Mortgage company want me to make a claim before they even investigate subsidence

alhenderson

Morning All,

In the last few months we have had a lot of cracks appear in the plaster on our internal walls. They are not very wide (couple of mm at most) but some of them are quite long and they have all appeared in the last few months.

I was a little concerned so I phoned the insurance company (Aviva) and they told me that in order for them to send someone out to investigate they would have to start a claim. They also told me that this claim would still be registered on my account and would affect my premium regardless of the outcome! I was quite taken aback by this - if they send someone out to have a look and they don't find anything wrong, there will still be a subsidence claim on my policy. Surely that can't be right?

To avoid that, I got a structural engineer out myself (not cheap!) and he thinks it might be minor subsidence caused by the dry summer. he advised I inform the insurance company and let them go through the motions so they have at least been advised. He thinks they will say there's nothing wrong because the evidence isn't compelling enough to 100% point to subsidence.

So, I'm going to be facing this claim thing again when I get in touch with the insurers. The woman on the phone last week told me this was standard practise, which I don't believe. Surely if they don't pay anything out because there's nothing wrong, they can't record it as a claim against me? Does anyone know if this is true or not?

Thanks,
Al.

kingstreet

They are telling you the truth.

If your application for insurance says "you must disclose all material facts, including incidents for which you chose not to claim" you must answer it honestly.

For example, you have a slight accident in your car and choose not to make a claim for the damage. At your next renewal/application you'd be expected to disclose it.

alhenderson

And I have no problem disclosing it, but surely if they then investigate and subsequently decide that its not subsidence, how should that be allowed to affect my premiums?

Al.

dunstonh

I was a little concerned so I phoned the insurance company (Aviva) and they told me that in order for them to send someone out to investigate they would have to start a claim.

That is correct. If they are going to start incurring costs then they have to start it as a claim.

They also told me that this claim would still be registered on my account and would affect my premium regardless of the outcome! I was quite taken aback by this - if they send someone out to have a look and they don't find anything wrong, there will still be a subsidence claim on my policy. Surely that can't be right?

That is right. It is also logical.

The woman on the phone last week told me this was standard practise, which I don't believe.

She is right.

Surely if they don't pay anything out because there's nothing wrong, they can't record it as a claim against me?

Yes they can. They would have incurred costs involved in an investigation.

You may well also have to declare the subsidence on future applications for home insurance which may see many more insurers refuse to offer cover or cost you a lot more. (depends on what the report says from the structural engineer).

kingstreet

Worth you reading this;-

https://forums.moneysavingexpert.com/discussion/3533067

as it was covered in a recent 'Watchdog' edition.

alhenderson

dunstonh wrote: »

That is correct. If they are going to start incurring costs then they have to start it as a claim.



That is right. It is also logical.



She is right.



Yes they can. They would have incurred costs involved in an investigation.

You may well also have to declare the subsidence on future applications for home insurance which may see many more insurers refuse to offer cover or cost you a lot more. (depends on what the report says from the structural engineer).

Sure they will have incurred costs. Maybe I'm being naive, but I would have thought that's what I've been paying premiums for all these years! Not so they can sting me for all they can the moment I even think about getting in touch with them.

Its bad enough I had to arrange for my own structural engineer to come out (and pay for it) because they do everything they can to dissuade me from using their services (which I've paid for). Now I'm going to have a subsidence claim on my insurance and the chances are they will have done nothing about it!

Clearly there's nothing I can do about this, but I still don't get how they can be allowed to penalise me for something that they have not thought worthy of any remedial work.

Guess the old adage is true, you never know how good (or bad) your insurance is until you need it - and then its too late.

Thanks for everyone's feedback, at least I know where I stand (or don't stand).

Al.
Al.

dunstonh

Sure they will have incurred costs. Maybe I'm being naive, but I would have thought that's what I've been paying premiums for all these years!

Exactly. You pay for when you need to use them.

Not so they can sting me for all they can the moment I even think about getting in touch with them.

You are either going to use their services or not. The minute you flick the switch and say I want you to look at this then they are incurring costs which you do not have to pay for explicitly whether it costs them £50 or £50,000. A claim is a claim.

If you are just thinking about it then you dont involve the insurance company. If it is normal maintenance then you dont involve the insurer.

alhenderson

dunstonh wrote: »

Exactly. You pay for when you need to use them.



You are either going to use their services or not. The minute you flick the switch and say I want you to look at this then they are incurring costs which you do not have to pay for explicitly whether it costs them £50 or £50,000. A claim is a claim.

If you are just thinking about it then you dont involve the insurance company. If it is normal maintenance then you dont involve the insurer.

But the point is I HAVE to inform them, regardless of what happens after that. And I can just see the definition of 'normal maintenance' being somewhat open to debate (not in this case, though, this is not normal maintenance).

And as for paying when I need to use them - what about the payments I have been making for all these years? The whole setup is geared towards protecting the insurance companies, which I don't suppose I should be surprised about. It just grates on me that the first time I need to use my insurance company I face financial penalties for even talking to them (which they force me to do through their terms and conditions).

Al.

dunstonh

But the point is I HAVE to inform them, regardless of what happens after that.

if it is subsidence or movement then yes.

And I can just see the definition of 'normal maintenance' being somewhat open to debate (not in this case, though, this is not normal maintenance).

Depends on what the surveyor puts in the report. If its non-movement related maintenance then you are ok and you have a report to prove it. If its movement related then you are stuffed.

And as for paying when I need to use them - what about the payments I have been making for all these years?

What about them?

The whole setup is geared towards protecting the insurance companies, which I don't suppose I should be surprised about.

Its partly to protect them but also to prevent fraud.

It just grates on me that the first time I need to use my insurance company I face financial penalties for even talking to them (which they force me to do through their terms and conditions).

subsidence is a high risk area. You are not being penalised for talking to them. You are being "penalised" for having a higher risk property. Insurance is priced on risk.

alhenderson

dunstonh wrote: »

if it is subsidence or movement then yes.



Depends on what the surveyor puts in the report. If its non-movement related maintenance then you are ok and you have a report to prove it. If its movement related then you are stuffed.

.

Nope. If they send a surveyor out then there is a claim *regardless* of the outcome - that is my problem. I paid to get an engineer out, and he says its probably subsidence, but it could be argued either way. In his view (and probably backed up by the T&Cs of my policy) I now have to tell the insurance company, who will send out a surveyor, raise a claim, have an impact on my future premiums etc.

Al.