Nationwide Building Society · DRN-6227305

The complaint Mr R has complained that Nationwide Building Society (“Nationwide”) mis-sold him a fee- paying Flex Plus account in 2015. In summary, Mr R says that the account was mis-sold because Nationwide failed to make him aware of how much the mobile phone excess would be, should he need to claim. Mr R says that the mobile phone insurance included with the packaged account was unsuitable, as the policy is not designed for customers with cheap mobile phones. Mr R also says that he was given misleading information about a ‘free’ overdraft facility included with the account. Mr R has also complained that Nationwide didn’t send him information about his account in more recent years. What happened After Mr R referred his complaint to this service, Nationwide said that Mr R had complained too late about the sale of his packaged account, for this service to be able to consider his complaint. I issued a decision on 31 December 2025, explaining why this service is able to consider the complaint. One of our investigators then went on to consider the merits of Mr R’s complaint. In summary, they partly upheld the complaint. They didn’t think that the Flex Plus account had been mis-sold. But they did conclude that Nationwide had not sent Mr R the annual eligibility statements (AESs), that it was required to send, between 2021 and 2024. They concluded that this prevented Mr R from checking whether the account continued to meet his needs. So the investigator recommended that the account fees be refunded from 2021. Mr R didn’t agree with the investigator’s conclusions, so the matter was referred for an ombudsman’s decision. I then issued a provisional decision on 2 March 2026, explaining why I was minded to not uphold the complaint. I have included an extract of my provisional decision below and it forms a part of this decision. “What I’ve provisionally 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. We’ve explained our approach to complaints about packaged accounts on our website and I’ve used that to help me decide this complaint. And having considered everything, I’m currently mined to not uphold this complaint. I will explain why. Mis-sale Mr R says that his Flex Plus was mis-sold. He says the reasons it was mis-sold was that he took it out mainly for the mobile phone insurance that is included with the

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account, but says that Nationwide failed to make him aware of the excesses applicable to claims. Mr R also says that the account included a misleading ‘free’ overdraft benefit. Mr R says he went on to incur overdraft charges. I have firstly considered whether the account was sold on an advised or non-advised basis. Mr R applied for the account online, and from what I have seen, the Flex Plus account was sold on a non-advised basis. This is an important distinction to make, because if it was sold on an advised basis, this means that Nationwide would’ve been required to check if the insurance benefits included with the account were suitable for Mr R’s circumstances. But as I’m satisfied it was a non-advised sale, then it was up to Mr R to decide for himself, whether the benefits met his needs. However, to ensure that Mr R was able to make an informed decision whether the account met his needs, Nationwide was required to provide Mr R with clear, fair and not misleading information about the account and the associated benefits. Due to how long ago the sale took place, there is now limited evidence available to show what exactly Mr R was presented with during the sale. But to help me decide this complaint, I have reviewed an archived version of Nationwide’s website from 2015, to see what Mr R was likely to have seen when applying for the Flex Plus account. One of the reasons why Mr R says the account was mis-sold is because he says the mobile phone insurance included with the account was unsuitable for him because he only had a cheap phone. Having reviewed what the Flex Plus section of Nationwide’s website looked like in 2015, it provides a summary of the benefits included with the account. Under the mobile phone section, it provides a summary of various things such as the levels of cover, key exclusions - as well as the excesses that apply when claiming. Specifically, it explained that the excess for iPhones was £100 for ‘lost or stolen’ claims and £50 for damage claims. For phones from other manufacturers, the excess was £50 for a lost or stolen phone, and £25 for damage claims. The above information would’ve been presented to Mr R, before starting the account application process. So, I’m satisfied that Nationwide likely provided Mr R with the necessary information regarding the various excesses, so that he could make an informed decision about whether the product was suitable for his circumstances or not. Having read Mr R’s response to the investigator’s assessment, it seems that he is arguing that there was no insurable interest and therefore a refund of the premium is warranted. But I don’t think that is the case here as Mr R was still able to claim under the policy. Mr R explained the value for his phone was around £140, so it was above the amount of excess that would be applicable to claims. And importantly, the monthly fee is for the account in total, and not just the mobile phone insurance. For example, it also included a fee-free overdraft benefit that, from what Mr R says, he was attracted to as well. Another reason why Mr R says that the account was mis-sold, is because he says it included a misleading ‘free overdraft’ offer. Mr R says he went on to incur overdraft charges. Again, I can see this feature of the account was explained in the Flex Plus account summary information on Nationwide’s website in January 2015. It explained that the fee-free overdraft was only for the first three months. After which, the first £100 of an overdraft would be fee-free (although I understand this changed in later years, so that the first £50 of an overdraft facility was interest free).

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I can’t see anything misleading about how this offer was explained. I’m satisfied that it was made clear the ‘full’ fee-free overdraft feature only lasted for the first three months. And I’m satisfied that it was presented in a way to make it clear that it was only a temporary feature of the account. So overall, I’ve not seen anything to suggest that Nationwide had provided Mr R with unclear or misleading information regarding the above benefits during the sale of the account. I’m satisfied Mr R was given a reasonable opportunity to review the account features - including the mobile phone insurance - before deciding whether to go ahead with the Flex Plus account. And ultimately, if it was the case that Mr R chose to go ahead with the Flex Plus account package - even though he now says the mobile phone he had wasn’t worth insuring – in the circumstances, that is not something Nationwide can reasonably be held responsible for. As such, based on everything I have seen and what Mr R was likely presented with when he applied for the Flex Plus account, I am currently unable to conclude that it was mis-sold in first instance. Annual Eligibility Statements As well as providing Mr R with clear, fair and not misleading information about the account during the sale, Nationwide was also required to send Mr R annual eligibility statements (AESs). The purpose of these was to provide a summary of the insurance benefits included with the account and to invite Mr R to check that he was still eligible for them and that they were still suitable for his circumstances. I can see that Nationwide did send AESs to Mr R, at least initially. Mr R says he didn’t receive any from 2018. But Nationwide has provided evidence to show they were sent to him up until January 2020. However there does appear to be a gap between 2021 and 2024, when an AES wasn’t sent to Mr R. Nationwide says that, due to a systems upgrade, it is now unable to retrieve some of the AESs that were sent to Mr R. However, I’m aware that there was a period of time where, due to a technical glitch, not all of Nationwide’s Flex Plus customers were sent an AES. And it seems likely that Mr R was one of those customers here, given that Nationwide has been able to provide copies of AESs sent to Mr R from before 2021 and in 2025. I have therefore considered whether this omission means that, as recommended by the investigator, Nationwide should refund Mr R the account fees going back to January 2021. In order for me to say that a refund of account fees is reasonable redress I would need to be satisfied that, had an AES been sent to Mr R between 2021 and when he made his claim in 2024 then he would have chosen to downgrade his account. But having considered everything, I currently don’t think that he would’ve. I say this because I can see that prior to the period when Nationwide failed to send Mr R AESs, the AESs that were sent to Mr R did include information about the mobile phone insurance. But it only explained what the maximum excess was (for an iPhone), rather than what the excess may be for the different types of claims and different manufacturers. The relevant section of the AES referred Mr R to check the policy document to see full information regarding the excesses applicable to claims. In my view, this was reasonable, as it highlighted what the most Mr R could be

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charged in excess (if he had an iPhone) if he were to make a claim, but also indicated that the excess could be lower and explained where he could find more detailed information. I appreciate that Mr R may not have had an iPhone, and so telling him about the excess for an iPhone won’t necessarily have made him aware that the account was not suitable for him. But equally, even though Mr R was repeatedly made aware over a number of years what the maximum excess could be, this clearly didn’t put him off from keeping the Flex Plus account. Therefore, even if Nationwide had sent Mr R AESs between 2021 and 2024 - and provided similar reminders of what the maximum excess could be - I’m not persuaded that Mr R would’ve acted any differently. I say this especially given that Mr R also claimed on the breakdown cover included with the account in 2023 as well, which suggests he was interested in more than just the mobile phone insurance around that time. As such, although I do think that Nationwide didn’t get everything right and it seems that it hadn’t sent Mr R an AES for a period of time, currently I don’t think that this caused any detriment to Mr R. Because of this, I currently don’t think that any refund of account fees is warranted here. After I issued my provisional decision, Mr R responded disagreeing with the provisional decision. Mr R made a number of points, including that the conclusions I reached regarding the AES not being sent to him, conflict with the conclusions I reached in my jurisdiction decision. Mr R says that two of the four main benefits of the Flex Plus account provided no economic benefit to him. Mr R also requested that the redress proposed by the investigator be reinstated. 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 reconsidered this complaint, including Mr R’s responses to my provisional decision, I still don’t uphold this complaint. Whilst I won’t necessarily address every point raised, I would like to assure Mr R that I have considered his responses in full. In his responses to my provisional decision, Mr R accepted my findings regarding the sale of the packaged account. But Mr R didn’t accept my findings regarding the AESs not being sent to him for a period of time. So I have mostly focused on that aspect of the complaint here. Mr R says that my provisional decision concluded that Nationwide had failed to do what it was required to do, but no remedy was awarded for that failing. Mr R says he acted with ‘complete immediacy’ once he had sufficient information to conclude the account had no continuing value. Mr R says the proper inference, consistent with the investigator’s finding, is that adequate AESs would have prompted that action materially earlier. I have considered Mr R’s points about this issue. However, I think it may help to explain that when considering complaints, if I have identified that a financial business has done something wrong or acted unfairly or unreasonably, I still need to determine what detriment, if any, this caused the consumer. In this case, I concluded that Nationwide had likely failed to send AESs to Mr R in January 2021, January 2022, January 2023 and January 2024. I then went on to consider what detriment, if any, this may’ve caused Mr R. And based on what I have seen, I can’t see that it did cause any detriment to Mr R.

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In summary, I reached this conclusion because the AESs that had been sent to Mr R prior to January 2021, contained information regarding the maximum excess that applied to claims on the mobile phone insurance. They also signposted Mr R to where he could find more information about the different excesses that apply within the mobile phone insurance policy, should he wish to check. Despite being sent that information in the years prior to 2021, that clearly didn’t put Mr R off from keeping the Flex Plus account. So I didn’t think that Mr R would’ve acted any differently, even if he’d been sent similar information in January 2021, 2022, 2023 and 2024. Therefore, I don’t think a refund of the account fees is warranted for the period of time that AESs weren’t sent to Mr R. Mr R says that the reasoning used in my provisional decision is inconsistent with my jurisdiction decision. But I disagree. I say this because in my jurisdiction decision, I was considering whether the information contained in the AESs reasonably should’ve made Mr R aware that he had cause to complain. And I didn’t think he necessarily should’ve known he had a cause to complain from the contents of the AESs. But just because a document doesn’t contain enough information to have made a consumer aware they may have cause to complain (about the specific issue they now are unhappy with), it doesn’t necessarily mean that document was defective or that the financial business has done something wrong by not including that information. In this case, I think summarising what the maximum excess applicable is i.e. providing a worst case scenario, and referring the account holder to the policy wording for more detail i.e. when a lower amount of excess may be applied, is not unreasonable. Mr R referred to the Financial Conduct Authority’s (FCA’S) thematic review and the relevant rules and says that the AES should include all details of the qualifying requirements, and shouldn’t refer the account holder to other documents. But the point Mr R is referring to is in relation to the qualifying requirements to be eligible for the insurance benefit. Here I’m referring to the excesses applicable to claims, which is not a matter concerning eligibility. So, I don’t think Nationwide has acted unfairly or unreasonably if it didn’t list all of the lower amounts of excess that may apply to mobile phone claims, in the AESs that it sent to Mr R. Mr R says that the burden of proof has been switched and lays with the business. Again Mr R has referred to the FCA’s thematic review, which said that in finely balanced situations, businesses should give the consumer the benefit of the doubt. However, that section of the FCA’s review is explaining what the financial businesses (rather than this service) were expected to do, with finely balanced situations, when complaint handling. Whereas for this service, where matters are in dispute and evidence is incomplete, I’m required to decide matters on a balance of probabilities. In other words, I have to decide what I think most likely happened, based on all of the evidence that is available. Another point Mr R has made is that an excess of £50 for a phone worth £140 provides no economic benefit. But I have to be mindful that the account was sold as a package. The monthly account fee Mr R paid, was in return for all of the account benefits – not just the ones Mr R was interested in. And as I concluded in my provisional decision, the account was sold on a non-advised basis, so it would’ve been up to Mr R to decide whether the packaged account was worth having or not. And I thought that Mr R was provided with enough information during the sale of the account, so that he could make an informed decision about whether the account was a reasonable fit for his circumstances or not. Therefore, I am unable to say that Nationwide mis-sold the account because, with the benefit of hindsight, Mr R now believes the packaged account provided little benefit to him. Mr R has also commented on the changes made to the overdraft. He says that the AES is the mechanism through which a material adverse change of this nature should have been communicated to him. However, as the thematic review document (that Mr R has referred to)

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explains, the AESs are designed to only address the insurance benefits included with the account. I wouldn’t necessarily expect them to contain information about non-insurance benefits – such as overdraft features - that are also included with the account. So again, I can’t reasonably conclude that Mr R would’ve acted any differently, had he been sent the AESs between 2021 and 2024. And although Mr R believes that this service should obtain detailed information on the history of changes that were made to the overdraft benefit included with the Flex Plus account, I don’t deem that to be necessary here. This is because Mr R complained that the overdraft benefit was misleading. But, as I explained in my provisional decision, I didn’t think it was, because I thought the information about the overdraft benefit was made clear during the sale of the account. Finally, I note that Mr R says he was denied the right to respond to Nationwide’s response to the investigator’s partial uphold assessment. To clarify, Mr R’s complaint was referred for an ombudsman’s decision because he (rather than Nationwide) didn’t agree with the investigator’s conclusions. Since the complaint was referred for an ombudsman’s decision, Nationwide has responded and I can see the investigator shared Nationwide’s response with Mr R. Nationwide’s response didn’t contain anything new - it was all information that it had already provided this service over the course of the complaint. One of the things that Nationwide said, was that it did send Mr R AES’s between 2021 and 2024, but it was unable to retrieve those copies. As Mr R is aware, in my provisional decision, I concluded that Nationwide had likely not sent him the AESs in that period, due to a known technical glitch. But I also explained why, I didn’t think that meant the complaint should be upheld. Therefore, based on everything that has been provided, I’ve not seen anything that leads me to conclude that this complaint should be upheld. My final decision Because of the reasons given above and in my provisional decision, I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr R to accept or reject my decision before 14 April 2026. Thomas White Ombudsman

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