Re: Insurance Companies
"Early in my career I worked for a large UK insurance company ... More reject on spec and squeeze claims down to the bare minimum,"
The insurance industry definitely does not have a good reputation, but I think it's more of a "varies by company" thing. Members of my family have worked at insurance companies more recently than you, and it was very much a different story there (they were also somewhat "scared" of the FOS, as they were upholding a lot of cases at that time).
"A recently published story in the UK about a homeowner who lost his £400,000 home to fire. The LA came out and rejected his claim on the basis he had declared at application he only had 5 bedooms. The LA decided he had 7 despite the fact the two extra rooms were too small to be considered bedrooms under local government guidelines."
Yeah, at first glance, that one didn't make too much sense to me either, although it's somewhat hard to know without all the details (e.g. there is a legally-defined minimum size for bedrooms).
Link to the story for those interested: https://www.thisismoney.co.uk/money/article-5550933/Our-house-burnt-insurer-refused-pay-said-7-bedrooms-not-five.html
"He went to the Ombudsman and lost (since the Ombudsman is essentially operated by the financial service companies)."
It's somewhat of a stretch to say that the FOS is "operated by the financial service companies" - it's funded by a levy/tax on them. It's previous head was very pro-consumer, which upset the industry, and was ultimately removed by George Osbourne and replaced by someone who was more pro-company - since then, there's been an increase in "interesting" decisions. Certainly the one time I had to use them (about 8 years ago, so prior to the change in leadership), they were very good.