Insurance claim declined

BC27

Hi. My mother is age 67 and lives with my brother who is a GP. Last year they were having renovation works carried out to an upstairs bedroom and a safe which was located in a wardrobe was disturbed and some of my mothers jewellrey went missing. There were several tradesman on site during this time and despite reporting the loss to the Police my mothers jewellrey was not found. A contents claim was made to Halifax for the loss and after several months they have responded and advised they are not paying the claim. The reason for this is during an interview (one of several that took place) my mother told the Halifax's representative that my brother (the GP) somtimes sees private patients in his office at home. The office is located near the front door and when patients visit the house he is with them all of the time. The stolen jewellrey was located in a bedroom upstairs well away from his office and the theft was totally unconnected to the fact he sometimes has patients visiting. Can Halifax get out of paying a claim on such a technicality? The insurance policy has been in force since 2009 (over 3 years) and they were unaware that this would ever be an issue. Any feed back would be appreciated.

Slowhand

Could it be that it was declined as a 'business' is being conducted on/from the premises? Perhaps 'business' insurance was required?

FlameCloud

Have they cancelled the policy?

Buzby

It is a different level of cover, as the perceived risk is greater. Not many people let the public into their houses, which is why the premium is less.

You will need to be guided by your policy document. Pay particular attention to any exclusions that stipulate that occasional business use (seeing patients) is not covered. If not, you may be able to argue the case for a settlement.

The devil (as always) is in the detail!

BC27

The plan has not been cancelled by the insurer (to my knowledge) but they were only informed yesterday of the decision. I assume the policy will say "no business use" but I guess it depends how this is interpreted. Many people have an office at home in this day and age and may deal with clients/patients etc now and again. Will be taking this to the FOS.

BC27

Slowhand wrote: »

Could it be that it was declined as a 'business' is being conducted on/from the premises? Perhaps 'business' insurance was required?

But if there is no link between seeing the odd patient and the actual theft claim then can the insurer wriggle out of this? If my brother held business insurance for seeing patients in his home then this insurance policy would not have covered them for this anyway.

dunstonh

my mother told the Halifax's representative that my brother (the GP) somtimes sees private patients in his office at home.

Running of commercial activities in a home will make many residential policies either add exclusions or restrict the activities allowed to maintain cover. Clerical work at home rarely causes any issues. However, business guests to the home is frequently a no no on residential home insurance.

Can Halifax get out of paying a claim on such a technicality?

Probably. The problem is not that it is a technicality. It is an area of non-disclosure. Accidental non-disclosure would normally see the provider required to pay out with any adjustment to the claim made to reflect the additional premium cost it would have been. Intentional non-disclosure can see them reject the claim outright.

Where it is classed as accidental non-disclosure but where they would never have offered cover in the first place, they should refund premiums and reject the claim.

I assume the policy will say "no business use" but I guess it depends how this is interpreted. Many people have an office at home in this day and age and may deal with clients/patients etc now and again. Will be taking this to the FOS.

Business use is not open to interpretation. Most policies are quite clear on what they will or will not cover. Office at home is not problem with most as mentioned. People visiting the home is the usual issue. The FOS have a guide on non-disclosure.

http://www.financial-ombudsman.org.uk/publications/ombudsman-news/46/46_non_disclosure_insurance.htm

I would refer you to the last section on inadvertent non-disclosure. That is the position I would expect you to fall under based on the limited information we have so far. If Halifax put you in that position then you know that is what the FOS outcome would be if you referred the complaint to them. Note you cannot go to the FOS directly. You need to complain to Halifax first. However, knowing the FOS position will help you decide if Halifax have dealt with the claim incorrectly.

*Scarlett

You are quite right that many people do some work from home. Many mainstream insurers will cover this providing it is purely clerical work - no stock, contracters, visitors relating to the business, limited amount of cash / cheques, etc.

Some policies will allow visitors / customers to the home on a limited basis - maybe up to 3 per wk on some policies(?)

The problem is that you don't seem to have told Halifax that the home is sometimes used for business use. They could then have told you if they could cover and any endorsements.

When you took the policy out there would have been "assumption" questions including working from home. Do you have any of this original paperwork or any renewal docs that may give you this info?

As regards to the renovation works - may I assume that you are thinking that it was possibly one of the workmen who stole the jewellery? If so, you should check your policy book / conditions. Many policies require you to inform the insurer if there are renovations, alterations, etc going on. They may apply conditions to the policy while the work is ongoing (depending on what you are doing) eg theft would be covered for forced or violent entry only.

There is no harm pursuing a complaint to Halifax if you feel that the claim has been unfairly declined but make sure you have all the relevant details as to what your policy covers.