Home Claim dispute

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kittypat

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During the recent bad weather we had a burst pipe. Our home was damaged significantly. We employed an assessor ourselves. The insurance company sent out a loss adjustor. A scope of works was agreed. Our builder priced the job at 30k. The loss adjustor said one of their panel of builders must also price the job. He did so (in less than 10 minutes saying he didn't want the job anyway) and came up with a price of 13k. I asked the loss adjustor for a breakdown of their builders pricing of job. Having initially refused he relented. Their builder had not priced 6 items on the scope of workks. The loss adjustor has already told me that they are not prepared to negotiate although i haven't informed him about the 6 missing items yet. Putting that issue aside my own assessor has told me that their builder could not do the job at the price quoted. Has anyone else had a similar experience and if so what course of action would you advise. Should i attempt to negotiate or is their a legal/statutory mechanism that i need to follow. Is there someone who has worked in the loss adjustment area that can advise me. Thanks in advance...
 
Quite simply, all you must do is act in accordance with the terms and conditions of your policy. The Adjuster must do the same. He has appointed a contractor to price the work because the Insurance company has asked him to do so.

Ask that the Insurers builder revise their price to include the missing items of work.( if indeed these are necessary as a result of the water damage).Do the six different items really add up to a price difference of €17k? Is the Assessors price of €30k reasonable? Please bear in mind that Loss Assessors charge as a percentage of the settlement, therefore, the higher the settlement, the more he will charge you.

What is your objective in this situation? I assume that it is to obtain a fair settlement to enable you to get the work done. If the Insurance company contractor has priced the job €13k(albeit this does require some revision), and your Asssessor has suggested that his builder wants more, then if you wish to use your assessors builder, you should be prepared to pay the difference between the revised price from the Insurance company's contractor and the price quoted by your assessors builder. Insurers will not pay a premium so that you can use a contractor of your choice.

If you do not want to do this, i would suggest that you ask Insurers to instruct their contractor to do the work to your home. Also,advise that you will have this work supervised by your own Architect/Engineer/surveyor ( this will be covered by the policy) This way, regardless of the cost of the work, you will have the work completed to your home and because it is being supervised, all the necessary work will be done properly. Insurers will in essence be forced to stand over the performance of this contractor. They will be buying the problem. If the builder screws up, then, go back to insurers and ask them how they intend to sort out the problem caused by their builder. When the work is properly finished, you will be back in the same position following the damage to your home that you were in before the damage occurred. This is what you are entitled to.
 
Many thanks for your speedy reply. I have emailed the loss adjustor requesting that the six items be included. While the six items would not add up to 17k they would/should add up to 5-7k. Your assumption is quite correct in that i am looking for a fair settlemnt to enable me to get the work done. indeed if the price is adjusted upward i also see a case for my assessors builder to adjust his price downward. Thus, paying the difference between both prices would be more manageble.

I also take on board you final suggestion on having the insurers instruct their builder to do the work and make it their problem.

Again thank you for taking the time to give me such a comprehensive reply.
 
A quick update on my situation. The insurance companies loss adjustor has informed me that the six items previously referred to are "included in their builders overall price". Given that my assessors builder has costed these at approx 6k it seems that the loss adjustor is been somewhat disingenuous on this matter. Has anyone had a similar experience or professional knowledge of these situations and if so could you advise. I realise that insurance companies want to pay out as little as possible but there does need to be fairness and tranparency. Thanks in advance.
 
kittypat said:
having the insurers instruct their builder to do the work and make it their problem.
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This is a high-risk strategy. It will be of little consolation for you to be proved right if your house is in a mess. If it is a big enough problem for the builder, he will just go bust.
 
kittypat said:
A quick update on my situation. The insurance companies loss adjustor has informed me that the six items previously referred to are "included in their builders overall price". Given that my assessors builder has costed these at approx 6k it seems that the loss adjustor is been somewhat disingenuous on this matter. Has anyone had a similar experience or professional knowledge of these situations and if so could you advise. I realise that insurance companies want to pay out as little as possible but there does need to be fairness and tranparency. Thanks in advance.
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If you look at it from the Loss Adjusters perspective, you should appreciate that what is has done is acted upon the instructions of Insurers. He/she has appointed a reputable contractor ( whether people realise it or not, the contractors appointed onto insurers panels are indeed reputable) who has advised that they can carry out the repair work to your home at a cost of €13k. In such circumstances, how can the adjuster possibly justify to your insurers that payment be made in excess of this amount? Sorry, I must fundamentally disagree with you when you suggest that the adjuster is being disingenuous, he/she is merely doing their job and on the basis of what you have outlined, i would suggest that he/she is doing their job properly.

Insurance companies have a contractual obligation to indemnify you in accordance with your policy cover. It is not a case of paying out as little as possible, it is a case of paying the correct amount which is representative of the reasonable cost of putting your property in the same position as it was prior to the loss. They have appointed a Loss Adjuster and a building contractor who have advised them that the reasonable cost of repairs to your home is €13k. I presume that the adjuster has told you that the builder will do the work for this price. In such circumstances, i fail to see how in any way they can justify paying you more than this.

I will not recap on what i have suggested to you already. However, i will add that there are legal remedies under your policy. You can refer the matter to the Insurance Ombudsman who can give a ruling on this matter. You can also issue proceedings against insurers for breach of policy conditions.
 
Thank you again for your input, i will certainly reflect on your advice before coming to a decision.
 
Thanks for your PM Claimsman, my position is certainly clearer now, a decision is iminent and definitely more easily reached with the benifit of your advice.
 
You should note the loss adjustor works for the Insurer and will look to interpret the policy in the Insurers best interest and least cost settlement. you are correct to employ an assessor to represent your interests. A good assessor will cover their fee in negotiating a settlement and will know how to interpret the policy and negotiate a claim which can be difficult. Eg Does the policy provide new for old cover, professionals fees etc. Will they give you an interim payment to get work started. Don't mean to complicate the situation further and hope this gives you some help.
 
Rico said:
You should note the loss adjustor works for the Insurer and will look to interpret the policy in the Insurers best interest and least cost settlement. you are correct to employ an assessor to represent your interests. A good assessor will cover their fee in negotiating a settlement and will know how to interpret the policy and negotiate a claim which can be difficult. Eg Does the policy provide new for old cover, professionals fees etc. Will they give you an interim payment to get work started. Don't mean to complicate the situation further and hope this gives you some help.
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Adjusters do not actively endeavour to interpret a policy to the detriment or to the favour of any particular party, either the policyholder or the insured. The Policy wording applies to both parties to the contract. Infact, if there is any ambiguity in the policy, then the policyholder will get the benefit. It is not the role of the Loss Adjuster to minimise the cost of settlement. It is the role of the Adjuster to measure the loss under the terms and conditions of the policy.
 
kittypat - At the admission of the builder who attended your house, he has no interest in standing over the works. Call the insurer's bluff and ask them to provide you with a letter from their builder stating that he will stand over his costs and carry out the works for you. He wont give it to them if he has under priced. I also recognise the carry on of the insurer you are dealing with. Take my advice and send them a letter and mark it as a complaint. Request their estimates and the break down of the same. Ask your loss assessor to cross referece this with his own Bill of Costs and see where the difference is in his professional opinion. Promote your intention to esculate the issue to the Financial Ombudsman should they fail to satisfy your concerns.
 
To Rico,Claimsman and Moneyman thank you for your ongoing interest and advice. The saga continues, snail like.
 
Kittypat

Recently two of my friends had cause to claim of the insurance company. In the first claim my friend was visited by the loss adjuster for the insurer who indicated the claim to be worth £2,000. As he had a friend who rather more qualified than the loss adjuster, being a quantity surveyor with the following letters after his name,BSc, ASCS, MRICS; Dip. Proj. Mgt., Dip. Const,Law. When he assessed the claim and the subsequent damage and work that would be involved, the claim was very quickly increased to £8,000 which was agreed in the end by the insurers loss adjuster.

A week later my other friend asked him to attend to his claim after hearing what had happened over the first claim. It was a completely different insurance company with a different loss adjuster. My friend and the quantity surveyor let the loss adjuster assess that damage before disclosing his experience and qualifications. The claim was assessed at £30,000 and when my friends quantity surveyor introduced his experience and qualifications, it was agreed that they would go over the breakdown together with almost every aspect of the claim being challenged to such a point that the claim was agreed to settle at £58,000.

The QS did not charge fees and was not doing it to earn revenues just merely helping his friends. What concerned me is just how many of the insured public accept what the loss adjusters say when in fact they could be losing out on the full value of the claim. To clarify this point, as it is a full and final settlement, any damage or further work that needs to be undertaken once the claim has been settled by the insurance company or the responsibility of the insured not the insurer.
 
dublindublin said:
Kittypat

Recently two of my friends had cause to claim of the insurance company. In the first claim my friend was visited by the loss adjuster for the insurer who indicated the claim to be worth £2,000. As he had a friend who rather more qualified than the loss adjuster, being a quantity surveyor with the following letters after his name,BSc, ASCS, MRICS; Dip. Proj. Mgt., Dip. Const,Law. When he assessed the claim and the subsequent damage and work that would be involved, the claim was very quickly increased to £8,000 which was agreed in the end by the insurers loss adjuster.

A week later my other friend asked him to attend to his claim after hearing what had happened over the first claim. It was a completely different insurance company with a different loss adjuster. My friend and the quantity surveyor let the loss adjuster assess that damage before disclosing his experience and qualifications. The claim was assessed at £30,000 and when my friends quantity surveyor introduced his experience and qualifications, it was agreed that they would go over the breakdown together with almost every aspect of the claim being challenged to such a point that the claim was agreed to settle at £58,000.

The QS did not charge fees and was not doing it to earn revenues just merely helping his friends. What concerned me is just how many of the insured public accept what the loss adjusters say when in fact they could be losing out on the full value of the claim. To clarify this point, as it is a full and final settlement, any damage or further work that needs to be undertaken once the claim has been settled by the insurance company or the responsibility of the insured not the insurer.
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What is the full value of the claim? Some people believe that in the event of damage to their property, they are entitled to the maximum amount of money that they can get from the insurance company. What they are actually entitled to is the fair and reasonable cost of returning their property to the preloss condition, subject to the terms of the policy.If the Loss Adjuster contrives for this not to happen, then quite simply, this is sharp practice.

This loss can be measured in a number of ways. If the project warrants it, a detailed specification can be drawn up and a number of builders asked to price it. Alternatively, a single builder can be asked to provide a quotation. As a policyholder myself who is tired of paying high premium and expects increased premiums again next year, it does disturb me that in your friends cases, competitive quotations do not seem to have been used as the basis of the settlement of the claims. Accordingly, i am a little uneasy that the involvement of the QS may not have resulted in a fair settlement for both parties.

In my extensive professional experience, when a QS or an Assessor gets involved, invariably they introduce notional costs for repairs that is based not upon an actual quotation from a builder. The QS and the assessor increase the amount of the claim to the maximum amount possible. I would stress that is only in the majority of cases, not in all cases. (I cannot and i am not suggesting that this is what has happened in your friends claims).Likewise, this is sharp practice and indeed, where assessors and QS know that a job can be done for less than the amount of the minimum settlement that they will accept from a Loss Adjuster, then quite simply, this stops being sharp practice and it becomes fraud.

Insurers are aware that there is a particular problem with regard to grossly overstated claims submitted by Assessors and Quantity Surveyors and have tried to eliminate this, ironically enough through the scheme that the OP is now experiencing. Insurers will no longer accept notional costs submitted by Quantity Surveyors and Assessors ( regardless of their qualifications) and are insisting more and more upon competitive quotations. The story of your friends claims clearly outline to me that insurers present approach is warranted. As a policyholder, i want to be 100% satisfied that Insurers are paying out the correct amount on every claim, afterall, the more they pay out, the higher we will all pay through our premiums.
 
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