Insurance Company Obligations.

[conny]

A bit morbid I know, but something we needed to discuss recently.

My partners father is 75 next month and at present in hospital with a severe kidney infection.
12 months ago he put a claim in to his house insurance because his bungalow is suffering from subsidence. They have dragged their heels in obtaining survey reports, ground composition etc until about 4 months ago when his daughter kicked their ars*s and threatened them with legal action if they didn't make a decision about what to do. They have now reached a decision to repair the bungalow and place him in temporary accommodation during the repairs.

We are now wondering what would happen if, before they actually start the repairs, her father was to die. Would they still be obliged to carry on with the repairs or does their liability end if he should die? If it did end where would my partner stand regarding having the work finished? Would she have to foot the whole bill or would they pay for the work completed up the time of his demise?

 

[bernardgreen]

I guess the most accurate answer is in the small print of the policy as it could be different for different companies and types of policy.

Nearest situation I am aware of was when the house owner died in a car accident during insurance financed work after flooding. The solictors dealing with the estate "required" that the work be completed at the insurer's expense.

 

[Belboz]

IMHO, the work should continue because buidlings insurance is paid for covering THE BUILDING and not THE INSURED. The BUILDING and the issue (subsidence) won't cease to exist just because the policyholder dies. However, as BG says, check the policy.

I would suggest you look at the possibility of adding your partner as a joint policyholder on the buildings insurance if that is possible. Whilst that would normally be done for couples, it would be worth exploring in this situation to see if it is possible. The premiums may rise though (not that this is probably an issue for your partner)

I would also see if you can get any advice from either The Money Advice Service or The Insurance/Financial Ombudsman via an e-mail or telephone query on a 'no names, no pack drill' basis. I would strongly advise NOT asking the insurance company because this may result in them slowing the claim to a crawl (I wouldn't trust them)

An insurance expert lawyer will also be able to advise you but this will cost you (probably a few hundred quid) to get the advice UNLESS your partner is a member of a profession whose Union (or Staff Association) has legal cover for members where he/she may be able to get advice for free.

 

[conny]

Thanks Bernard & Belboz.

Sound advice from both of you. Will certainly look into the 'need' to get her on as a joint policyholder.

Been to see him today and he is looking a lot better so hopefully we won't need to go down this route but better to be fore armed.

Once again, thanks.

 

[big-all]

my thoughts
its a problem the insurance company has agreed to rectify under the policy
so must complete the agreed work
you must inform them off material changes relevant to the policy
this can include spells when the property is empty for more than a few days
off course the passing off policy holder they must also be informed
i suspect the policy will be cancelled on his passing

 

[KenGMac]

Conny, hi.

For my sins, but please do not tell the board, I work and have been employed for some considerable time in the Insurance Industry, including undertaking Subsidence claims.

On dozens of occasions, unfortunately, the Policy Holder was deceased, I have even undertaken an Insurance claim where the Policy Holder had died some 8 months before the claim was made by the executors, which brings this diatribe to its point which is.

1/. It is imperative that you obtain or get put in place.
A/. A Will clearly delineating who are the executors, I would strongly advise that the Will be drawn up by a Lawyer / Solicitor [in Scotland] using on-line forms can have complications down the line.
B/. Depending on the circumstances it is highly advisable that a Power of Attorney is obtained, every Insurer will require that a POA is in place.

If both of the conditions 1/. and 2/. are met then the Insurer cannot deny to proceed with the claim, this is your safe condition.

Even if the above are not in place, as happens in most of the Insurance claims made the claim will be accepted by the Insurer, BUT [there always has to be a BUT?] if the property is underinsured that is the house is insured for lets say £ 500,000 But its rebuild cost would be £ 900,000 + then the insurer looks at the loss of its Premiums paid and will make a call on that, the pay out can be reduced accordingly.

I would advise that you check the Sum Insured on the Property

Now for what should be the good bit? because the Insurer has admitted "LIABILITY" then the Insurer must, I stress MUST complete the full repair of the property.

Ken.

 

[conny]

Great news Ken. (Anyone would think you worked for an insurance company, )

Thank you so much for that information, especially the last line about them admitting liability. That has certainly helped ease my mind. I spoke to my partner last night and apparently she thinks her Dad has registered her as a 'joint owner' of the property after his wife died 10 years ago. She will check this out, hopefully later to day, to see if its correct. She knows she signed some papers a number of years ago regarding the house.