Home Contents Insurace - Threatening no payout, help!

beeemm

Hi, I deperately need some advice.  I'll try to keep it brief

I took out home contents insurance through Tesco in a rented house, decdied about £70,000 should be enough to cover it.

Several months ago we had a house fire, the front room was torched and the rest of the house was heavily smoke damaged.

Insurance company sent out assessors and they said they were just going to write everything off, had us (and the kids) put up in a B&B furnished with bedbugs for a while but eventually we found a short term lease on a house.

We eventaully got a list back with a lot of items duplicates (Playstations for example) even though in the photos they were clearly in different rooms.  They gaven an estimate of around £55,000 for the claim.

We ammended the mistakes and added on the missing items which we could prove.  A long while went by and still no response.

We chased with the insurance company and with Tesco and we got a call back today.  They said that as the claim went over 70k with the changes (they're saying 90k now), they were going to have to send it to the underwriters and that it most likely would end up in us getting nothing at all.  We said we weren't trying to push to over 70k as that's what the cover was for and weren't expecting anything more than that.

They basically said accept the 55k or we'll send it to the underwriters and you'll get nothing at all.

Where do we stand with this?  Is this even legal?  They can't expect us to have known the value of every item in the house down to the penny before taking out insurance, surely?

This has been going on for nearly 10 months now and Christmas is looking and the kids have nothing replaced yet, barely managing to keep up with clothing

TL;DR

70k contents insurance, initial offer was 55k but had many missing items, sent it back and now they say it's up to 95k and if we don't accept 55k we'll get nothing.

diystarter7

what is the total cost for replacement like for like?

DullGreyGuy

beeemm said:

Where do we stand with this?  Is this even legal?  They can't expect us to have known the value of every item in the house down to the penny before taking out insurance, surely?

Yes, you are supposed to know the total cost of replacing every item you own and remember to factor in if its a new for old policy... not down to the penny, many insurers do steps of £10k

What as been deemed the actual total value of your contents?

Firstly, read your policy and check for anything that mentions "averaging" or more generally about underinsurance. If it does have such a clause it will say that if you are found to be under insured then your claims settlement will be reduced by the same percentage, ie if you declared your contents at £70k but it was actually £105k you only declared 66% of the value so will only get 66% of the claim

If your policy has no such term then you are falling back onto CIDRA which is the law around false disclosure... under that legislation if its deemed intentional or reckless then they can void your policy, avoid the claim and keep the premiums (plus you have to declare the voided policy for life). If its deemed accidental then it gets more complicated, if they'd have insured you with the higher value declared they can only reduce the claim by the difference in premium. If they wouldnt have insured you then they can cancel the policy.

Have to say, personally I am greatly in favour of blanket policies with very high limits, or even unlimited, coverages rather than trying to work out if your TV is worth more or less than last year etc.

beeemm

I didn't handle taking out the insurance so I'll check the docs - frustrating as I just had the impression it was claim up to the insurance limit, any more and tough, you don't get it.

" ie if you declared your contents at £70k but it was actually £105k you only declared 66% of the value so will only get 66% of the claim"

well, contents were took out to 75k, they're saying it's actually 95k (so, insurance only ~79% of total value)

Does this mean we'd only get 79% of the 75k or 79% of the total determined value?  Unsure which is applied to "claim"

beeemm

diystarter7 said:

what is the total cost for replacement like for like?

They're saying 95k and we are insured up to 75k (looks like foolishly I'd thought "up to" rather than "exactly"

DullGreyGuy

beeemm said:

I didn't handle taking out the insurance so I'll check the docs - frustrating as I just had the impression it was claim up to the insurance limit, any more and tough, you don't get it.

" ie if you declared your contents at £70k but it was actually £105k you only declared 66% of the value so will only get 66% of the claim"

well, contents were took out to 75k, they're saying it's actually 95k (so, insurance only ~79% of total value)

Does this mean we'd only get 79% of the 75k or 79% of the total determined value?  Unsure which is applied to "claim"

Unfortunately they ask what the value of your property is, not how much you would like to insure it for. Unfortunately people come unstuck because they under value their property or think there are some things they dont care about so dont include or worst of all, arguably, is they buy separate insurance for an item so dont include it in the home insurance.

From a Home insurer's perspective, if you have  grand piano in your front room and have left your £20,000 bracelet on it, that could be a damned good reason for a passing thief to target your home. Both those items may be insured elsewhere but they still need declaring on your home insurance as they still increase the risk of a loss. 

You need to read the exact terms of your policy to see how the averaging clause is to be applied, often it'll mean you'd get the 79% of the £75k and so should be £59,250 less the excess (havent checked your percentage). If there is no averaging clause then CIDRA applies instead and it comes down to a) if they think it was reckless or careless and b) what they would have charged on a £95k contents policy.

Smithcom

beeemm said:

Hi, I deperately need some advice.  I'll try to keep it brief

I took out home contents insurance through Tesco in a rented house, decdied about £70,000 should be enough to cover it.

Several months ago we had a house fire, the front room was torched and the rest of the house was heavily smoke damaged.

Insurance company sent out assessors and they said they were just going to write everything off, had us (and the kids) put up in a B&B furnished with bedbugs for a while but eventually we found a short term lease on a house.

We eventaully got a list back with a lot of items duplicates (Playstations for example) even though in the photos they were clearly in different rooms.  They gaven an estimate of around £55,000 for the claim.

We ammended the mistakes and added on the missing items which we could prove.  A long while went by and still no response.

We chased with the insurance company and with Tesco and we got a call back today.  They said that as the claim went over 70k with the changes (they're saying 90k now), they were going to have to send it to the underwriters and that it most likely would end up in us getting nothing at all.  We said we weren't trying to push to over 70k as that's what the cover was for and weren't expecting anything more than that.

They basically said accept the 55k or we'll send it to the underwriters and you'll get nothing at all.

Where do we stand with this?  Is this even legal?  They can't expect us to have known the value of every item in the house down to the penny before taking out insurance, surely?

This has been going on for nearly 10 months now and Christmas is looking and the kids have nothing replaced yet, barely managing to keep up with clothing

TL;DR

70k contents insurance, initial offer was 55k but had many missing items, sent it back and now they say it's up to 95k and if we don't accept 55k we'll get nothing.

Okay, so:

-  What was the total (i.e including undamaged) new for old value of contents that you had at the time of loss?  
-  What is the new for old value of the loss (was everything destroyed)
-  Do you believe that you are under-insured?  (i.e have insufficient total insurance cover) or have Tesco miscalculated?
-  Who is the insurer that is dealing with the claim? 

The comment 'and you'll get nothing at all' may well be inaccurate/impulsive/threatening...but it depends on various things

SC

Sea_Shell

Do (did) you have a large house full of high end branded contents to justify their figure of £95k 

Are they (you) using a John Lewis catalogue rather than say, Dunelms. (for example)

Otherwise how are they justifying that you are (potentially) under insured?

Are they extrapolating your "tastes" from a few obvious high end one off items?

eg. a High end / spec music or computer system, but you actually have cheap bedding, linen, clothes etc.

Have you only spent big on the things that are important to you.  

Other people may have luxury linen and a basic stereo. IYSWIM.


  

diystarter7

beeemm said:

diystarter7 said:

what is the total cost for replacement like for like?

They're saying 95k and we are insured up to 75k (looks like foolishly I'd thought "up to" rather than "exactly"

Thanks.
Are they going to Harrods or Argos re prices?
When we have contents insurance from memory we have to detail items costing more than 1k I tthink it was but i guess it varies with the insurance. On that basis  and remembering that the insurance is new for old, most of our tv's cost more than that the 4 seater sofas x 3 cost just under 3k each, and one mattress cost about 1200, then we have the hob, combi oven that cost over 1k each then we have jewellery a few items costing more than 1k each as its 22ct gold so these are detailed. What many forget is even if you have cloitng etc that you do not wear inc shoes or have never worn and made to measure curtains etc, etc the amount of cover rises a lot.

From what you said and if I felt I was fully insured as I believe we are, I'd let them send whoever they wanted and take it from there.

Good luck.

ps - you must have lots of high end stuff or kids with ps 5/etc and hundreds of games.

DullGreyGuy

diystarter7 said:

When we have contents insurance from memory we have to detail items costing more than 1k I tthink it was but i guess it varies with the insurance. On that basis  and remembering that the insurance is new for old, most of our tv's cost more than that the 4 seater sofas x 3 cost just under 3k each, and one mattress cost about 1200, then we have the hob, combi oven that cost over 1k each then we have jewellery a few items costing more than 1k each as its 22ct gold so these are detailed. What many forget is even if you have cloitng etc that you do not wear inc shoes or have never worn and made to measure curtains etc, etc the amount of cover rises a lot.

From what you said and if I felt I was fully insured as I believe we are, I'd let them send whoever they wanted and take it from there.

£1k would be a very low single item limit suggesting a relative budget policy.  By comparison M&S Premier sets a limit of £12,000 per item and that is only on certain item categories. 

Contents adds up surprisingly quickly for many people because they only consider their TV or their engagement ring and fail to remember they need to consider their pots & pans, socks, DVDs, white goods etc. 

As per a previous thread, most policies are new for old and therefore you buy a 4th hand Canon 70-200 2.8IS that has a couple of minor problems for a couple of hundred but you need to insure it for the new price of over £2,000. Many dont realise how much many items have inflated in cost. Even I was surprised what the high street replacement value was for the Mrs engagement ring only a few years after buying it from a specialist company that charges well under the high street

TELLIT01

beeemm said:

diystarter7 said:

what is the total cost for replacement like for like?

They're saying 95k and we are insured up to 75k (looks like foolishly I'd thought "up to" rather than "exactly"

Don't feel foolish as I suspect many people have done similar.  The thought process basically being "I think £75k would cover it, and I'd be happy with that".  The assessor then values replacement at higher than that figure so the claimant only get a reduced payout, not the £75k they thought they had taken cover for.