After subsidence, insurer no longer offers subsidence cover - WHAT TO DO?

Gerbert

Three years ago subsidence was diagnosed at the back of my house, probably ultimately due to a collapsed drain which had left substantial voids under the ground. The insurer appointed a loss adjuster, and grout injection was carried out in February 2018. Subsequent monitoring has indicated seasonal variation is still occuring and the role of trees in neighbouring gardens is now being assessed as a secondary cause.

Meanwhile my insurance is up for renewal (for the third time since my claim went in). For the last two years I have been insured with AmTrust Europe, with cover inclusive of any new incidence of subsidence. But my broker for some reason is no longer doing business with them, and the new insurer they have found is refusing to cover subsidence at all. This despite the fact that the broker (Risk Alliance/Business Direct/Flood Insurance Direct) is meant to be a specialist in this area.

Obviously I do not want to be left without cover for one of the most expensive things that can go wrong with a house, but I do not know where to turn.

I would be grateful for any advice anyone can offer.

sal_III

Can't you go to AmTrust Europe directly or at least ask/check their website for other brokers that still use them?

Gerbert

On the basis of my enquiries today, the trouble appears to be that AmTrust Europe are no longer insuring buildings at all.

Zorillo

2018 was a bad subsidence year, and so appetite and capacity to write subsidence cover is lower this year than in recent years.

Your broker needs to work harder, or you need to find a new one that can help. But if you're in an area where problems are expected, and you've had recent significant and ongoing problems, you may need to accept the fact your building is an unacceptable exposure.

PrivateClients

If I've read your post correctly and you are saying that the property is currently suffering from active movement, then nobody will take the risk on with subsidence cover, no matter how hard the broker works - if movement is ongoing and the ultimate cause has not yet been established.

Even if a new policy did, it would be questionable whether a new subsidence event had occurred or whether it was actually the same claim that pre-dates the inception of your new policy. That's likely what a new insurer would assert.

There's no element of risk that it won't happen and there needs to be uncertainty to insure against. If its ongoing, it's a fact that has already occured and is still occuring and thus uninsurable.

Once AmTrust have resolved the current claim then you would probably need a structural engineers report to confirm that there is no movement and that things like pruning nearby trees and fixing the drain have resolved the ultimate causes. Then I'd expect a specialist insurer would grant cover but maybe with a higher subs excess like £2.5k to £10k.

Otherwise there's a few insurers out there who will disregard subs claims after 10 years but obviously that doesn't help right now.

Gerbert

Thanks for the responses. The primary cause is said to be the collapsed drain, and this - I am told - was addressed by the grout injection 18 months ago, but the fact that there is still movement suggests a subsidiary role for the trees at the back, and some of these have not yet been touched, as they are in neighbouring gardens. So I suppose that it is the case that "the ultimate cause has not yet been established".

The insurer who is bearing the costs (minus a £2.5K excess) of the current subsidence event is not AmTrust Europe btw, but a previous insurer named Ageas. Perhaps I was particularly fortunate to get cover from AmTrust which included subsidence for the last two years, and this misled me into thinking this was normal and would continue. But everyone I speak to tells me that they cannot insure me while the current claim is unresolved, and I should therefore "stick with the current insurance provider". But that is impossible, as explained previously.

Zorillo

Why did you leave your current insurer with an open subsidence claim? They may have had an obligation to offer a renewal including subsidence, but if you voluntarily moved away I am not certain but I think that obligation would have ceased.

Gerbert

I queried this at the time but was told there was only a non-binding industry convention, not any kind of obligation. It was my broker who switched me from Ageas to AmTrust; they said this was standard practice when looking for the cheapest cover (see below). Maybe I should have tried to insist that I wanted to stick with Ageas, but it wasn't suggested to me that this was even possible.

Here is the relevant paragraph of a letter I received just over two years ago from the broker after querying the switch in insurers:

"In order to ensure that we continue to offer the best premium, for the cover required, to our clients we are constantly reviewing our panel of insurers, this year, Ageas have been removed from our panel and we are no longer able to offer terms with this insurer, however, the underwriters remain unchanged and the same product has been offered with an alternative insurer, AmTrust." (breathless punctuation as per original)

The next paragraph may also be relevant:

"Please be assured that Ageas will continue to manage your ongoing claim and in the event of a new occurrence of subsidence, the necessary investigations would be carried out, if it was established that this was associate with the previous incident the Insurer in place at that time would become responsible, however, in the event that this was a completely new incident the new Insurer would handle this matter in accordance with the terms of the policy in place at the time of the incident."

Zorillo

I thought that might be what had happened. Your broker seems to have let you down, in my opinion. It would have been sensible to have found a new broker to continue with the existing insurer rather than have your existing broker switch you for their own convenience.

I'm conscious that me saying that now doesn't help you.

Speak to a decent insurance broker, not one offering cheapest cover, and see what they can advise.

Gerbert

It looks like you are right. I have now tried a number of specialist or 'non-standard'/'high-risk' insurers (Higos, Adrian Flux, WiserConnect, TowerGate), all of whom begin by assuring me that they can offer me subsidence cover ("no problem at all"), but once I explain the situation tell me that regrettably due to the outstanding claim they cannot proceed. They then typically advise me to try one of the others I have already tried.

I even called Ageas again to see if they could do anything for me but after raising my hopes by telling me that a partner company of theirs called Rias Insurance could do it, Rias themselves told me otherwise.

Thanks anyway.

EdGasketTheSecond

I've not been able to get cover for subsidence since a claim back in 2007 where the problem was dealt with to 'Building Regs Standard' however no other insurer will insure me (even for contents!) and my original insurer wants a stupidly high premium for continued subsidence cover. So much for having faith in their own appointed builders. I have had to get on with life and bear the risk of any further subsidence myself.


It sounds though that your 'ongoing' issue should be dealt with by the insurer that you have been insured with when the issue was first discovered. You can't expect a new insurer to sign up immediately for what could be an expensive claim can you?