Lloyds Bank has written to Fos rejecting its decision in the case of a man who has been seeking redress for seven years.
The company has insisted that Kevin Arrowsmith did not have insurance with Lloyds, despite a Fos adjudicator ruling this was the case.
In October an adjudicator said Mr Arrowsmith was indeed insured but said the provider, Lloyds Bank, was unaware of the policy as it was held with subsidiary Cheltenham & Gloucester.
Fos also claimed another policy had been set up in branch in 2002 “without Mr Arrowsmith’s knowledge” but was cancelled shortly after.
In a letter to Fos seen by Financial Adviser, Lloyds Bank said: “Apart from the Home Solutions policy being set up in 2002 we do not have any other insurance details or mortgage products for this customer.
“I have enquired about the customer’s bank account from 2001 to 2009 there are no details from the bank suggesting the customer has any home insurance with Lloyds. You say it is distressing for the customer to be told for eight years that he didn’t have a policy with us and that the business should compensate for this. We would welcome your explanation of how we have caused the customer eight years of distress as the customer clearly has to have some responsibility for his own actions.”
The letter from Lloyds Bank also rejected the suggestion made by Fos that it would have been easy to find the details of Mr Arrowsmith’s mortgage account.
Mr Arrowsmith, who lives in Hampshire, began his battle in February 2007 after an alleged theft from his property by contractors he had employed to carry out building work meant he had to seek alternative accommodation for a fortnight.
But after attempting to claim on his insurance for the alleged theft he was told by his provider he had no insurance.
In 2008 he took the issue to Fos which prompted years of confusion between his insurers, the ombudsman and its adjudicators about whether Mr Arrowsmith’s policy had been cancelled and whether the policy was his or his father’s.
At one stage Fos blamed Mr Arrowsmith for the confusion, accusing him in a letter of supplying “contradictory” information which “hampered” the consideration of his case.
But in his decision from October, Fos adjudicator Craig Hard said: “This incident as a whole has left [Mr Arrowsmith] with significant and long-lasting health problems.”
He also said that Lloyds Bank had been “confused” between Mr Arrowsmith and his father.
Mr Hart recommended that Lloyds Bank should compensate Mr Arrowsmith with a payment of £1,000, reimburse him the cost of two weeks’ accommodation and add 8 per cent interest a year from the date he paid for it until such time as Lloyds Bank pays for his settlement.
Mr Arrowsmith insisted he had insurance, saying it was linked to his mortgage but cancelled in 2010.
Since Lloyds has disputed the adjudicator’s findings the case will now be reviewed by an ombudsman, which is the final stage of an investigation and whose decision will be legally binding.
Right to reply
A spokesman for Lloyds said the case is still open so it would be inappropriate to comment.
The Financial Ombudsman Service declined to comment since the case is still open.
