Home insurance queries... need some help?

Jenk_091

Hi,
My property was flooded and a lot of our items have been written off due to being beyond economical repair so they have provided an amount based on a quote I gave them which was just the amount originally payed due to still being available on websites or have sent them the closest model available that could be found and they gave given me a cash amount to be able to repurchase these items. However, we do not look to be moving back to the property and so will not buy items such as fridge, dishwasher, tumble dryer etc just yet as they may potentially be built in a new home or I dont know what size to get as of yet. But my insurance is saying I must provide them an invoice for these items? I can but it wont be yet. Is this essential as they are just replacing the items on a like for like basis but instead we have had cash for them at this moment ????? 
Thanks. 

sheramber

If it is their rules that you supply invoices to prove that you used the money to replace the items and  not buy something else, then yes, you ned to comply.
Have you discussed the position with them?

Aretnap

I'm confused. Normally an insurer will settle a claim in one of three ways. 
(1) Source replacement items themselves
(2) Send you vouchers for a preferred supplier to the value of the destroyed items or
(3) Send you cash to the value of the destroyed items

If they go with (2) or (3) then what you spend the vouchers/money on is generally up to you. If you take the opportunity to upgrade to a more expensive dishwasher and chip in some of your own money, that's fine. If you decide you can live without a dishwasher after all and spend the money on a weekend away instead, that's also fine. It's none of the insurer's business what you spend the settlement on - what difference does it make to them? You're claiming for the goods that were lost, not the goods that you replace them with.

So why are they asking for invoices for the replacement items? Are you sure they're not actually asking for receipts for the original (lost) items? 

Jenk_091

Aretnap said:

I'm confused. Normally an insurer will settle a claim in one of three ways. 
(1) Source replacement items themselves
(2) Send you vouchers for a preferred supplier to the value of the destroyed items or
(3) Send you cash to the value of the destroyed items

If they go with (2) or (3) then what you spend the vouchers/money on is generally up to you. If you take the opportunity to upgrade to a more expensive dishwasher and chip in some of your own money, that's fine. If you decide you can live without a dishwasher after all and spend the money on a weekend away instead, that's also fine. It's none of the insurer's business what you spend the settlement on - what difference does it make to them? You're claiming for the goods that were lost, not the goods that you replace them with.

So why are they asking for invoices for the replacement items? Are you sure they're not actually asking for receipts for the original (lost) items? 

- This was exactly my response. So they paid option 3 after providing quotes based on the model number of the appliances. So I had to locate the original cost which they then paid out to me but now they are saying that the policy is like an indemnity policy where you have to replace the said items. 
I just think its ridiculous. They have given us lots of cash settlements for different items but only require it for the kitchen applianpces. Seems bizarre.
I have just had an email saying that it goes against the terms of the policy to claim for something that I do not intend to replace. 
But they said if was beyond repair and asked for make and model in order to provide a cash amount. 

Aretnap

Who is the insurer? 

Jenk_091

Aretnap said:

Who is the insurer? 

Lloyds

Aretnap

Jenk_091 said:

- This was exactly my response. So they paid option 3 after providing quotes based on the model number of the appliances. So I had to locate the original cost which they then paid out to me but now they are saying that the policy is like an indemnity policy where you have to replace the said items. 
I just think its ridiculous. They have given us lots of cash settlements for different items but only require it for the kitchen applianpces. Seems bizarre.
I have just had an email saying that it goes against the terms of the policy to claim for something that I do not intend to replace.

Hmmm... well that doesn't make sense on numerous levels.

First of all, you do intend to replace them; you just haven't done it yet for what sound like pretty good reasons. So on those grounds alone you'd be justified in telling them to get stuffed. (OTOH, maybe don't actually tell them to get stuffed until they've finished processing the claim)

Secondly and more importantly, I can't find any clause in Lloyd's policy documents which says that, or anything like it. Lloyds have several versions of their policy documents online, but picking this one for example it gives a list of the type of information you have to provide to prove your loss

You must be able to prove and substantiate your loss. To assist with this we may request you to provide reasonable additional information at your own expense. Examples are:
Original purchase receipts, valuations, invoices, instruction booklets, bank statements or photographs;
Purchase dates of lost or damaged items;
For damaged items, confirmation by a suitably qualified expert that the item you are claiming for is beyond repair

Note that all these things relate to the items that were lost; there is nothing about providing information about the replacements.

Then in explaining how they settle claims they say

How we settle claims under your Contents covers:
We can either repair or replace any item or make a money payment instead.

Note: a "money payment", not "a money payment which you must promise to go out and spend immediately on an exact replacement"

I would ask what specific term in the policy they think requires you to buy an exact replacement as I can't see one, and it sounds like whoever sent you the Email is making it up as he goes along.

And finally, such a term would make no sense whatsoever. There's nothing in any insurance policy which restricts you to claiming for items that you actually like. It's no skin off your insurer's nose what you spend your settlement on - the cost to them is the same either way. And if they really are that desperate to make sure you get a new dishwasher, the policy terms give them the right to send you a replacement item rather than a cheque, so why not they just do that instead? And even if they did, there would be nothing to stop you from selling the replacement on eBay the next day. They can't force you to use a dishwasher for the rest of your life to prove how desperately you needed your old one replacing.

I suppose one reason why they might ask for details of your replacements is as some sort of fraud prevention measure. If you claimed for numerous kitchen equipment and then didn't replace any of them they might suspect that the old ones weren't as badly damaged as you claimed and that you're still using them. So the fact that you didn't replace them wouldn't in itself invalidate your claim (and in your case there's a clear reason for the delay anyway), but it might give them reason to investigate the claim more thoroughly. I wonder if the person you're in touch with is new and has got the wrong end of the stick about why he's asking for them.

Are they actually threatening to do anything if you don't provide the receipts, or is this just an annoyance?

Jenk_091

Aretnap said:

Jenk_091 said:

- This was exactly my response. So they paid option 3 after providing quotes based on the model number of the appliances. So I had to locate the original cost which they then paid out to me but now they are saying that the policy is like an indemnity policy where you have to replace the said items. 
I just think its ridiculous. They have given us lots of cash settlements for different items but only require it for the kitchen applianpces. Seems bizarre.
I have just had an email saying that it goes against the terms of the policy to claim for something that I do not intend to replace.

Hmmm... well that doesn't make sense on numerous levels.

First of all, you do intend to replace them; you just haven't done it yet for what sound like pretty good reasons. So on those grounds alone you'd be justified in telling them to get stuffed. (OTOH, maybe don't actually tell them to get stuffed until they've finished processing the claim)

Secondly and more importantly, I can't find any clause in Lloyd's policy documents which says that, or anything like it. Lloyds have several versions of their policy documents online, but picking this one for example it gives a list of the type of information you have to provide to prove your loss

You must be able to prove and substantiate your loss. To assist with this we may request you to provide reasonable additional information at your own expense. Examples are:
Original purchase receipts, valuations, invoices, instruction booklets, bank statements or photographs;
Purchase dates of lost or damaged items;
For damaged items, confirmation by a suitably qualified expert that the item you are claiming for is beyond repair

Note that all these things relate to the items that were lost; there is nothing about providing information about the replacements.

Then in explaining how they settle claims they say

How we settle claims under your Contents covers:
We can either repair or replace any item or make a money payment instead.

Note: a "money payment", not "a money payment which you must promise to go out and spend immediately on an exact replacement"

I would ask what specific term in the policy they think requires you to buy an exact replacement as I can't see one, and it sounds like whoever sent you the Email is making it up as he goes along.

And finally, such a term would make no sense whatsoever. There's nothing in any insurance policy which restricts you to claiming for items that you actually like. It's no skin off your insurer's nose what you spend your settlement on - the cost to them is the same either way. And if they really are that desperate to make sure you get a new dishwasher, the policy terms give them the right to send you a replacement item rather than a cheque, so why not they just do that instead? And even if they did, there would be nothing to stop you from selling the replacement on eBay the next day. They can't force you to use a dishwasher for the rest of your life to prove how desperately you needed your old one replacing.

I suppose one reason why they might ask for details of your replacements is as some sort of fraud prevention measure. If you claimed for numerous kitchen equipment and then didn't replace any of them they might suspect that the old ones weren't as badly damaged as you claimed and that you're still using them. So the fact that you didn't replace them wouldn't in itself invalidate your claim (and in your case there's a clear reason for the delay anyway), but it might give them reason to investigate the claim more thoroughly. I wonder if the person you're in touch with is new and has got the wrong end of the stick about why he's asking for them.

Are they actually threatening to do anything if you don't provide the receipts, or is this just an annoyance?

Thanks so much for your response! 
They are just saying that I have to provide an invoice at some point as it may hold up the claim. And they have logged all the correspondence between ourselves and will contact customers care team to deal with the issue. 

I completely understand that with fraud prevention but they have all the old appliances. They took them off to assess them and said they are beyond economical repair so have written them off.