Appointed representative's gadget insurance and a complaint to FOS

Under s.39 FSMA 2000, an appointed representative is not authorised in its own right; its principal is responsible for the AR's regulated activities. TechCover's permission covers advising on and arranging non-investment insurance contracts, so GadgetGuard's online sale falls within the scope of the appointment. TechCover cannot avoid regulatory responsibility by saying GadgetGuard is a separate company. The customer's complaint is therefore properly directed to TechCover, and FOS can consider it. TechCover may have a contractual indemnity from GadgetGuard, but that is a private arrangement and does not affect the customer's position. TechCover also has duties under the FCA's appointed representatives rules to ensure the AR is competent, adequately controlled and complies with the Consumer Duty. If GadgetGuard's sales process was misleading, TechCover is exposed to enforcement and redress.

Priya is a consumer, so the Consumer Insurance (Disclosure and Representations) Act 2012 applies. The insurer must show a qualifying misrepresentation: a false statement made before the contract. The question asked whether she had had a phone stolen in the last five years. She had, 18 months earlier, but ticked 'no'. That is false. The next issue is her state of mind: was the misrepresentation deliberate or reckless, or careless? She did not read the question, which suggests carelessness rather than deliberate dishonesty. If the misrepresentation was careless, the insurer's remedy is proportionate: it must put itself in the position it would have been in if the truth had been told. That might mean a higher premium, an exclusion for theft, or a reduced payout. Avoidance is only available for deliberate or reckless misrepresentation. The firm's sales process matters: if the question was clear and not pre-ticked, a decline may be fair. But if the design encouraged ticking without reading, TechCover's Consumer Duty and fair treatment obligations are engaged. The outcome is likely a proportionate remedy, not an automatic refusal.

The complaint is in time for FOS. The six-month period runs from the date of the firm's final response, not from the sale. The final response was sent on 10 October and Priya referred the complaint on 20 October, well within six months. The three-year and six-year long-stop rules in DISP also need checking, but the events are recent: the sale was in June and the decline in the autumn. The policy sale date is not the date she knew of the cause for complaint; she knew when the claim was declined. TechCover's argument that the complaint is out of time because the policy was sold on 14 June is therefore wrong. The claim is £1,100, well within the FOS award limit. If Priya also complains about marketing emails, that is a data protection issue for the Information Commissioner's Office, although FOS may consider the firm's conduct if it is part of the same complaint.