Is there a time limit on making a claim for damages caused by a 3rd party?

leafy211

My neighbour told me a couple of days ago, that the house next door has caused damage to his ground floor hallway wall (daylight can be seen), which he reported to the managing agents and directors a year ago (last February).   Its totally crazy to  me that he has let it sit for so long ..  but i wondered if there is a time limit on getting one's insurance involved, and if so, what is that limit.  (One of my fears for him - besides any danger the damaged wall might bring - would be that the 3rd party may change their insurers who may refuse to deal with an old matter etc ..).
Many thanks in advance for any guidance.

Aretnap

The time limit for bringing a legal claim against a third party is six years from when the damage occurred. It doesn't matter whether the neighbour has changed insurance companies in the meantime, as liability claims would be generally be dealt with by the insurer at the time of the incident, even if the policy has since expired.

Whether the neighbour (and therefore, his insurers) are actually liable will depend on the nature of the damage and how it was caused. You haven't said very much about that, but the neighbour is not automatically liable for damage to someone else's property just because his own property was somehow involved.

If your neighbour wants to make a claim against his own insurance policy the policy terms will dictate how soon he has to make the claim. Generally the terms will require him to report damage and claims promptly. In practice there's usually some tolerance for delays, but if he's sat there watching the problem get worse for months without involving his insurers, they might not be too impressed at not being given the opportunity to sort it out when it might have been easier and cheaper to fix. 

Sandtree

You mention managing agents and directors though? That implies its a leasehold building which naturally can change who is the party that has actually suffered the loss and whos insurance responds.

Is the alleged offending neighbour within the same block/building?

Both home contents and home buildings contains third party liability cover, the former covers you as the occupant of the building whereas the later covers you as the owner of the building. If this is a leasehold then its likely they only have contents insurance so if it would respond depends on whats happened.

Unsurprisingly, I agree with Aretnap on the limitations etc.

leafy211

The people that caused the damage (or their contractor, when removing the pond - assuming a digger crashed into the building, or something similar), are in a freehold property .. nothing to do with the leasehold properties. 
Comforting to know the time allowed to forward a claim is so generous. 
Apparently the managing agents, on behalf of the directors, forwarded the photos of the damage (from the freeholders property, which was significant apparently) to the insurers.  And the feedback was that the insurance company dont believe it is structural and have suggested that the owner gets a structural engineer to do a report.  
Ive personally never come across an insurance company that would not only make that decision from a non-expert set of photos, but also ask the insured to get a structural engineer to do an assessment.   All buildings insurances, that ive dealt with, would sent their own person out to assess.
But maybe that is how things are done these days?

Sandtree

This is the insurers of the freeholders then? Are either the freeholders or the agents a large operation? Block insurance is a type of commercial insurance which can be different to personal lines. Larger organisations can take on certain aspects of claims handling in exchange for lower premiums...with the issue of vat v ipt it’s not hard for it to become cost effective 

leafy211

this is the insurers of a block of 26 flats. Im not sure that would be classed as a large operation?  Would they act so very differently for building insurance, if the bricks of a property had been compromised to the point that daylight could be seen through the bricks?   Im not sure what you mean by VAT vs IPT and what that meaning represents for buildings insurance of a leasehold flat.. 

leafy211

But shouldnt it simply be a matter of the block insurance company dealing with the insurance company of the people who did the damage no? 

Sandtree

leafy211 said:

Im not sure that would be classed as a large operation?  Would they act so very differently for building insurance, if the bricks of a property had been compromised to the point that daylight could be seen through the bricks?   Im not sure what you mean by VAT vs IPT and what that meaning represents for buildings insurance of a leasehold flat.. 

It is more if the freeholder owns just this building or 100 similar likewise if the managing agent manages just this building or 1,000 similar.

IPT -v- VAT is the fact that if you pay an insurance company to handle your claims and you are a VAT registered company you have to pay them cost + profit margin + Insurance Premium Tax (12%) which you obviously offset against your profits but that means you still "lose" 80% of the IPT. If you pay a claims company to do the handling rather than your insurers you pay cost + profit margin + VAT (20%) but you can recover 100% of the VAT and the rest is offset against profits. Alternatively you can do it yourself and avoid the profit margin and tax totally. So if you are a big enough entity to have fairly predictable claims volumes it can be cheaper to pay your insurers less and have others deal with the claims.

In this scenario the insurers cease to actively manage claims but instead have an oversight/validation role - in some cases it can be small-medium claims the insured deals with but large claims the insurer continues to deal with. 

So the difference taxation regime depending on approach is one of the reasons why larger organisations dont pay their insurers to deal with their claims for them. 

As to is light through the wall sufficiently big to warrant the insurers being active? By way of comparison, one policy I dealt with only required the insurer to be informed of any claims when either a single claim was over £20m or when the total for the policy year exceed £250m the single claim value reporting threashold dropped to £75,000... there are some seriously large policies out there when you start dealing with multinational corporations!

leafy211

Hey Sandtree - thanks so much for explaining that to me.  Ive learnt a lot, which is wonderful. In this case, the freeholder, which is an Rtm company, has just the one block and it is a dormant company, so no VAT (all bills go via the managing agents).  Im not sure about the current status of the managing agency as they are about to hand us over to another company (dont ask! :-)), but they certainly were VAT  registered and would have been managing a few properties.. so would they, or the freehold company be classed as the owners of the insurance (for VAT reasons etc) in this scenario?  The insurers did deal with a claim i had a couple of years ago when a crumbling stone window ledge dropped onto my car - which was a £300 claim...