A radio ad promoted Direct Line Landlord Insurance and featured two characters discussing the service. The first character stated, "You own this place?" The second responded, "Yes, and you are?" The first said, "Winston Wolf. Direct Line. So you're a landlord? A property magnate? A wise guy?" To which the second said, "I wouldn't go that far, it's just my wife's old flat." Winston Wolf then queried, "But you have Direct Line Landlord Insurance, right? After all, they'll pay to repair or replace your broken boiler as standard." The voice-over then stated, "Boiler cover as standard ... Boiler cover with buildings cover..."
The complainant, who believed that the majority of landlords who owned flats would not qualify for boiler cover because he understood that buildings insurance was usually arranged by the freeholder or managing agent, challenged whether the ad was misleading.
UK Insurance Ltd, trading as Direct Line, said the definition of a landlord was an owner of land, buildings or dwellings. On that basis, under the terms of their landlord product, all landlords would be entitled to purchase buildings insurance and benefit from the boiler cover within the product. They said the complainant's concern appeared to lie in the distinction between leaseholder and freeholder. They said a freeholder would come under the definition of landlord as they were owners of the building. Leaseholders generally did not own the property so were unlikely to obtain buildings insurance unless they were held legally responsible for the building by the freeholder. Therefore, it was legally possible for a leaseholder to have buildings insurance. However, they did not use any of that terminology as a customer might not understand the difference, which could lead to confusion.
Direct Line stated that their standard Landlord Insurance product consisted of both buildings cover and contents cover. Any landlord wishing to buy their product was able to choose whether to opt out of either the buildings element or the contents element as well being able to add optional extras such as employers’ liability, to meet their individual requirements. Direct Line also provided data regarding the number of their customers who let out flats and had taken out buildings cover. They did not hold any statistics regarding the split of leasehold and freehold customers, but stated that 53.4% of their customers who let out flats had taken out buildings cover with them. They noted that the laws had changed in the last decade and purchasing the freehold had become much simpler and more obtainable, which supported the trend they saw of over half the policies they sold, across all products, being a joint buildings and contents insurance policy, and over half of landlord policies sold also being a combined buildings and contents policy.
They believed the ad clearly portrayed a landlord as an owner. As landlords were entitled to purchase buildings insurance, they did not believe the ad was confusing. Further, they highlighted that the ad made explicit that the offer applied to "boiler cover with buildings cover". Therefore, they believed listeners would understand that it was a feature of their cover that was included with their buildings (rather than contents only) cover.
The RACC felt that the radio ad clearly promoted buildings cover for landlords and they understood that over 50% of Direct Line customers who let flats took out the advertiser's buildings cover. They were satisfied that the cover offered repairs or replacements to broken boilers as standard.
The ASA understood that Direct Line insurance customers could opt out of buildings or contents cover depending on their personal circumstances, and that the free boiler cover was only available to those customers who purchased buildings cover. We also understood that flat owners could be leaseholders or freeholders, and noted that over half of Direct Line's customers, who had taken out buildings cover with them, were flat owners. We considered that the conversation between "Winston Wolf" and the man established that the man owned the flat and that he was eligible for Direct Line insurance. Therefore, we considered that the offer, in and of itself, was legitimate as a number of flat owners would require buildings cover and would be eligible for free boiler cover.
We noted that when "Winston Wolf" mentioned Direct Line Landlord Insurance, he stated "… they'll pay to repair or replace your broken boiler as standard", and that the voice-over opened with the claim "Boiler cover as standard". We considered listeners would understand from those claims that boiler cover was included with Direct Line Landlord cover generally, and would not be aware of any exclusions. We considered that that impression was contradicted by the voice-over towards the end of the ad, which stated, "Boiler cover with buildings cover". We considered that the fact the boiler cover was only included for those purchasing buildings cover was significant information that could determine whether a listener decided to enquire further about the product, or applied for cover. Therefore, because we considered that the ad did not make sufficiently clear that boiler cover was only included with buildings cover, we concluded that it was misleading.
The ad breached BCAP Code rules
Advertisements must not materially mislead or be likely to do so.
Advertisements must not mislead consumers by omitting material information. They must not mislead by hiding material information or presenting it in an unclear, unintelligible, ambiguous or untimely manner.
Material information is information that consumers need in context to make informed decisions about whether or how to buy a product or service. Whether the omission or presentation of material information is likely to mislead consumers depends on the context, the medium and, if the medium of the advertisement is constrained by time or space, the measures that the advertiser takes to make that information available to consumers by other means. (Misleading advertising) and 3.10 3.10 Advertisements must state significant limitations and qualifications. Qualifications may clarify but must not contradict the claims that they qualify. (Qualification).
The ad must not be broadcast again in its current form.