Case Studies
A Nightmare Claim
A husband and wife, both solicitors, bought a long lease of the lower part of a conversion. Their premises consisted of the ground floor and basement. Unfortunately, neither they nor the solicitor who acted for them in the conveyance picked up the need to notify the building Insurers of their interest in the property. In July 2007 a water main outside their home burst sending a torrent of water into all parts of their home. They contacted building Insurers who initially agreed to meet the claim, and also to pay for the cost of Alternative Accommodation. The couple duly moved into a flat nearby for which Insurers had paid approximately £20,000 for six months’ rental.
The Loss Adjuster who had been appointed by Insurers was very unhelpful, and instead of assisting his Principals’ Insured, put obstacles in their way at every conceivable point. A few months after the incident, acting on the Loss Adjuster’s recommendation, Insurers informed the couple that, since their names did not appear on the policy as co-insured, there was no obligation on Insurers to meet any of the Alternative Accommodation costs, and they would have to repay to the Insurance Company, the £20,000 that they had laid out. Because of the lack of help that they were getting from the Loss Adjuster, the obtaining of quotes for re-instating their home took much longer than would otherwise have been the case. Furthermore, the Adjuster refused to ask Insurers for any interim payments (which would normally be readily forthcoming in circumstances such as these) so the couple were having to expend substantial sums of their own money in order to get the work under way.
Given that Insurers were refusing to fund Alternative Accommodation costs, at the end of the six month lease, they had no alternative but to move back into their home. In the mean time, their first child had been born and their living conditions were far from satisfactory.
At that point they were recommended to us by a friend for whom we had acted in a claim some years previously. We met at the flat and were appalled at what we saw. The three of them were living in what was in effect little more than a building site.
The lowest of the estimates that the claimants had received was for (about) £60,000. They had submitted the building claim together with supporting documentation to the Adjuster. He took the view that no more than £35,000 fell to be paid by Insurers, citing what he claimed was betterment as the difference. And worse, from the £35,000 he advised Insurers to deduct the £20,000 which he claimed Insurers had paid erroneously for the Alternative Accommodation.
By the time we were instructed the claimants were in a bad state, financially, emotionally and domestically. The first thing we did was to convince Insurers that the claimants should indeed have the benefit of cover for Alternative Accommodation. We next obtained an interim payment from Insurers for the full sum of £35,000 for which their Adjuster had said they were liable. This eased considerably our clients’ financial problems.
Then, crucially, we managed to convince Insurers that the only way the claim would be settled was with an Adjuster who was not intransigent and, extra-ordinarily, another Adjuster was appointed. We had a meeting with the replacement Adjuster who, after two hours’ negotiation, agreed to meet the full cost of the repairs at £60,000. Additionally we obtained payment of £10,000 for the clients in respect of the hardship they had been forced to endure during the period after they had to leave the temporary flat.
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