Should I start a subsidence claim ?

ShowmetheSavings

Hi All,
I am worried and confused about what to do in regard to minor subsidence on our house and the best way to proceed wrt to the insurance company.
Over the recent hot weather our house developed a number of quite large cracks on internal walls, and doors that once worked have started to stick.
We moved in 7 years ago and extended and modified. The last work was an extension to the back about 3.5 years ago.  As the worst cracks are where the house and extension meet I asked the builder of the extension for advice and he recommended a structural engineer come and inspect it.  The engineer said we had minor subsidence and recommended monitoring it over the next 6 month to a year.  He suggested large trees in neighbours gardens, clay soil and extremely dry, hot weather were possible and likely causes. Both he and the builder didn't think it was worth contacting the insurance just yet and believe they would probably do what ever they can to tell us its not subsidence and would suggest we get the neighbour to cut her oak tree whilst increasing our premiums.
Looking online and we find that telling the insurance company can cause all manner of problems as once a house has been labelled as a subsidence risk it can mean not only bigger premiums with specialist insurers but also difficultly in selling/lower resale value.

So I order some tell-tales, the devices to measure and monitor to cracks with the intention of following the engineers advice but while waiting for these to arrive the cracks are visibly worse and the back door frame is sufficiently distorted that it no longer locks.  I have been adjusting then hight of the door over the summer to compensate for this but there is no more adjustment available in the hinges.

Should I get the insurance company involved yet or not ?  I am concerned that if we don't tell them straight away it might invalidate any claim.
Their website says:
If you think your house is subsiding, contact your insurer as soon as possible. They’ll arrange for a full survey to confirm whether or not it’s a genuine case of subsidence. With buildings insurance from AXA, you're covered against subsidence and ground heave, although there are number of exclusions – for example, if the subsidence is a result of construction or demolition, or due to defective materials or faulty workmanship. 
Policy document states it does not cover :
Any loss or damage arising from structural problems as a result of any form of subsidence, bedding down of new structures, demolition, alterations to your home or the use of defective products.
Loss or damage: due to settlement, shrinkage or expansion.
I am concerned they might decide its the bedding in of the extension (4 years old at Christmas) or shrinkage of the clay soil below so not their problem and we get a house noted for subsidence, and what ever problems that brings .... and have to pay for repairs ourselves.
I have also noted they they describe subsidence as necessarily involving the outer bricks, the cracks we have are all internal.

I should also point out that before speaking to the engineer I spoke to insurance customer service asking what to do. They told me to ring the claims line but as I didn't really know what was going on making a claim seemed too much when I only wanted advice. Are they likely to have noted this conversation even though I didn't go on to make a claim ?


Anyhow .. sorry for the long post, hope someone can give me some pointers.

Many thanks 

TELLIT01

If the policy states you should inform them as soon as possible if you think you have subsidence, and you fail to do that, they may refuse to pay out.  I don't think you have any option but to inform them and take it from there.  If you inform them your premiums may increase but if you don't they may not pay out if/when they discover the full facts.  Increased premiums or cost of repairing subsidence - which will be cheaper in the long term?

ShowmetheSavings

TELLIT01 said:

If the policy states ....... which will be cheaper in the long term?

thanks for the reply. one of my concerns is they they find a reason not to pay or insist its not subsidence but we end up with higher premiums and a house thats difficult to insure (sell?) regardless.
their website says:

If a crack is caused by subsidence, it will be:

• Thicker than a 10p coin (more than 3mm)
• Diagonal, and wider at the top than the bottom
• Visible internally and externally
• Found close to doors and windows

we dont have any external cracks but an engineer tells us its minor subsidence.  So they say not our problem but end up labelled as subsidence risk ?

ShowmetheSavings

https://www.independent.co.uk/property/house-and-home/you-think-youre-on-safe-ground-but-then-subsidence-strikes-899547.html

an article in the independant that covers some of the issues should anyone else be interested

huckster

Structural engineer has told you it is minor subsidence, so you have no choice but advise the Insurers.  
If you don't tell your Insurers, then you risk them declining a claim  later, if the subsidence worsens. 
Reason for declining a future subsidence claim is that you prevented them from investigating at this stage, measures which could have dealt with the current level of subsidence and therefore reduced the level of any potential claim.  

ShowmetheSavings

thanks for your input. That is very much part of the dilemma. 

Thrugelmir

Better to incur an increased premium than suffer a large financial loss. 

ShowmetheSavings

its not so much about a premium but more about not being able to sell or remortgage a house with a history of subsidence.  
Do you have any experience of this situation ? 

paddyandstumpy

If an engineer has already told you the property is suffering from subsidence; regardless of severity; your property is now tarred with the subsidence 'brush'. 

Any surveyor if you sell the property will find the same. 

The point raised previously is a good one, if you don't inform insurers now, and allow them to take steps to mitigate their liability, they may refuse to indemnify you at a future stage. 

If they can take remedial action now, for arguments sake at a cost of £10k, if the subs worsens and then you claim and it's costs them £30k to repair, they would be a bit cheesed off and may refuse to cover you. 

Zorillo

You do not have a dilemma; you must tell your insurance company.

They cannot simply decide it is not subsidence if a structural engineer has already determined it is. In any case, if they can prove that it is not subsidence, then you should not have to declare the history or suffer increased premiums or terms. It cannot be subsidence and not subsidence at the same time!

You could wait, fill the cracks and it never reappear in which case you'd be lucky.  If you were unlucky, it could get a lot worse very suddenly and the insurer would take a dim view if they found out you already knew it was suffering from subsidence.

Tell your insurer.

MIC_78

You should absolutely tell your insurers and raise a claim. Firstly you risk invalidating a future claim by not doing so, and secondly this is exactly the sort of thing you have insurance for - the costs of correcting subsidence can be huge, and it would surely be far worse to end up footing the bill for potentially thousands of pounds from your own pocket if the problem worsens further. Also consider any mortgage implications - if your property is mortgaged and you fail to maintain the property in a good state of repair this could cause issues with the mortgage lender also.

Regarding being considered a subsidence risk and incurring larger premiums in future, unfortunately you don't really have a choice in this regard either way - if you were to purchase a new policy elsewhere you will likely be asked if your house is currently suffering from (or has suffered from) subsidence, and the answer is clearly yes. So either way your property will be considered a subsidence risk and any premiums would reflect this accordingly.

Finally one note of caution I would raise in regard to your extension, is if the insurers investigate and find the builder failed to adequately account for the potential causes of subsidence when constructing the extension (the stated oak tree and clay soil, which would need foundations of a certain type and depth) then your claim could be declined due to defective design. In this instance any remedial works should be conducted by (or certainly paid for) by your builder.