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House Insurance Value Question
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alrg500
Posts: 11 Forumite
Hi there after some advice.
I am in the process of buying an end of terrace house, I have had it valued for the mortgage and they have said the Rebuild insurance value is £115,000. I have got quotes for this amount which are reasonable.
Tonight I got a phonecall from the company who are supplying the mortgage trying to sell me their house insurance. It is much much more expensive but includes unlimited rebuild cover, I said no as it was over double my other quotes. The saleswoman then went on to say that if my house burnt down and the next door neighbours house was burnt down as well the other company would pay out for the neighbours first then whatever was left out of the £115,000 would pay for mine to be rebuilt and if not enough then it would not get rebuilt.
I questioned her on this but she was adamant she was correct.
I also mentioned to her why I had paid her company to value the house and they had said I needed cover of £115,000 yet she said it should be unlimited.
Anyone know whether she is correct or wrong?
I am in the process of buying an end of terrace house, I have had it valued for the mortgage and they have said the Rebuild insurance value is £115,000. I have got quotes for this amount which are reasonable.
Tonight I got a phonecall from the company who are supplying the mortgage trying to sell me their house insurance. It is much much more expensive but includes unlimited rebuild cover, I said no as it was over double my other quotes. The saleswoman then went on to say that if my house burnt down and the next door neighbours house was burnt down as well the other company would pay out for the neighbours first then whatever was left out of the £115,000 would pay for mine to be rebuilt and if not enough then it would not get rebuilt.
I questioned her on this but she was adamant she was correct.
I also mentioned to her why I had paid her company to value the house and they had said I needed cover of £115,000 yet she said it should be unlimited.
Anyone know whether she is correct or wrong?

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Comments
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She's wrong. Not only is she wrong, she sounds like a bit of a bullshitter.0
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This woman is either a) lying to you to get your cover b) genuinely does not realise she does not what she is talking about. Either way you should give her company the big swerve. It is shocking that in the current days of regulation by the FSA and their requirements that Insurance Staff are suitably trained and fit and proper that this woman is in the industry.
The reality of the matter is that as a home owner you are only responsible to rebuild you own home not your neighboors, they will have their own insurance. If say there was a fire, your Insurers would pay to rebuild you home and if either of next doors homes were damaged their own Insurers would pay to rebuild their homes. IF you were found legally liable for the fire then there is a section of the policy that will cover Liability of probably £2m, this would pay out for their homes. For your neighboors to be able to claim off you (The liability section would cover it) they would have to prove you were legally liable. To prove this they would have to prove it that the fire was REASONABLY avoidable. A simple electrical fire which is a common reason would not normally be classed as reasonably avoidable unless you were aware the wiring was very dangerous and made no effort to have it fixed etc etc.
The surveyor the mortgage company paid for will have calculated the cost of rebuilding the house and will have over estimated the actual costs by upwards of 10% to give a margin of error to cover his own back. The costs they worked out would take into account the extra costs of rebuilding a terrace house for instance shoring the next door properties.
As you can see from the above the woman was talking absolute tosh, if you lived next door to the millenium stadium, would she tell you that you need a rebuild sum insured of £400m in case the millenium stadium was damaged?
When she rings back tommorow, please advise her that you are aware she does not know what she is talking about and that if she persists to hassle you then you will report her to her superviser and the Financial Services Authority. (In an ideal world you should report her as she is either deliberately miss leading people or more likely does not know what she is talking about and needs retraining to protect other people.0 -
Yeah.
What they said. ^^^0
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