Buildings insurance

[RogerS]

Insurance company A provides buildings cover and this was contingent on them carrying out a survey to value the property for rebuilding costs. This then results in the premium payments due.

Then there is a fire and insurance company A now say that the building was underinsured but they NEVER carried out the survey, where does the insured stand?

Any recommendations for a good loss adjuster?

It’s not our house luckily.

 

[Blackswanwood]

I’ve never heard of that type of arrangement before Roger. Presumably there is something unique about the building? The ABI have a building valuation online tool that most insurance companies use.

It’s going to come down to what the policy says about what the sum insured is at the time the loss happened. If the policy had not been issued and there is nothing else in writing I’d suggest the policyholder requests a DSAR which should include call transcripts or recordings as this will evidence what was agreed.

The loss adjuster acts on behalf of and is appointed by the insurance company, the policyholder can appoint a loss assessor to act on their behalf. The Money Savings Expert website has some useful guidance on whether it’s worth going to the expense of appointing one.

Cheers

 

[RogerS]

Thank you Robert. So the sum insured is the figure on the policy? Can the insurance company then turn round and say “You should have insured the building for £x + “

 

[RogerS]

It's Listed.

 

[RogerS]

My friend asked me to convey her thanks, Robert.

 

[PAC1]

If it is a listed building, it is common to need a valuation of the rebuild cost as they can vary significantly from the RICS model. If the insurance company said they were going to get a valuation that is on them. But who provided the value in the insurance policy the company or your friend?

 

[RogerS]

That’s a good question…I will ask.

 

[Blackswanwood]

Roger - in answer to your question at post no 3 ...

It's common for buildings insurance to include a clause which applies what is know as the principle of average. This means that the amount payable will be multiplied by the sum insured/actual value. So sum insured £100k, actual value £200k would result in the claim payable being halved. It's generally (in the standard home market) the responsibility of the policyholder to determine the sum to be insured.

Not all policies are written that way. We're Grade II listed but our policy has a standard £1m rebuilding limit - we've never had to provide a sum insured and there is no average clause. It all comes down to the policy wording.

Cheers

 

[—Tom—]

As suggested request a full Subject access request (SAR) detailing everything they hold.

Request the name of the company/companies they use for valuation services and contact them as they may have on record- though if their client was the insurance company they may not disclose anything. Often depends on how friendly you are and the nature of the person on the other end of the phone. A simple confirmation that it was done should be sufficient.

Don’t be afraid of contacting the ombudsman and the FCA are pretty hot on treating the customer fairly (TCF). So if they’re getting nowhere with insurer then knowing where to seek help is useful.

If the claims team aren’t being forthcoming asking for the details of their head of compliance (who will sit outside of the claims team and be incentivised differently) should help to get their internal machine going.

Keep copies of all correspondence and if they call you request copies of the call recordings whilst on the call.

 

[Cabinetman]

I have always been asked if the property is listed, and following the fire in my workshops neighbour which was a listed building I can well see why, the hoops gone through to save a front wall that was of no value as far as I could see were extremely costly, and it’s now being rebuilt anyway.