08 august 2022, 12:48

Financial Ombudsman recovers payment from insurance company in favour of Muscovite for broken bottles in luggage

An insurance company has refused an insurance payment to a Moscow resident in respect of luggage, after which the client, who disagreed with the company’s decision, appealed to the Financial Ombudsman, where the refusal was found unlawful and the insurance company was ordered to pay money for the broken bottles in the luggage.

According to Financial Ombudsman Svetlana Maximova, who ruled in favour of the consumer, the Muscovite had concluded an insurance contract providing for luggage insurance including insurance against the risks of damage, destruction, loss, non-delivery to the destination, loss of whole pieces of luggage.

The passenger had bottles of alcohol in his insured luggage which got broken. The airport staff drew up a report from which it appeared that five broken bottles were found when the box was opened.

The consumer contacted the insurance company, but the financial institution refused to pay. In particular, the company referred to the clause in the insurance rules which states that events caused by or resulting from transportation of food, dyes, chemicals or their spillage (leakage) during transportation are not insured events. The refusal was also motivated by the clause stipulating that insurance coverage did not apply to glass, ceramic, and porcelain items and therefore no insurance payments would be made, Svetlana Maximova says.

“However, there was no information in the insurance rules about the impossibility of paying insurance benefits because of damage to alcoholic beverages. The same rules also prescribe the procedure for payment of insurance compensation for alcoholic beverages based on their weight and not their actual value. Therefore, the arguments of the financial institution to refuse to pay out the reimbursement were not accepted in making this decision,” Svetlana Maximova explains.

She added that the amount of the claim against the insurance company under the Financial Ombudsman’s decision was 10,050 roubles. The insurance company complied with the Financial Ombudsman’s decision and paid the money to the client.

In general, the Financial Ombudsman rarely receives complaints from citizens in disputes with financial institutions concerning luggage insurance, she said. The essence of such disputes is, as a rule, disagreement of consumers with the amount of insurance compensation paid. Consumers also apply in connection with the refusal of financial institutions to pay the insurance benefit due to non-occurrence of the insured event.

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