for a claim it made under its commercial insurance policy. HDI also voided the policy and retained the premium paid by B. B is unhappy with this and feels that HDI treated it unfairly. The complaint is brought by Miss B on behalf of B, but I shall refer to all submissions as B’s own for ease of reference. What happened The details of this complaint are well known to both parties, so I won’t repeat them here. Instead, I’ll focus on providing my reasons for my 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. Having done so, I won’t be upholding B’s complaint. I’ll explain why. Before I do, I wish to acknowledge all of the submissions B has made in response to the investigator’s view. Whilst I’ve read everything it has said, I won’t be addressing it all. That’s not intended to be disrespectful. Rather, it’s representative of the informal nature of the Financial Ombudsman Service. Instead, I’ll focus on the crux of B’s complaint, namely whether it was fair for HDI decline B’s claim, void the policy and retain the premium in the way that it did. When B took out insurance with HDI online in 2025, it confirmed that it agreed it did not use “IPL, light, heat or lasers”. But when it presented its claim for loss because of a burglary, it made a claim for a high value Alma laser machine, which is used for various aesthetic treatments. HDI declined B’s claim on the basis that it didn’t offer cover for the use of lasers at all and had B told it about such use, it would not have offered cover. When B took the policy out, the relevant law was the Insurance Act 2015, under which there’s a duty to make a “fair presentation” of the risk. This duty applied when B took out cover. When buying or renewing the policy the party seeking insurance – in this case, B – was required to disclose every circumstance they knew, or should have known, which would influence a prudent insurer in deciding whether to underwrite a risk or what premium to charge. From what I’ve seen, B was asked clear questions about whether it used lasers at its business premises, and it confirmed that it did not. However, when it came to claim, it sought cover for the loss of the laser machine. B has said that it was not using laser equipment at the time it took out cover or made its claim for loss. But I’m not persuaded by this. I say so because the evidence HDI has

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supplied supports that when taking out cover, B also ran quotations for the use of lasers at its business premises. HDI says that as they did not offer such cover, the quotation was unsuccessful. From what I’ve seen it looks like B re-ran the quotation, excluding laser use thereafter and obtained cover on that basis. In light of that, and the fact that B was claiming for the loss of the laser equipment itself, as well as the absence of any credible reason why such equipment would be kept on site, if not in use, I think it’s more likely that B was using laser equipment from the time it sought cover. B had a legal duty to disclose anything that would influence the insurer’s decision about offering cover. My judgment is that B knew (or should have known) that HDI would have wanted to be told about the fact that it had laser equipment on its premises when applying for cover. So, this should have been disclosed. By not telling HDI about this, B mispresented the risk and failed to meet its legal duty – whether the duty of “utmost good faith” or the duty make a “fair presentation” of the risk. If the insured party fails to disclose this kind of circumstance, and the insurer can show it would not have offered the policy if it had been disclosed, it’s entitled to void the policy. And if the breach was deliberate or reckless, it doesn’t have to refund the premium to the insured. I’ve considered whether HDI has shown the failure to disclose that B had laser equipment on its premises and was likely using it, would have made a difference. The underwriting evidence HDI have supplied shows that the risk would have been considered unacceptable to it had this been confirmed. So, cover wouldn’t have been offered. Looking at the underwriting evidence, I’m satisfied that it is consistent with the guidance HDI was following when it discovered B’s claim for the laser machine. As such I think it acted in accordance with this when declining the claim in its entirety and voiding the policy. HDI has considered the breach to be either deliberate or reckless. Having considered the evidence in this case carefully, I agree the breach was at least reckless, but most likely deliberate. The fact that B ran a quote with HDI for cover for the use of lasers and then amended it to exclude this afterwards when it because clear no cover was available, suggests to me that it was aware that cover wouldn’t be offered for this type of use and that B sought to obtain cover, nonetheless. As such I take the view that HDI doesn’t need to repay the policy premiums. Taking account of the relevant law, the policy terms and all the circumstances, I think HDI’s decision was fair.

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My final decision For the reasons set out above, I don’t uphold B’s complaint against HDI Global Specialty SE. Under the rules of the Financial Ombudsman Service, I’m required to ask B to accept or reject my decision before 25 May 2026. Lale Hussein-Venn Ombudsman

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