Insurance claims are major business for lawyers, builders, salvage companies, Insurers, brokers, bank managers, Revenue, the Gardaí and loss assessors and loss adjusters alike.
Even though the vast majority of property and injury claims settle perfectly fairly, there is major fraud happening on both sides of the claims process.
This has been going on forever and will continue. The honest claimant is therefore at a major disadvantage in the claim process.
This is for a number of reasons – Insurers write the policy and they dictate what is insured but more importantly what is not insured. Insurers define the claim management process, they use experts and are experts in managing that process and their expertise is supporting their position. It is not in the interest of the Insurers to make it too easy. Insurers adopted the position for many years that the claim process was under their total control and that the loss adjusters acted purely for the Insurer and in fact that the insured was not entitled to independent professional advice.
The game has changed to some extent but there is further to go.
The Consumer Protection Code went some way towards rectifying this position. It has not solved the problem fully. It does require Insurers to notify the claimant that they are entitled to professional advice but at their own expense, i.e. it is not an insured fee. Ironically, this is an area that insurers can, and in some cases do, actually cover in the policy – but they are few and far between. The Insurers that do cover the fees generally try to control who they pay for, and at what price so it may not be a decision for the claimant to make in their own interest.
In my view, it is grossly unfair particularly in larger claims where the costs of processing the claim are driven up in many cases by the Insurers’ investigations. It is wrong that the claimant who has suffered loss and damage to their property or business should have to bear this cost (loss assessors fees), when it is in consequence of the insured event and therefore should be insured.
It is absolutely clear that the claims process is extremely complicated. Even a chimney fire today could involve a broker, an lnsurer, a loss adjuster, the fire brigade, and various builders who quote for repairs. CCTV reports to clarify the extent of damage to the chimney flue possibly even forensic investigations in some instances. The only party who can co-ordinate this with the Insured’s interest in mind is the Loss Assessor.
It is most unreasonable for anyone to expect a person who works in a factory or the owner of a hotel business to understand all the complexities of an insurance policy.
It is a fact now that insurers are reviewing claims history, disclosure at inception of the policy, the cause of the damage, the likely cost of the claim, forensic investigations and many more aspects of the claim before accepting liability and offering to pay any money.
These processes can take many weeks at least and many months at worst.
In the past 10 years in Ireland even though many many claims are settled and paid by insurers and people are generally satisfied, there are equally many claims that end up in the in the Courts or Arbitrations.
Insurers have not, in the recent past, covered themselves in glory, the issues that FBD had in relation to the rebuilding of many of their clients chimneys in private houses hit the headlines a number of years ago. The work was grossly unsatisfactory and it was identified by Engineers that some of the repairs were actually dangerous. This clearly was an exercise by Insurer in saving money that backfired.
We have also recently heard about the RSA issue with claims processing and reserves and how that impacted on the revenues for the company throughout Europe. It is also less known that this approach to processing claims actually filtered down through to the loss adjusters and claims handlers and the whole claim process in RSA slowed down dramatically and became grossly unsatisfactory. The Chief Executive lost his job in consequence but that didn’t help the unfortunate whose house burnt down or flooded.
We are also all well aware of the Quinn Insurance methods and approach to their client’s claims and how the public view of the claim process in Quinn insurance was far from acceptable in the context of the requirements of the Consumer Protection Code and the needs of somebody whose house just burned down – had a mortgage – in negative equity – and there no access to alternate funds.
This is when you need your insurers to be on side and honouring the contract fairly and fully. The doctrine of “utmost good faith” applies to insurers as well as insured but if you are on the wrong side of that issue, it is virtually impossible for a person making a claim to even consider trying to argue that point legally.
Cleary’s have found in the recent past that if your Insurer is causing problems in the claim process, where slow decisions of acceptance of liability or investigations going on for months and months – it is extremely stressful & highly technical. This brings a financial pressure on the claimant that may force decisions one would otherwise not take.
We have a case in process at the moment where Insurers instructed loss adjusters to visit the site on day 2 after the incident. Loss adjusters reported within 2 weeks to Insurers. On day 16 a forensic investigator was appointed who visited the site, interviewed witnesses and also reported to Insurers and this took a further 4 weeks. Four weeks after that, we heard from the Insurer’s lawyers asking further questions and looking for further detail about the site and the circumstances of the fire. We believed complete detail had been presented already to the previous two parties. A letter then arrives from that the lawyers looking for further detail giving us another six weeks to reply. While all of this is going on, liability had not been accepted and the six figure loss is impacting on the client’s business. The client cannot make decisions because the Insurers have neither accepted liability nor repudiated liability. It is now week 16! The owner does not know where he stands. He may actually prejudice his own position if he pays for the repairs himself.
This highlights the inadequacy of our current Consumer Protection Code and indeed the claim processes. The only message is to get your representation early and hope that all goes well.
Clearys Claims ManaWhgers
Follow these tips to help prepare for high winds and freezing temperatures this winter.
When strong winds are forecast:
What you should do after a storm:
Preparing for freezing temperatures:
A burst pipe in your attic, if unaddressed, can be as devastating as a flood through the front door. It probably represents the greatest risk posed to your home by freezing conditions. Freeze thaw action can also cause structural damage.
How to prepare for the freeze:
In the event of a burst pipe:
In the event of a leak:
Frost damage is one of the risks of property ownership that many people overlook. Of course, if your property is well constructed and you live in a temperate climate, you probably don’t have anything to worry about. But even so, the last few winters in Ireland have been especially harsh with more and more incidences of frost damage occurring. So what should you do if your property suffers from frost damage?
The most detrimental side effect of frost damage is burst water pipes, especially underground pipes. Not only can this lead to further problems such as high water bills, but there is no way of telling where the burst is or how bad it is without the help of some expert professionals, so it pays to be prepared. As a preventative measure, you should ensure that your property is adequately insulated, especially the roof. You should also consider insulating the walls.
In the event of frost damage, it is vital that you turn off all taps completely, as drips can freeze and block the pipe, adding further hold-ups and possibly damage. Also ensure that all stop taps and valves have been switched off or closed. Next, you should thaw any exposed pipes by placing a cloth soaked in hot water over them, or alternatively, a filled hot water bottle. Do your best to keep the property warm; use electric heaters if you have reason to believe your heating pipes may be damaged from the frost also (although this is unlikely if the heating been used recently).
The next step is to contact an underground leak detection professional who can search for any inaccessible pipe damage. At this point, you should also contact a loss assessor who will visit the property, gather records and make an inventory of damage, estimating the amount of losses as a result. Once the loss assessor’s survey is complete, you can submit an insurance claim and commence repair works; however, be sure to keep records of what repairs are carried out and all details about them, as this will aid your claim.
Once any damage has been repaired and your insurance claim has been processed, it is worth investing in pipe insulation to avoid a repeat occurrence. This is best done after the adverse weather has improved so it can be completed without delay and will not have any further impact on your property.
An escape of water below ground usually comes in the form of burst pipes or damaged plumbing systems which cause damage to properties either by water seeping into the building from below, or in less severe cases, by affecting water pressure and flow in the plumbing system of the property.
In both cases, if the problem is left unnoticed or unfixed in the long term, significant damage can occur. If such an incident occurs, here is some advice on how to handle the situation:
In cases where below ground escape of water has been occurring for years, subsidence can be a problem. This is when the soil under the property’s foundations has become unstable due to water washing away the soil particles. As a result, the foundations of the building begin to subside. A thorough check on this should be carried out in any significant case of escape of water below ground.
The Office of Public Works recently published a guide to restoring your home or business from the recent floods in Ireland. We suppose that almost a month after the disaster the initial restoring works like cleaning are already done, but if you still struggle with the longest process of all – drying you place, then we can help you. Here is a short guide to how to deal with remaining water or moisture in your home or business building.
Air circulation is the best way to dry out a property and clear the air inside. Be patient and make sure the property is completely dry before you move back in.
Some Do’s and Don’ts:
Drying the property:
If you haven’t still contacted you insurance company for a claim settlement, you can always first refer to an expert loss assessors company like Clearys Loss Assessors. Hence, you might get an additional advice and guidance for obtaining a better settlement.
The storms last night in Lahinch and Salthill in Galway have left homes and businesses in ruins. It will take some time to estimate the damage.
Clearys Loss Assessors can assist you with any claim that you may have in relation to property damage, structural or flood.
Call our office today on 1850 28 1850
At the end of October 2013 the Central bank of Ireland published a report with findings of a themed inspection into household property claims resulting from water damage.Given the increased frequency of floods in recent years the Central bank considered it important to make an inspection of the compliance with the Consumer Protection Code (the Code) between 1 July and 31 December 2012 in 10 of Ireland’s largest non-life insurer’s (approximately 90% of the Irish property insurance market).
With regard to this inspection the Director of Consumer Protection, Bernard Sheridan said that the Central Bank expects all regulated insurers to work in the consumer’s best interest by selling suitable insurance policies, providing clear information and handling claims properly when they arise, directly or through a third party such as a loss adjuster. He expressed concern by the findings of this inspection which show a lack of transparency around the claims retention policy and policy terms that consumers need to be aware of at time of purchase and when making a claim. The Central bank considers that policy booklets contained a number of terms and conditions which may not be fair or transparent to consumers.”Consumers can often feel vulnerable when they experience damage to their home and that it is important that firms deal with their claims in a prompt and fair way. ” said also Mr. Sheridan.
One of the most important findings from the review were that most common reasons for insurers declining claims were either no insured peril or wear and tear that had occurred to their property, e.g. the sealant on a shower tray having fractured over time. It was also noted that many consumers had withdrawn their claim on learning that an excess of up to €1,000 would be deducted from any claim settlement offer, as well as the impact that the loss of no claims bonus would have on future renewal premiums.
The Central Bank also considered that insurers’ policy booklets contained a number of terms and conditions which may not be fair or transparent to consumers, and therefore insurers have been requested to review aspects of their respective policy booklets. Examples of the terms that insurers were asked to review include references to policy excess amounts or administrative fees without actually stating how much these are or where the consumer can find this information and failure to include information about retaining a portion of the settlement until after reinstatement will be a condition of the claims settlement agreement.
A review of insurers’ policy booklets revealed that only one of the insurers clearly describes the practice of retentions in its policy booklet. All of the insurers have a practice whereby a retention amount may be applied to a claim settlement offer and typically the retention withheld would be between 20% and 30% of the settlement amount. In order for a retention amount to be paid, consumers are required to provide either receipts, invoices or other proof that the repairs have been fully completed. The Central Bank noted that 23% of the monetary amount of all household property (water damage) claim retentions applied by the 7 inspected insurers during 2012 were never claimed by the consumer.
What Clearys advises you is to always read very well your insurance policy and in case you have any doubts or ambiguity, do not hesitate to contact a loss assessor.
Government statistics show that electricity causes more than 20,000 fires a year – almost half of all accidental UK house fires. Each year, about 70 people are killed and 350,000 are seriously injured due to an electrical accident in the home. Although many incidents are caused by faulty appliances rather that the electrical installation itself, a properly-installed and well-maintained installation could significantly reduce the possibility of an accident or injury. So, it is important that any electrical installation work is carried out only by people who are competent. This means people who have the knowledge, skills and experience needed to avoid dangers to themselves and others that electricity can create. It’s easy to make an electrical circuit work – it’s far harder to make the circuit work safely.
How old is your wiring?
Electricity is usually out of sight, out of mind because cables are conveniently hidden inside our walls and switches and sockets. So it’s not surprising that we forget to check our electrical installations for wear and tear. Faulty and aging wiring is one of the major causes of electrical fires in the home. You can avoid these by having regular checks carried out on the condition of your cables, switches, sockets and other accessories. There are clear signs that can help you tell the age of electrical installation in your home. These are:
This article is from the Independent newspaper on Tuesday 22nd April, 2013 and shows how policyholders are shortchanged by Insurance Companies.
Contact Clearys on 1850 28 1850 is you feel you need help with your insurance claim.