Why the FCA Is Investigating Motability After 52 Disabled Drivers Lost Their Cars

• A Motability customer and data protection specialist has submitted evidence to the Financial Conduct Authority accusing Motability Operations and its insurer of mishandling disabled customers under the Drive Smart driving-monitor scheme.
• Between September 2025 and February 2026, 323 drivers were removed from the Motability scheme for alleged dangerous driving, and 52 of those cases ended with the customer losing their vehicle entirely.
• Motability paused Drive Smart in May 2026 after a wave of complaints, but campaigners say driver removals and lease terminations tied to the scheme have continued regardless.

A Scheme Built to Reward Safe Driving Has Left Some Disabled Customers Without a Car

Motability leases a car to more than 815,000 disabled people across the UK, and for most of them the vehicle is not a convenience. It is how they get to hospital appointments, to work and to see family. A device fitted to the windscreen was supposed to make the scheme safer. Instead it has become the reason some disabled customers no longer have a car at all, and the Financial Conduct Authority has now been handed evidence that could decide whether the way that device is used breaks the rules that protect vulnerable customers.

What Drive Smart Actually Does

Drive Smart uses a small windscreen-mounted device and a phone app, or a black box for customers who cannot use the app, to record how a car is driven. It logs harsh braking, speeding and journey patterns for every named driver on a lease. Motability introduced the programme in phases from September 2025 and made it compulsory for two groups: any driver under 30, and every new customer joining the scheme.

Drivers who score well can earn up to £160 a year in vouchers. Drivers who score badly get a warning called a red week. A second consecutive red week, or four red weeks within twelve months, triggers removal from the scheme for that named driver. By February 2026, 17,146 Motability customers had been signed up to Drive Smart.

How 52 Disabled Drivers Lost Their Cars

Figures released by Motability Operations show that 323 drivers were removed from the scheme between September 2025 and February 2026 for what the company calls proven and persistent dangerous driving. In most cases the lease continued because another named driver was still insured on the policy. In 52 cases, the customer decided they could no longer continue the lease and handed the vehicle back. In some of those cases, the driver who was removed was the disabled customer themselves, meaning their only route to independent mobility disappeared with the car.

Phil Swindin, a long-term Motability customer who drives using hand control adaptations and has spent years working in technology and financial services, has supported four fellow customers through formal complaints. In three of those four cases, the customer did not know they had been enrolled in Drive Smart at all. A named driver was removed from the insurance policy without their knowledge, and Motability Operations then terminated the lease because the vehicle was being driven without valid insurance. All four cases ended in bans from the Motability scheme lasting two to four years.

Swindin says the consequences documented in these cases include cancelled hospital appointments, customers left unable to leave their homes, and family members liquidating savings and pensions to buy a replacement car outside the scheme. He has since set up a support group called Disabled Driver Voice for other customers affected by Drive Smart removals.

Why the FCA Is Now Involved

Swindin has submitted his casework to the Financial Conduct Authority, asking it to review whether Motability Operations and Direct Line Motability, the insurer behind the scheme and part of Aviva, are meeting their legal duties to treat customers fairly. He told the regulator he believes the four cases are “the tip of the iceberg” and describe a systemic pattern of “silent driver removals, cancellations they say they were never told about, contested telematics scores, vehicles lost, and being passed between the operator and the insurer.”

An FCA spokesperson confirmed the regulator uses information like this in its supervisory work and said firms “must treat customers fairly, communicate clearly and provide the right support, particularly for those in vulnerable circumstances.” The regulator did not confirm whether a formal investigation has opened, saying it cannot disclose details of supervisory action for legal reasons. Anyone unhappy with a firm’s response, the FCA added, should escalate their complaint to the Financial Ombudsman Service.

What Motability and Its Insurer Say

Motability Operations paused Drive Smart in May 2026 after widespread customer complaints, and a spokesperson acknowledged the company “did not introduce the programme in the right way” and that the experience for customers “wasn’t where it needed to be.” The company said Drive Smart exists to manage rising insurance costs among higher-risk customer groups and that only drivers under 30 and new scheme customers are required to use it. It said removals only follow repeated red weeks clearly attributed to one driver, and that customers are offered feedback and support before that happens.

Direct Line Motability said the telematics data used in Drive Smart is collected and owned by Motability Operations, and that decisions on removals and lease terminations sit with Motability Operations rather than the insurer. It said it takes its obligations to customers seriously and is committed to treating disabled customers fairly.

What to Do If You Are on the Motability Scheme

If you or a named driver on your Motability lease are under 30, or you have joined the scheme since September 2025, check whether you are enrolled in Drive Smart and read the red week rules that apply to your policy. If a named driver receives a red week warning, ask Motability in writing for the specific journey data and scores behind the decision rather than accepting a verbal explanation. If a driver is removed and you believe the removal was made in error or without proper notice, put your complaint in writing to Motability Operations first, then escalate to the Financial Ombudsman Service if you are not satisfied with the response.

Keep a written record of every red week notification, since a removal can affect a driver’s insurance history and make future cover harder and more expensive to obtain, even years later. Support groups such as Disabled Driver Voice are collecting similar accounts, which may be useful if you want to add your experience to the evidence already sitting with the regulator.

A Scheme Already Under Pressure Over Cost

Drive Smart is not the only source of tension between Motability and the disabled drivers who rely on it. The scheme has also raised charges this year, and campaigners have separately criticised new VAT rules and lower mileage caps affecting recent leases. Taken together, disabled customers describe a scheme that is becoming both more expensive and more punitive at the same time, with less room to challenge a decision once it has been made.

Motability Operations runs its insurance on a shared model, meaning every customer pays into the same pool regardless of their individual driving record. The company argues that Drive Smart protects that pool by identifying higher-risk driving before it leads to a claim, and says the programme is not designed to remove customers from the scheme. But Swindin’s casework suggests the systems built to make that judgement are not always accurate, and that customers rarely have a clear way to challenge a red week score before it counts against them.

Sources:

• Disability News Service: Regulator is asked to probe conduct of Motability Operations and its insurer over Drive Smart distress
• Disability News Service: More than 50 disabled people lose access to Motability vehicle in first five months of Drive Smart scheme