Home Insurance - cancelled policy / number of bedrooms

InsuranceQuery26

Hello

Does anyone have any insight, or know an expert I can talk to about about this situation:

• We have just lodged a home insurance claim to repair bathroom after a burst pipe.
• Insurers are reviewing the claim but have cancelled the policy (in 21 days) as they say we have given incorrect info on number of bedrooms.
• We have 2 x upstairs bedrooms.
• When we bought the house it was being marketed as 2 - 4 bedrooms.
• The previous elderly owners were using the original downstairs lounge as their bedroom due to mobility issues.
• They had put a bed in the ground floor extension reception room as a spare room for visiting adult children.
• The house was originally built with 2 bedrooms upstairs, upstairs bathroom, a downstairs lounge, kitchen and shower room.
• A ground floor extension was added at a later date with a lounge, dining room and snug.
• We always class it as a 2 bed property.

My concern is whether we can get insured elsewhere now or if this simple mistake has made the property uninsurable in the future?

Can I push back to the current insurers and disagree with their assessment of the house? I have lodged a complaint but it is taking them ages to reply.

Am getting really worried and don't know where to turn for correct advice.

Thanks

ButterCheese

I would certainly push back. Do you have any plans of the house, i.e. was it advertised for sale on any websites recently? Perhaps the wording could be used in your favour, if they marketed it as 2-4? A quick look online suggests there is no legal definition of a bedroom, as long as you would or could fit a single bed in there, it can be classed as a bedroom for marketing purposes.

SO it mught come down to your use of the property, so I would send pictures of the other rooms (that you are not using as bedrooms) to try in some way to prove that you only have 2 bedrooms

MyRealNameToo

Was it a policy only rated on the number of bedrooms or were you also asked about how many reception rooms you had etc?

You have nothing to lose in complaining, the issue will be for you not the property. At this point in time you will have to declare a policy cancelled for false declaration which will have a material impact on premiums as most mainstream insurers will simply not entertain quoting so those that do will know there is much less competitive tension on the price.

If you do a quote on their website for a 4 bed property will they insure it? If you are buying from an intermediary you have to make sure its the same underwriter as your former policy as otherwise your not comparing like for like.

Non-Disclosure rules depend on if they deem it intentional/reckless or careless. If it's Intentional/Reckless they can always void the policy. If its careless then they can only void the policy if the underwriter wouldnt have accepted the risk with the correct declaration, if they would then they cannot cancel the policy but instead can reduce any claim by the percentage difference in premium had you made a correct declaration.

XRS200

How many bedrooms do you have? How many did you tell them? How many are they saying there is?

MyRealNameToo

https://forums.moneysavingexpert.com/discussion/comment/81888008#Comment_81888008

At a guess the OP is using 2 as bedrooms, declared there are 2 but the insurer/TPA has done a search and come up with the advert showing it was listed as up to 4 bedrooms.

In my opinion its a bit of a grey area and generally it comes down to how an estate agent would describe it so if you have an 8 bed house but convert one to an office, one to a games room, one to a walk in wardrobe the insurer would still want it insured as 8 bed despite three not being used as bedrooms.

It does get more complex if people are converting non-bedrooms into bedrooms etc.

dunstonh

From what you say, it sounds like a 2 bedroom property. However, have you by any chance left a bed in one of the downstairs rooms?

Usually, the question on bedrooms is along the lines of what it was built for or what it is being used as. Leaving a bed in a spare room downstairs would make it a three bedroom.

On the internet at sites like zoopla, you can find old listings of your property a lot of time. Not just the ones used when you bought by any previous ones from around 2012 onwards. If the property had sold before, you may be able to get the particulars and have those as a record.

What did the floorplan for the property show as room names?

To build your evidence, did you get a survey completed? That would say the number of bedrooms.

If there is a mortgage, did the mortgage valuation state the number of bedrooms?

Have you checked the planning portal for your property? Depending on age of property, how often permissions have been sought and for what reason, there may be references to bedrooms on old planning documents. (longer shot but you never know)

Cancellation, refusing the claim and no refund suggests they are treating this as reckless and deliberate.

Where the customer has made an honest mistake but has not taken reasonable care, the misrepresentation is treated as careless (sometimes called negligent or unintentional), and the insurer’s options are restricted to proportionate remedies. The firm must evidence what it would have done had the correct information been provided – for example, charged a higher premium, imposed an exclusion, applied a higher excess, or declined cover entirely. If it would simply have charged more, it can reduce the claim in proportion, so if the correct premium would have been £100 per month and the customer paid £75, it may only pay 75% of the claim

If the insurer can show the non‑disclosure or misstatement was deliberate or reckless – that the consumer knew the answer was untrue or misleading, or did not care, and knew or did not care that it was relevant – it can take the strongest remedy. In that case the insurer is entitled to avoid the policy from inception, refuse all claims, and keep the premium, on the basis that it would not have entered into the contract at all if it had known the true facts. - that appears to be what is happening here.

So, I believe you must make a formal complaint and provide as much supporting information as possible.

InsuranceQuery26

https://forums.moneysavingexpert.com/discussion/comment/81888046#Comment_81888046

https://forums.moneysavingexpert.com/discussion/comment/81888008#Comment_81888008

We have 2 x upstairs bedrooms, which is what I declared. The 2 downstairs "bedrooms" that were being used as such when we bought the property 9 years ago were the original lounge and a reception room in an extension.

InsuranceQuery26

https://forums.moneysavingexpert.com/discussion/comment/81888046#Comment_81888046

@dunstonh Thankyou for your reply. We have no beds in any of the downstairs room and there is only myself, my husband and my daughter living here and using the 2 upstairs bedrooms.

The downstairs bedroom that the previous elderly couple were using was the lounge of the original house. The ground floor extension that I think was added on a few years after the original build, in the late 1980s, had a room with a bed in it when we bought the house. The previous vendor said the room was built as a snug/living room.

I will take a look online and see what other information I can find, as the estate agent did present it as a 2 - 4 bed property. So this may be my albeit innocent error.

They have sent a letter stating "policy misinterpretation" and detailed what our premium should have been should we have declared it a 4 bed house.

They also quoted this: Our quote process includes a helper text on the number of bedrooms as follows:- “This includes bedrooms that have been converted e.g. studies”  However, none of the two ground floor rooms they claim are converted were ever built specifically as bedrooms, to our knowledge.

My main concern is not being able to get insurance moving forward and whether I need to cancel this policy rather than waiting for my current insurers to cancel it, and if that would help my case for getting another policy in future.

It's all very stressful to be honest, and I am feeling out of my depth. I was wondering whether to get a lawyer involved.

dunstonh

It's all very stressful to be honest, and I am feeling out of my depth. I was wondering whether to get a lawyer involved.

That would take months or even years and would be at your cost. The regulated complaints process is free-of-chage to use and gives the firm a chance to give their reasons or change their mind before you have access to the ombudsman. The complaints team of a firm tend to have more discretion and thinking ability than front line call centre staff

Annemos

If this is accurate: I would also point out which downstairs rooms only had a bed in, due to the fact that the previous owners had become elderly and could not sleep upstairs anymore.

(My grandparents only had a bed put in the downstairs living room when they became very infirm during their last couple of years.)

Yes, as dunstonh has said and described, please do get all the facts together and write a complaint (according to the Complaints Procedure in your Insurance Policy). Then go to the Ombudsman, if you feel they are still acting unfairly.

MyRealNameToo

https://forums.moneysavingexpert.com/discussion/comment/81888389#Comment_81888389

If you look on RightMove or similar at the sold house prices how does it describe your home?