Vitality Life Limited · DRN-6090099

The complaint Mr A is unhappy that Vitality Life Limited cancelled his income protection insurance policy (‘the policy’) and declined a claim made on it. After Mr A made a claim on the policy, Vitality Life Limited concluded that he’d made a reckless qualifying misrepresentation when applying it. So, it voided the policy and declined the claim. What happened I issued a provisional decision earlier in January explaining why I was intending to partially uphold this complaint. An extract of my provisional decision is set out below: ……………………………………. Was the person who arranged the policy acting as agent for Vitality or Mr A? Mr A says that the financial advisor who arranged the policy – and took him through the application for the policy – was an agent of Vitality’s. Mr A has provided a letter dated January 2025 sent to him by Vitality which says the organisation he bought the policy through is no longer authorised to market or sell Vitality insurance and can therefore no longer assist him with the plan. However, by itself, I don’t think that’s persuasive evidence that the financial advisor was acting on behalf of Vitality. Vitality says the agent is independent and was acting for Mr A, not on behalf of Vitality. I’ve looked at the record of electronic submission (reflecting the answers submitted to the questions asked on the application for the policy). The declaration refers to authorising the financial advisor to act on Mr A’s behalf in relation to matters indicated in the form. I’m more persuaded that this supports what Vitality says. On the balance of probabilities, and in the absence of other compelling evidence that the financial advisor was acting on behalf of Vitality, I’m satisfied that they were acting for Mr A. Vitality’s decision to cancel the policy and decline the claim When determining this issue, I’ve taken into account the relevant ABI Code of Practice for managing claims for individual and group life, critical illness and income protection insurance products. I’ve also considered The Consumer Insurance (Disclosure and Representations) Act 2012 (‘CIDRA’) as I’m satisfied this is relevant law in this case. CIDRA requires consumers to take reasonable care not to make a misrepresentation when taking out a consumer insurance contract. The standard of care is that of a reasonable consumer. And if a consumer fails to do this, the insurer has certain remedies provided the misrepresentation is - what CIDRA describes as - a qualifying misrepresentation. For it to be

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a qualifying misrepresentation the insurer (in this case Vitality) has to show it would have offered the policy on different terms or not at all if the consumer hadn’t made the misrepresentation. CIDRA sets out a number of considerations for deciding whether the consumer failed to take reasonable care. And the remedy available to the insurer under CIDRA depends on whether the qualifying misrepresentation was deliberate or reckless, or careless. Vitality has cancelled the policy and declined the claim made on it. It’s recently said that it considers Mr A acted deliberately or recklessly by not answering a medical question correctly on the application form. Had he not done this, Vitality says it wouldn’t have offered the policy at the time. So, it says it was entitled to cancel the policy, decline the claim and retain the premiums Mr A paid for the policy up to the date of cancellation. I know Mr A will be very disappointed, but I’m intending to find that Vitality has acted fairly and reasonably by doing this. I’ll explain why. The application form completed by the financial advisor suggests that Mr A was asked many questions about his health and medical history. This includes: Your health in the last five years… Apart from any condition you have already told us about, have you had any of the following in the last 5 years: Any pain or other problems relating to your back, neck, joints, bones or muscles including arthritis, ankylosing spondylitis, rheumatism or gout? I’m satisfied this question was reasonably clear and it’s reflected that this question was answered ‘no’. This question and answer are also reflected on the confirmation schedule which Vitality says was sent to Mr A by post on 20 December 2023 and also made available via Vitality’s digital and online portal for him to review. Further, Vitality’s letter dated 20 December 2023 (which I think more likely than not was sent to and received by Mr A) says: Your plan has been set up using the details shown on the attached confirmation schedule in section 1. This reflects the information sent to us electronically by your financial adviser. This confirmation schedule forms part of the basis of the agreement between you and Vitality for the provision of the… plan, so you must check this document for accuracy and completeness… If you need to advise us of any changes or errors, please complete section 2 at the end of schedule and return to us… The confirmation schedule says: These are your application details, please check them carefully. CIDRA says a failure by the consumer to comply with the insurer’s request to confirm or amend particulars previously given is capable of being a misrepresentation.

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Based on the medical evidence, I’m satisfied that Vitality has fairly and reasonably concluded that Mr A answered this medical question incorrectly and that he made a misrepresentation. That’s because: • In early 2022, Mr A presented to his GP with a history of back pain after lifting boxes and was signed off work for two weeks with “back pain”. • In April 2023, he presented to his GP with a two-week history of left buttock pain radiating from his hip. And the GP observed that his left hip showed pain on flexion and rotation on both sides. • In June 2023, he presented to his GP with neck pain radiating to his right shoulder. • In July 2023, he presented to his GP with generalised body aches and lower back pain, asking for a GP certificate signing him off work. It’s reflected that the GP told him to ‘self-certify’ for seven days. • A few weeks after the policy started, his GP records reflect (in January 2024) that he presented to his GP with a one month history of left hip/lower back pain. I’m persuaded the answer to this question mattered to Vitality. It’s provided underwriting evidence that it wouldn’t have accepted the application for income protection at the time had it been made aware of these medical issues. I’m persuaded by this evidence. I’m therefore satisfied that it wouldn’t have offered the policy to Mr A and the misrepresentation was a ‘qualifying’ one. Vitality has concluded that Mr A’s misrepresentation was deliberately or recklessly made. I’m conscious that it’s for Vitality to show this on a balance of probabilities. If Mr A is right and the financial advisor didn’t ask him the medical question, I don’t think it’s fair and reasonable to hold Vitality responsible for that. The financial advisor was acting as Mr A’s agent and anything done by them is on behalf of Mr A. Subject to being aware of anything obvious to the contrary, Vitality is fairly and reasonably entitled to rely on the information provided on the application to be accurate. Further, Vitality did provide Mr A with a copy of the questions asked, reflecting how they were answered. In the absence of anything showing otherwise, I’m satisfied it’s fair to presume that he did receive the letter sent to him dated 20 December 2023 (by post) with this information. And that this was also accessible to him via Vitality’s online and digital portal. As the answer to the medical question above wasn’t right, I’m satisfied that Mr A has acted recklessly by not contacting Vitality to change the answer from ‘no’ to ‘yes’. So, I intend to find that Vitality has acted fairly and reasonably by concluding the qualifying misrepresentation was at least reckless. That’s because Mr A had experienced a number of issues with his back, neck and hips in the year leading up to applying for the policy and on one (earlier) occasion, had been signed off work because of back pain by his GP. Based on the medical evidence from January 2024 (shortly after the policy started), I also think Vitality has fairly concluded that he’d been experiencing hip and lower back pain around the time of applying for the policy. So, I think this medical issue should have reasonably been on his mind as it was a current (and recurring) issue.

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I’ve looked at the actions Vitality can take in line with CIDRA if a qualifying misrepresentation was deliberate or reckless. It can avoid the contract of insurance, refuse all claims and doesn’t need to return any premiums paid for the policy. That’s what Vitality has done here and when doing so, I think it’s acted fairly and reasonably by relying on CIDRA. Other issues The final response letter dated June 2025 reflects that the policy had been cancelled from inception. However, Vitality continued to collect monthly premiums from Mr A’s bank account. I don’t think that was fair and reasonable as the policy had been cancelled. I’m satisfied that Vitality should reimburse Mr A for the premiums paid for the policy together with simple interest at the rate of 8% per year. Vitality also accepted that there were customer service issues and that the claim under the policy should’ve been registered earlier. It’s apologised, said internal feedback has been provided and offered £200 compensation to Mr A to for distress and inconvenience. I’m satisfied these errors would’ve been frustrating for Mr A and he was put to unnecessary inconvenience at a time when he was vulnerable. However, I’m satisfied that £200 compensation fairly reflects the impact Vitality’s errors had on him. …………………………………. I invited both parties to provide any further information in response to my provisional decision. Vitality accepted my provisional decision. Mr A didn’t. He felt Vitality had acted unfairly – particularly because it continued to collect the monthly premiums after the claim had been declined. He said Vitality should pay £2,000 compensation. 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’m satisfied that there isn’t a compelling reason for me to depart from my provisional findings. Neither party has provided any further substantive new issues for me to consider. I remain of the view that £200 compensation to reflect the distress and inconvenience Mr A experienced is fair and reasonable. And I think it’s fair that that reimburse Mr A for the premiums it continued to collect since the effective date the policy was cancelled together with simple interest – as set out below. For this reason, and for reasons set out in my provisional decision (an extract of which is set out above and forms part of this final decision), I partially uphold this complaint. Putting things right I direct Vitality to: • pay £200 compensation to Mr A for distress and inconvenience (if not already done so). • reimburse Mr A for the premiums paid for the policy since the effective date of cancellation together with simple interest at the rate of 8% each year from the date

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on which each of the monthly premiums were collected to the date they’re reimbursed*. *If Vitality considers it’s required by HM Revenue & Customs to take off income tax from any interest paid, it should tell Mr A how much it’s taken off. It should also give him a certificate showing this if he asks for one. That way Mr A can reclaim the tax from HM Revenue & Customs, if appropriate. My final decision I partially uphold this complaint to the limited extent above and direct Vitality Life Limited to put things right as set out above. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr A to accept or reject my decision before 20 February 2026. David Curtis-Johnson Ombudsman

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