The underwriter for wedding insurance at Debenhams and Dreamsavers has been reported to the financial regulator by Which? after the consumer watchdog said it uncovered dubious tactics to deny payouts for coronavirus wedding cancellations.

UK General Insurance, which is backed by insurer Great Lakes, and sells products through its WeddingPlans website, were advising policyholders as late as March that policies would be paid out.

But after a series of complaints about payouts being withheld, the Financial Ombudsman and Financial Conduct Authority are being asked to investigate.

The spotlight on UK General Insurance comes as businesses continue class-action lawsuits against insurers who refused to pay out following the disruption caused by Covid-19.

Jenny Ross, Which? Money editor, said: “Our research suggests a pattern of UK General Insurance acting in bad faith to turn down claims, which is why we believe the financial regulator must investigate and take tough action if the firm is found to have broken the rules.”

In one case, Lidia Szmid and Adam Burton bought a wedding insurance policy from WeddingPlan in March after receiving written confirmation that they would be covered if the Government closed the venue due to coronavirus, according to Which?

However, the £10,000 claim was rejected and a Subject Access Request suggested employees thought the couple could be committing fraud, despite having informed the company of their situation in advance.

Which? said the experiences of customers at other wedding insurance companies have been significantly better and pointed out that the company’s website appeared to contradict the decision.

WeddingPlan shared online advice in March that it would cover cancellations caused by the “outbreak of a contagious and infectious disease” or venue closures by a “relevant authority”.

But Which? said it failed to disclose ambiguous clauses in its terms and conditions that claims would not be covered if related to “government regulations or acts” or “prohibitive regulations”, without clarifying who the “relevant authority” relates to.

Which? said it has spoken to seven couples battling to have their claim accepted by UK General Insurance, with only Ms Szmid’s paid out.

Ms Ross added: “The persistence of one bride who refused to be given the brush-off by a big insurance company produced a damning dossier of evidence exposing how the firm exploited unclear terms and conditions to avoid paying out on claims.”

UK General Insurance told Which? it is a distributor – not the insurer – and does not have the final say on whether a claim is paid.

A spokesperson said the decision whether to pay claims rests with the insurer, in this case Great Lakes, not the distributor.

UK General Insurance and Great Lakes said in a joint statement: “We acknowledge and regret the lack of clarity in some of the FAQs relating to coronavirus posted on our websites, but we have subsequently thoroughly reviewed the coverage position in respect of claims for wedding cancellations arising from the Covid-19 pandemic, and have republished FAQs and will continue to monitor these as the situation develops.”