Asda car insurance, which is underwritten by Norwich Union, is openly flouting FSA regulations by failing to update its policy wording online, leaving thousands of UK motorists under-insured.
If customers complete their details on Asda's website they will be given the opportunity to view the policy wording in full before purchasing cover.
The wording in this document states: "We will pay you for the value of loss or damage caused to personal belongings by fire, theft or an accident while the belongings are in or on your car."
But when Insurance Times contacted Asda it was told that personal belongings were not covered in the policy. The policy wording on the homepage of Asda's website, which is different to that shown at the point of sale, does not include clear cover for personal belongings either.
An FSA spokeswoman said: "If the policy wording displayed online is different to the cover available to the consumer, there is a clear breach of s5 of the ICOB rules. We would certainly look to take action in such a case."
Biba regulation and compliance manager Steve White said: "This begs the question: is this merely a glitch or a deliberate attempt to mislead?"
The policy wording at the point of sale also states: "If the car keys or lock transmitter of your car are lost or stolen, we will pay the cost of replacing (them)."
Again, when Insurance Times contacted Asda it was told that loss of car keys would not be covered. The policy document on the site's front page also excludes cover for loss of keys.
Brian Brown, associate director of financial product analyst Defaqto, said: "Unfortunately it is not uncommon for insurers to change their policy wording without updating the details online.
"The FSA needs to look closely at how to ensure compliance on this issue."
A spokesman for Norwich Union said: "We will look into this and if there is a contravention of FSA regulations we will rectify that immediately."
