Holiday let insurance company not paying out.

I have often wondered what would happen if I had to make an insurance claim on my Spanish holiday home insurance. I have paid the premiums for years and never made a claim. Then, a couple of years ago I changed to a new, reputable company, which markets itself as a company which does not quibble when a claim is made. The facts are as follows:

In August this year a group of 6 adults were staying at the house in Spain, when the drains became blocked. It was impossible to unblock them and we had to re-house them for the last 5 days of their stay. We managed to get alternative accommodation locally for a few hundred euros and gave them 100 euros for the inconvenience. To unblock the drains it was then necessary to smash the tiling in one of the bathrooms and later, the kitchen units had to be dismantled and re-assembled in order to get access to the chamber where the blockage was. We managed to get all of this done very reasonably at local rates.

We then put a claim in. We were told that the company would not pay out if the blockage was caused by a structural fault; but otherwise it would and we would have to provide photographic proof. The builder took photos of the chamber, and found a nappy blocking the exit.

We have now received an email from the company:

"there does not seem to be any damage caused by escaping water and the drain itself was not damaged as such, but blocked. Underwriters are of the opinion that the costs claimed for are outside the scope of the cover offered and that they are unable to assist in this particular instance."

Thus, they are refusing to accept a claim for loss caused by accidental damage by holiday-makers, which I thought was the point of the insurance. If they don't accept loss caused by accidental damage, they probably don't accept loss by malicious damage and what else is there? (they don't accept loss caused by acts of God either)

Also: if they cover drains, as they do, what is the most likely problem associated with drains? Uh, blockages, one presumes. How likely is it that a drain itself would be damaged?

I am now considering my next step and would welcome suggestions. I have not yet drafted my initial response to them.

I have had a couple of experience's with UK insurance companies withholding genuine payments..Or tried to, i had full insurance cover on my shops yet when i had a robbery in one of the vehicle's carrying my shops goods i found out i wasn't covered for the goods in any of the vehicle's, so that got changed to "Goods in transit" and i can still remember now telling the agent i wanted total full no questions asked goods in transit cover,  high cost of any extra cover didn't come into it, months into this cover i had another robbery in one vehicle, these were both genuine robberies.

So now I am at the agents giving him full details, witnesses' etc, back came the answer from the insurance company, nope not covered,  because the driver wasn't in the vehicle at the time of the robbery, it made no sense to the insurance company that had he been in the vehicle their wouldn't have been a robbery, and he had to leave it to collect more goods from the wholesaler. The insurance only covered goods in transit if you were involved in a road accident, like as in knocked out but still in the drivers seat,  and these goods were stolen then.

Short is after arguing for a few months i found out where insurance company's boss lived, wrote to him at his home address, wrote to Lloyds at Threadneedle Street told him, and them, that if this wasn't cleared up, and me paid out by such and such a time, every one of my shops was having a very large poster placed in the window telling everyone who passed what the insurance company and his agents were like, names, telephone numbers, the lot, and how they took your money and wont pay out if needed.

They got in touch via my solicitor and promised me  "Hell would open up"  if I did this, through my solicitor I told them back  "Well pay up because you only have 3 days to go so better you don't hang about" .

All staff and manageress's were told what to do at 9.30 am on the set day, a Saturday, if they didn't hear from me sooner.....At 9.15am the chosen day the agent drove over with the full cheque amount.

Don't give in. 

 I would be very surprised if any insurance policy would include a drain block through careless use.   The conditions within the policy will make t clear if it is an insured event.

I would be very surprised if any insurance policy would include a drain block through careless use.   The conditions within the policy will make t clear if it is an insured event.

In passing: 

                     People letting private properties may not be aware that holiday insurance cover, (flights, losses or thefts etc.) will not cover any claim arising from a private rental property not be habitable.   So if for example a drain was blocked and the owner could not provide suitable alternative accommodation, which resulted in the holidaymaker having to cancel the holiday, the property owner would be totally responsible for the cost of the aborted flights and any other compensation claimed.

Sorry but, you are definitely not covered for carelessness.(Everyone knows you do not out nappies down the drain as they do not degrade)

You should claim against whoever put the nappy down the drain.

I know from my experience of having to deal with many claims for customers that people do not understand, when they take out insurance, what is covered and the differencies between buildings and contents insurance and sometimes the conflict between building insurance that may be part of a community paynent and contents insurance

What they often do is repair the results of any fault, for example if a pipe bursts all of the damages to the infreastructure of the building, walls, doors etc but not repair the actual source or defect. If a roof leaks again they will repair the damages but not the defect, oftening claiming a construction defect

They certainly would not cover, you as explained in your email, a nappy found blocking the drains or any typical blockage but if the pipes burst then yes you would get cover

Even if it was a burst pipe they will not pay for ANY consiquential losses, real example we had a break in, the buildings insurance covered the damages t the door, the contents insurance covered the TV stolen but they would not pay for the costs for me to progress the claim, legal declarations and property access

If you are renting then it is VITAL to advise the insurance company that you will be renting out the property

The key point here is exactly that the drain was not damaged but blocked

Hi inspectahome.

It was holiday let insurance, so specifically designed for rentals.

Also, it would be impossible to say who had put the nappy down the toilet as it was let to different groups of people over the summer and it would have taken a few weeks to get fully blocked, so we couldn't prove any one holiday-maker was responsible. I haven't yet got down to reading all the terms and conditions, but we did receive an email from the company indicating that they would pay out as long as the problem wasn't caused by a structural fault. They have now backtracked on that. 

In the UK last year we had a water ingress under one of our rental properties, which was caused by a neighbour's blocked drains. Although he was completely to blame, our insurance company couldn't get a penny out of him and paid us the full amount, coming to several thousand pounds, with absolutely no arguments. So a problem caused by blocked drains, not of our making, was deemed a completely legitimate claim. I don't see how the principle here is any different.

So a problem caused by blocked drains, not of our making, was deemed a completely legitimate claim. I don't see how the principle here is any different.

The conditions which apply to a policy issued by one company cannot be imposed on another company, even if both companies were in the same country.

Unless the conditions applying to your claim support a claim then you are not covered.

And as I said, be thankful that the people who were renting at the time did not make a claim against you for the interference which was caused to their holiday, as they would have a justifiable claim which you would be obliged to pay,

The difference here I believe is that from the blocked drain there was actually no damage to the property, that the only damage was created when the works had to be done to repair the drain which was blocked by the nappy. The claim was for the repairs to the drain and consiquential losses which the insurance company will not pay for

I have many examples of yes when a drain in another property blocks and floods an apartment below yes the insurance company pays out because the damages were TOTALLY outside the control of the policy holder

I recently had a pipe burst in an onwers property which flooded 2 empty properties below, still owned by the builder, and they claimed on the owners insurance

I was hoping for some constructive suggestions about how to take this further but unfortunately nobody so far seems to have any positive ideas I can use in my approach to the insurance company. I shall therefore get on with it myself.

eggcup I am sorry but what people are trying to explain is the way that it really is, that in this case there was NO DAMAGE to your property, as identified by the insurance company, that the policy clearly excludes a claim for consiquential losses and that the blockage was caused by a previous renters neglegence

I am not certain from your original mail what you are tryimg tp claim for as I am asuming that you received rental income that should havce covered you moving them to another property, that you decided to compensate them which is a nice thing to do but again not a factor in any claim and there was no damage. Normally in the UK or Spain if you have a blocked drain you have to pay for the repairs

Can you perhaps explain how much and what you are expecting the insurance company to pay you for, is there a clause in your policy for loss of rental income because really most policies are really only to cover Public Liability

If this is a UK or Spanish company and you feel that they have not been treated correctly then your only redress is to go to the insurance ombudsman in either country and make an appeal

Ombudsman for Spain and they will deal with enquires in English and Spanish

CUSTOMER OMBUDSMAN
C/ Marqu!s de la Ensenada, nº2, 6ª planta.
28004 Madrid
902 123 235
Fax: 902 123 236
E-Mail: reclamaciones@da-defensor.org

Eggcup

Unfortunately it seems that you really don't want to hear what people are telling you from their own experiences as it wasn't what you expected. Take this further if you wish but I can guarantee you will not suceed and will only waste your time.

My reason for knowing this is that my wife works for a global insurance company dealing with household claims.

Sorry if it isn't what you would like to hear.

In Section One of the policy schedule, which covers buildings it says it covers:

'Escape of water from fixed tanks, apparatus or pipes."

Further on it adds with regard to loss of use and denial of access' that it covers: 'access to the insured building... being rendered impossible by any of the perils covered in section one.

It doesn't say that the escape of water must be clean water, and it was the dirty water which escaped from pipes that caused the problem. 

With regard to the second point, obviously use of the building was rendered impossible. I will use these statements in my next communication with the company.

Thank you inspectahome for the useful details regarding the ombudsman. I may well refer to this, too, in my response.

Eggcup,

I reckon the replies you've had are not unreasonable.  But no-one can give you solid advice without having some experience and reading through your policy - Inspectahomes comments are valid, but I'm not sure that you should approach the Ombudsman on the basis of your comments on this board.  The Ombudsman is probably your last resort, once he says "no" you've lost, so it's probably better not to rush to this phase.

There are a couple of issues with your claim.  Firstly insurance companies like "fortuitous" events which really are totally outside your control.  This sounds a bit like it might have been stupid or careless, I wonder if your position has been explained properly.

Secondly you seem to have gone ahead with the repair work without seeking the insurers approval.  Sometimes that's not a problem, but clearly this incident is one where even if just out of courtesy you should have sought their approval.  If you put yourself in their position and have to write out the cheque wouldn't you wonder if the expense you outline was really justified?  You may have breached a claims condition, so tread carefully.

You need to establish first off if the claim is actually covered under the policy.  It sounds to me that it's possibly a bit iffy and might be a situation where you need to make a case why it should be paid.  If you wish to send me a PM with a complete copy of the policy wording, not just the schedule, I will let you know.  It would help to have copies of the repudiation letter(s) from the insurer also.  But IMHO you may be wasting yours and the Ombudsman's time if you haven't got a good technical argument.

Hi acer. We informed the insurance company the day after the incident occurred and before instructing the reparatory work and they told us to get on with the work, keep them informed and take photos and give receipts, which we did.

As you say, I would only approach the ombudsman as a last resort. I just meant I might tell the company that I would approach the ombudsman if necessary.

I'm not very technical in terms of scanning so I won't be able to do that, but thanks for the offer.

Hi Eggcup,

Thanks for yours and the clarification.  I don't know what been said to the insurer so far, but I really would try to persevere with them first.  But bear in mind that insurance claims people have certain fixations - they want to hear that the damage/loss was caused by an "event" something sudden, unforseen, fortuitous and outside your control etc.  Not, in their language a "gradually operating cause".

If your policy is from a UK source it is likely that there is accidental damage to underground services, but somewhere it'll probably have an exclusion or two.

The policy may well have a "trace & access" extension which might be helpful depending on the exact wording.  Your comments and several others regarding the policy wording are a bit wide of the mark.  The drains are always part of the building - usually the second page of the policy will be headed definitions and one of these will be "buildings" which will be wide and include drains.

If you have "Accidental Damage" cover either in respect of the buildings or an extension specifically for drains your position is even better.  The part you mention about burst pipes is not relevant - that is a different insured peril.

The frequently quoted "Act of God exclusion" does not actually exist in any insurance policy - it is a figment of the imagination of folk who have not read their policy.  Actually "Act of God" is a defence to action in law, nothing to do with a material damage insurance.

Without the policy I cannot be sure, but I believe there is a very good chance that your claim should be paid by the insurer.  If they have authorised repairs your position is even stronger and they must justify their change in stance, so I suggest you write to them summarising what's happened.  I would focus on the nappy which presumably was dropped down the loo in error and represents the essential "sudden and unforseen event" and include a photo of it when you write to them.

But leave the Ombudsman for the time being and ask the insurer to re-consider and if they still decline they must spell out their reason for doing so.  Please do post their response on this thread.

Thanks acer. I will take on board your suggestions. I'm aiming to write to them probably on Monday, as I find it a good idea to wait a few days with these matters, and consider the next move carefully.

Hi Eggcup,

Thanks for a copy of the policy wording received via a PM I've replied in the same way, but I thought I should confirm on this forum to let the doubting barrack room insurance advisors know that IMPO your claim looks good to me.

I've not seen the file or the correspondence but from what you say on this thread and the policy wording I cannot see any way that the insurers can avoid paying out in full, less the £50 excess.

Good luck.

I would like to thank acer for his help with this matter. I have now replied to the company using the suggestions given by acer. As acer says, I believe the claim should have been settled without question. The company states on its website that it prides itself on the minimal of exclusions and it clearly states that it covers this kind of issue.

Had I, of course, listened to other comments I received here, I would have given up at the first hurdle. When one believes an injustice is being committed against one, it is imperative not to throw in the towel. I believe it is possibly policy of many insurance companies to automatically refuse claims in the first instance and it is a shame that they take this approach. Of course it was also disappointing that members on this forum automatically took the side of the insurance company. Why is that, I wonder?

Whatever the psychological cause of such an approach (and readers of my blogs will know I love to examine this kind of thing), I have now taken the next step and will keep you all informed as to how I get on. I believe it is in the public interest to know how these things work, as we all wonder if our insurance companies will pay up when the time comes. And we need to know how to handle it if they don't. Thanks once more to acer.

Well, we've had another negative response from the company saying that the clause we want to claim under is the exact clause which is likely to fail. They don't, however, tell us which clauses might be likely to succeed with the underwriters... I thought they were supposed to be on our side, but they seem to be playing a game with us. I will continue to argue the case, and acer has been helping me with us, but if, in the end, they categorically refuse to pay out, I will be naming and shaming them here, as they are a well-known and respected company and when people realise that their proud boast that they have 'minimal exclusions' is not correct, others may wish to take their business elsewhere and also perhaps some members of the Forum might be able to recommend insurance companies who adhere to the kind of principles that they boast about on their web pages.