Profitting From A Buildings Repair Insurance Claim

acbleeds

dacouch wrote: »

I doubt the policyholder has received a "cash" settlement not depending on who he uses, if he had then he would not need / be willing to bung you such a large drink

Thanks again 2sides2everystory and thanks Dacouch (my apologies, I thought I had already said thanks to you but I hadn't so thanks again ). I am very greatful for everyones comments but especially from those who have specific knowledge in this area. Dacouch, with your experience in this area, does your quotation above mean what I think, that his cash settlement is dependant upon me doing the work? (and I therefore assume based on this that his claim/payment would be invalid if they discovered I had not done it?)

Also, would I be at fault if I took his payment but with the my strict refusal to produce any paperwork or say anything false to the insurance if they ever ask me, relating to the work which I will not have carried out, with it therefore being a (very large) payment for my time spent on the assessment of the project on his behalf?

vaio

I'm sure Dacouch will be along soon to give the insider answer but I'd be surprised if the insurance would give a cash payout and tie it to forcing the policy holder to using you.

If they did that you would be the agent of the insurance company and they would be responsible for the standard of the works and the additional costs should any unforeseen works be discovered etc etc, all of which defeats the whole point of a cash settlement in the first place

dacouch

If it was a cash settlement eg the Insurer pays an agreed amount an walks away, the policyholder would not be so keen on offering the OP a £10k drink for providing a moody (Dodgy) invoice.

My take on this is that the p/h has obtained the 25% upfront payment for materials, decided to use a cheaper contractor / cheaper materials and has later discovered that the Insurance company want an invoice from the OP before they release the balance of the funds or further interim payments. This would throw a major spanner into the works for the p/h hence the offer of a large drink. This would also explain why the OP heard nothing about the building work until the other builders were well into the job.

The p/h has probably been paying the contractors cash in hand for which they both thought they were onto a winner until the request for an invoice from the OP was brought up

acbleeds

Update:

The policyholder has phoned me this evening, saying he has spoken with the insurance and is expecting them to pay up fully sometime next week. The only outstanding issue for them is that they are still awaiting a quote for the electrics part of the job, something I was planning to get assessed by an electrician and then a subsequent quote for replacing damages, sockets, wiring, consumer unit etc. as you have probably already guessed, he is asking me to give him a quote for this in the morning, but the work has already been completed. He says I should just put in the price for what it actually cost (approx £4.5k + VAT and he's emailed me a photo of the invoice from the merchant where he purchased the equipment and said it took an electrician about 3 weeks to finish) so then he can sort out full payment of his balance. Therefore it is not looking like further invoices are required from me for him to receive further money, he will have it all upfront next week if I provide this last quotation.

I kept expressing my concerns over what's happening and he keeps assuring me he's not asking me to do anything illegal or compromise myself in any way, but I am still struggling with whether this is the case. He says why would he compromise himself over what (to him) is such a small amount of money? Which I do tend to agree with, it seems very odd that he would do this for a minor amount to him (and this area of the property was all decorated brand new only 12 months ago)

Am I compromising myself if I give this quotation knowing the work has already been done or can it be argued that it is completely legitimate to do this because this is what it actually cost (so not exaggerating etc and it was required and insurance know this), and the insurance company were draggin their feet considerably and they have admitted this?

My understanding now seems to be, that if he is given full settlement upfront as he is expecting, then he's free to do with the money as he pleases, be it go on holiday, buy a new car etc if he so chose? So if that's the case, then I can legally accept the payment? And I assume if the insurance company do that, they can't then retrospectively ask for an invoice at the end having washed their hands of the responsibility of the quality of finish etc previously?

Thanks again, you guys are great! (I'm still confused, but am slowly figuring it all out, it seems to be a very 'grey' area)

acbleeds

Or should I tell him to say my electrician is away so can't give a quote, so he should seek one from an alternative source?

zzzLazyDaisy

Personally I don't see how you can, in all honesty, give a quote for work that doesn't need doing.

To be honest I don't really understand why he didn't just get the quote for the work before it was carried out. I also don't understand why you are wasting your time writing quotes for work that doesn't need doing when you could be out quoting for work that does in fact need doing - unless he is going to give you a back-hander for work that you haven't done.

You run a business, you must have access to professional advice - your accountant maybe?

vaio

dacouch wrote: »

If it was a cash settlement eg the Insurer pays an agreed amount an walks away, the policyholder would not be so keen on offering the OP a £10k drink for providing a moody (Dodgy) invoice.

My take on this is that the p/h has obtained the 25% upfront payment for materials, decided to use a cheaper contractor / cheaper materials and has later discovered that the Insurance company want an invoice from the OP before they release the balance of the funds or further interim payments. This would throw a major spanner into the works for the p/h hence the offer of a large drink. This would also explain why the OP heard nothing about the building work until the other builders were well into the job.

The p/h has probably been paying the contractors cash in hand for which they both thought they were onto a winner until the request for an invoice from the OP was brought up

I'm maybe more trusting (less cynical?) than you but I can't see why the insurance company would make the OP their agent (with all the responsibility that entails) and then not contract directly with him to do the works.

Is it normal in the insurance world to make payments in advance rather than just on stage payments & completion?

If I was the insurance company I'd either avoid the responsibility (via a cash settlement) or specify the builder and take full control over the costs. The way this one seems to be panning out the insurance company have the worst of both worlds, no control & all the responsibility. Seems strange to me, my money is on a no strings cash payout

vaio

OP, presumably you have enough information from earlier to provide quote for the electrical work? If so I'd give him the quote and collect your money when you deliver it

acbleeds

Vaio, yes I effectively have enough information to provide such a quote (although having looked at what he's told me, I think he's inflated the amount of time it has taken the electrician quite heavily). But I still see it as wrong to provide a quote for work already done? Yes, it is legitimately part of the work that needed doing, but not sure why he doesn't just tell them he's already completed that bit? To be honest, as much as I'd love the money and could really do with it, I just know there must be a reason he's offering so much, so think I am going to have to just wash my hands of the whole thing. Far too much stress all this

acbleeds

Oh and meant to ask... What does 'OP' stand for (apologies for my naivety, I know it refers to me the contractor, but don't know it's meaning )