Clarion Housing Association Limited (202126890)

REPORT

COMPLAINT 202126890

Clarion Housing Association Limited

19 February 2024

Our approach

The Housing Ombudsman’s approach to investigating and determining complaints is to decide what is fair in all the circumstances of the case. This is set out in the Housing Act 1996 and the Housing Ombudsman Scheme (the Scheme). The Ombudsman considers the evidence and looks to see if there has been any ‘maladministration’, for example, whether the landlord has failed to keep to the law, followed proper procedure, followed good practice, or behaved in a reasonable and competent manner.

Both the resident and the landlord have submitted information to the Ombudsman, and this has been carefully considered. Their accounts of what has happened are summarised below. This report is not an exhaustive description of all the events that have occurred in relation to this case, but an outline of the key issues as a background to the investigation’s findings.

The complaint

The complaint is about the landlord’s handling of the resident’s:
1. contents insurance account.
2. complaint.

Background and summary of events

Background

The resident is an assured tenant of the landlord.
The landlord’s compensation policy sets out a range of awards that can be made to recognise the adverse effect of a failing. It says awards of:
1. £50 to £250 can be made for failings such as repeated failure to reply to letters or return phone calls.
2. £250 to £700 can be made when considerable failure is found such as where the resident had repeatedly had to seek correction of mistakes.
3. £700 and above for failings that have a severe long-term impact on the resident.
At the time of the resident’s initial complaint the landlord aimed to respond to complaints at stage 1 within 10 working days, and those at stage 2 within 20 working days.
In June 2022 the landlord experienced a cyber-security incident which caused disruption to its services. At this time, it introduced an interim complaints policy. This extended complaint response times to 20 working days for stage 1 complaints, and 40 working days for stage 2 complaints.

Summary of events

The resident began contents insurance through the landlord in November 2009. She made fortnightly payments to her rent account for this.
Rent account statements provided by the landlord going back to September 2018 show that:
1. fortnightly payments of £4.34 were made by the resident for the contents insurance up to 9 May 2022.
2. £2.17 was deducted from the resident’s account each week for contents insurance up to 25 March 2019.
3. All the rent and service charges were covered by housing benefit payments, which were mostly paid monthly.
On 2 November 2021 the resident wrote to the landlord. She said:
1. She had contacted the landlord in January 2021 to request a contents insurance claim form after her television fell from the wall.
2. She was told it no longer dealt with the tenant contents insurance scheme and was directed to the insurance company.
3. She had contacted the insurance company, but it had no trace of a policy for her.
4. She needed help to find out where her payments had been going to, but the landlord had not responded, despite her calling every month.
On 23 March 2022 the resident complained to the landlord, referring to her letter of 2 November 2021 – she said she was still awaiting a response. She said she wanted:
1. to know when her contents insurance had stopped, and why.
2. a refund of all payments she had made for it.
The resident sent a further letter to the landlord on 12 April 2022. She said the landlord had left her a voicemail on 28 March in response to her letter of 23 March. She said it had said it was unable to refund money back to her as she had stopped paying into the tenant home insurance in 2019. The resident said:
1. She had continued to make payment for this insurance to date.
2. She had contacted the landlord nearly 20 times to request an insurance claim form, before it eventually told her it had stopped dealing with tenant insurance in 2018.
3. She enclosed bank statements showing she had continued to make payment to the landlord for the insurance up to 11 April 2022.
On 20 April 2022 the landlord wrote to the resident stating that it aimed to provide a response to her complaint in 10 working days.
In internal discussions about the resident’s complaint, the landlord noted:
1. There was no evidence the resident had been told her insurance cover had stopped.
2. It was unclear why she had not been told she did not have insurance when she requested claim forms throughout 2021.
3. While she could make a claim under the landlord’s insurance, it was unlikely this would be accepted.
4. It had decided to pay her £1,350 because of the “high impact” of its failure since June 2019, which it noted was when her insurance cover had stopped.
The landlord spoke to the resident the same day. It noted she was pleased with the compensation offered and with a refund of some of the money she had paid.
On 3 May 2022 the landlord provided the resident with its stage 1 response to her complaint. The landlord said:
1. The resident had been told she had stopped paying into the contents insurance scheme in 2019 but she had provided evidence her payments had continued.
2. Her rent account had last been charged for contents insurance in June 2019, and it did not know why she had been removed from the scheme.
3. There was no indication she was notified of this or told to stop her payments.
4. It was likely that it directed her to the insurer as new customers’ policies were administered by the insurer.
5. It continued to administer content insurance for existing customers.
6. It told the resident in September 2021 that she was no longer covered for contents insurance.
7. She had not been told where insurance payments she continued to make had gone.
The landlord said that it had identified a failing in its service. It said it had awarded £1,350 compensation, which the resident had confirmed she was satisfied with. It said this award was for:
1. Inconvenience.
2. Failure to follow process.
3. Customer chasing for information and updates.
The landlord also said:
1. The insurance payments the resident had continued to pay since 2019 had accumulated in her rent account, which was in credit by £107.83.
2. The resident should provide her bank details if she wanted this amount to be refunded.
3. It was not possible to refund payments the resident had made between 2009 and June 2019, as during this time the resident was charged for contents insurance.
Rent statements around this time show the credit on the resident’s account was £107.83 on 25 April 2022 but increased to £328.25 on 12 May 2022 after housing benefit payment was received.
The resident responded to the landlord on 19 May 2022. She provided her bank details for the landlord to pay compensation. She also queried why her rent account was not more in credit, given the payments she had made for insurance between June 2019 and May 2022.
The landlord responded to the resident on 7 June 2022 stating it would pass the matter to its complaints team. The same day landlord’s customer accounts team wrote to the resident stating that it would process a refund into her bank account within the next 10 working days.
On 11 August 2022 the resident wrote to us. She said she had been mis-sold insurance, which she had been paying for since 2009. She said she had come to an agreement with the landlord that it would pay her £1,350 plus refund the money she had paid since June 2019 for insurance that was not in place. She said she was still awaiting payment by the landlord. On 19 August 2022 we wrote to the landlord setting out that the resident wanted a refund of insurance payments she had made.
The landlord provided a stage 2 complaint response to the resident on 14 November 2022. It apologised for its delayed response, which it said was due to disruption caused by a cyber-security incident.
The landlord said it had found that:
1. The resident was covered for insurance up to December 2018, when it had ceased administering the scheme.
2. It had failed to advise the resident that insurance had ceased but had compensated her for this at stage 1 of its complaints process.
3. As a result of this failing, direct debit rent payments the resident made continued to include an insurance premium until 25 March 2019, but this overpayment was incorporated into her rent balance.
4. This overpayment could not be refunded through its complaints process, but the resident could apply by providing its accounts team with her bank details.
The resident told us that the landlord had paid her compensation of £1,350. However, she said it had not adequately explained what had happened to payments she had made since insurance had stopped. She said it had told her she had insurance until December 2018. But she continued to pay for this cover until May 2022. She said, if this money had gone to her rent account, she would have expected a greater credit to have accumulated. The resident said she wanted the landlord to refund the payments she made for insurance over this 3 and a half year period.

Assessment and findings

The handling of the resident’s contents insurance account

During its consideration of her stage 1 complaint, the landlord identified and acknowledged that it had removed the resident from the contents insurance scheme, and it could not explain why. It also noted she had not been told of this until September 2021, despite making contact in January 2021.
Records provided by the landlord do not show the contact the resident made from January 2021 to request an insurance claim form, but she said she called monthly to try to progress a claim. The landlord has stated that it did not tell her until September 2021 that she was not covered by contents insurance. It is apparent from the resident’s letter of 2 November 2021 that even after this she remained unsure about what had happened to payments she had made. Despite the resident requesting help at this time to trace where payments had been sent, there is no evidence the landlord responded.
It was not until after the resident had sent 2 further letters that she received some clarity from the landlord on 3 May 2022. Clearly the resident should not have had to wait this long for this or spend so much time and trouble chasing the landlord.
In its response of 3 May 2022, the landlord awarded the resident £1,350 for the inconvenience she had experienced, the need for her to chase information and updates, and its failure to follow process. We do not know what the resident might have received through insurance cover for her damaged television. But it is clear that because of failings by the landlord, she had no contents insurance in place during this time. It is also apparent that the resident experienced inconvenience, frustration and spent time and trouble chasing what had happened to her insurance and payments. With consideration of the landlord’s compensation policy, and the Ombudsman’s remedies guidance, we consider the award already made to be an appropriate amount to recognise the impact on the resident of these failings.

The handling of the complaint

The resident first complained to the landlord on 23 March 2022. It is clear it contacted the resident following this as she referred to a voicemail it had left her. But the landlord should also have responded in line with its complaints policy. The resident had set out the trouble she had experienced since January 2021 getting a response to her queries about her insurance. It would have been reasonable for the landlord to consider and respond to these concerns fully. Leaving a voicemail response was not appropriate and is likely to have added to the delay in the resident receiving clarification of what had happened to her insurance.
It was not until after the resident sent a further complaint that the landlord provided a stage 1 response on 3 May 2022. It is noted that the landlord said at this time that the insurance cover had ended in June 2019. But it is unclear where this date was taken from. Rent account records we have seen show the last payment for insurance was taken on 25 March 2019.
After the resident escalated her complaint, instead of providing clarity, the landlord’s stage 2 response added to the confusion. It said the resident’s contents insurance cover had stopped in December 2018, when it stopped administering the scheme. It also said that the resident’s payments for this insurance ended on 25 March 2019. But, as already noted in its stage 1 response, the resident had provided evidence that she had continued to make payments through to May 2022. It appears that the landlord confused payments the resident was making with the debit that was made for this insurance cover.
The resident’s rent account statement shows a debit of £2.17 for insurance cover up to 25 March 2019. This suggests that insurance cover stopped around this time. But, given the confusion and the different dates the landlord has provided, an order has been made that the landlord write to the resident to provide clarity about when her insurance cover ended.
In its stage 1 response the landlord told the resident that payments she had continued to make since June 2019 had accumulated on her rent account, which was in credit by £107.83. Subsequently, on 19 May 2022, the resident queried why more credit had not accumulated in her account. However, there is no evidence the landlord provided an adequate response to the query.
We have seen evidence that payments the resident made for contents insurance were credited to her rent account through to 9 May 2022. The records also show that the level of accumulated credit on her rent account balance fluctuated. The resident had paid in £112.32 per year until 9 May 2022 for insurance cover that stopped around 25 March 2019. Given this, her concern about that the rent balance of £107.83 did not reflect her continued payments was understandable. The landlord has yet to provide an adequate explanation to the resident in respect of her concerns. It should have done so after she queried this in May 2022. In view of this, an order has been made that the landlord contact the resident to clarify this and resolve her concerns.
It is noted that the landlord was delayed in providing its stage 2 response to the resident. While it was experiencing a disruption due to a cyber-security incident, the time take to response went far beyond the extended timescales set out in its interim complaint policy. While the landlord may have been experienced difficulties during this time, it should reasonably have kept the resident updated about when she could expect to receive a response to her complaint. There is no evidence it did so, and this is likely to have added to frustration at the lack of response she had received to her earlier query.
Overall, there was maladministration in the landlord’s handling of the resident’s complaint. It failed to appropriately respond to her complaint of 23 March 2022. It then provided inconsistent and inaccurate information in its stage 1 and stage 2 complaint responses about when insurance cover and payments the resident had made for this had stopped. It failed to provide the resident with adequate clarity in response to her concerns about the amount of credit on her rent account. It was also delayed in providing its stage 2 response and did not keep the resident updated about this.
The award the landlord has already made in respect of its handling of the resident’s content insurance account does not recognise additional time and trouble and frustration to the resident as a result of complaint handling failings. With reference to the Ombudsman’s remedies guidance, an award has been ordered to recognise this.

Determination (decision)

In accordance with paragraph 53(b) of the Housing Ombudsman Scheme, the landlord offered the resident reasonable redress in respect of its handling of her contents insurance account.
In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was maladministration in the landlord’s handling of the resident’s complaint.

Reasons

During its stage 1 consideration of the resident’s complaint the landlord awarded compensation to the resident. We considered that this appropriately recognised the inconvenience, time, and trouble she had experienced, and the impact on her of it stopping her insurance cover without her knowledge.
The landlord’s failed to provide an appropriate response to the resident’s initial complaint. In subsequent complaint responses it provided inaccurate and inconsistent information about when insurance cover, and payments made by the resident for this, had stopped. It then failed to respond to the resident’s concerns about the accumulated credit balance on her rent account and delayed in providing its stage 2 response.

Orders and recommendations

Orders

Within 4 weeks of the date of this report the landlord should:
1. Write to the resident to apologise for the failing identified in its handling of her complaint.
2. Pay the resident £200 in recognition of the impact of its complaint handling failings.
3. Write to the resident to provide clarity about when her insurance cover ended.
4. Contact the resident to clarify the accumulated credit on her rent account. It should explain:
  1. What the balance of her rent account is and how her continued payments for insurance until 9 May 2022 has affected this.
  2. How much can be refunded to her.
  3. If it cannot refund the full amount the resident has paid for contents insurance since cover ceased, it should provide her with a clear explanation of why it cannot do so.
5. Remind staff of the importance of appropriately responding to complaints in line with the landlord’s complaints policy.