Liability admitted - question of quantum

[gyzmo]

Been a while since I worked in insurance so need to check something:

 

A has contents insurance (new for old) with B for a council property.

Council has admitted liability for damage caused to contents through faulty workmanship which has allowed mould growth on contents.

 

A has obtained quotes for replacement of damaged contents on a new for old basis. The council however, states that is pairs out on a wear and tear damage basis, and is only offering A about 50% of the cost that it would be under new for old.

 

A has contacted his insurer who have said that they will make up the rest.

 

Now I say that As insurer should pay the full amount and reclaim that off the council, or that the council should offer payment on a new for old basis. Can anyone advise on what current practice is on such matters? I am somewhat behind the times.

 

Thanks.

[revolting peasant]

I'm a bit rusty as well but my own feeling is that the council liability extends only to reinstatement and that A would be unable to claim on the contents policy in any event as the damage is caused by gradual deterioration and not directly by any of the normally insured risks (I'm making an assumption there as you don't say what the nature of the faulty work is).

[gyzmo]

Not sure on the details - Wall treatment to remove mould and following brickwork. Both were botch jobs. I don't think there is a question as to cause or liability - its the amount offered. The council apparently said that they only indemnidy on a wear and tear basis, yet A'a policy is new for old. If A is entitled under his policy for new for old, then why should A not receive new for old from the council? If A claimed on their policy, then surely the council would be bound to pay A's insurer's costs?

 

And as the the insurer saying that they would meet the rest, that to me sounds like a cop-out. I think what they mean is that they can't be a***d pursuing a claim and are happy to settle 50% without even chasing that amount back.

[revolting peasant]

My point is Gyzmo that due to the nature of the damage I don't think A would be able to claim on the insurance policy as gradual deterioration wouldn't be covered

[gyzmo]

I think though that the cause of it is not a gradual event - the damage would not have occurred where it not for the faulty workmanship. Like I said, the council have already admitted liability on this issue.

[revolting peasant]

What I'm saying is that regardless of liability, it is unlikely to be an insured risk therefore we can take the insurance company out of the equation altogether.

 

The council have admitted liability so it is back to your original question of quantum and on that I think the councils liabilty extends only to reinstatement. If A has the admission of liability in writing then a threat of legal action might get a result but I'm really not convinced.

[gyzmo]

But the insurer has already stated that they will pay the remainder - so they will accept a claim (they have already been notified). It really does come down to quantum.

[revolting peasant]

Sorry, I misread your original post and I'm now missing the point.

 

Council pay 50%, insurers pay 50% - A gets new furniture - everybody happy.

 

An untidy way of doing things I admit but it works. The alternative would be for insurer to pay full amount and recover from the council which seems a little pointless if it can be resolved between the parties individually.

[gyzmo]

It would be, but the insurer paying 50% means a claim on A's policy, which means higher premiums (usually) and possible difficulty in getting insurance later if he switches (already had two claims). That is why I am saying the insurer should pay the full lot and claim it back from the council, or the council pay he whole lot to A.

[revolting peasant]

But the council will only pay 50% which I believe meets their liability and the insurer would have difficulty in reclaiming the full amount if they met the full claim.

 

The involvement of the insurer doesn't change the council's liability

[gyzmo]

Well have spoken to the insurer today on behalf of A. As a former employee of the insurer (one of several I have worked for - not naming them!), I managed to speak to the senior tech guys who have assured me that there is no reason why full indemnity should not be obtained.

 

A is now putting the claim on the policy. Will see how things go.

[sang33ta]

Mould is natural over a period of time of there is poor air circulation and no maintenance.

 

Make sure there is air flow behind furnature (dont hide your stuff under/behind sofa), open the windows now and again to change the air and remove window condensation, and if you see any mold use some Detol Mold & Mildue Remover.

 

I'd say they are getting a fair offer for something that could be considered failure to maintain. Mold don't just appear suddenly.

[revolting peasant]

Well have spoken to the insurer today on behalf of A. As a former employee of the insurer (one of several I have worked for - not naming them!), I managed to speak to the senior tech guys who have assured me that there is no reason why full indemnity should not be obtained.

 

A is now putting the claim on the policy. Will see how things go.

 

I have to say I'm surprised but well done;)

[gyzmo]

Oh I can see a fight coming on. The insurance company have turned round and said that the damae of rot / damp is not covered on the policy and so they will not pursue the matter. No legal expense cover either.

Going to argue that the prime cause is not damp but the thing that caused the damp - the faulty work.

 

Also need to know of any precedence of this if anyone has any to hand - with the council admitting liability but only offering wear and tear. A has been screwed enough times by the council over various cock-ups on their part that have cost her dearly, and I do not intend this to be another one.

[revolting peasant]

Gyzmo

 

That pretty much confirms my own thoughts on the matter and I think the insurance company are out of the frame now.

 

I still stand by my suggestion that the Council, even having admitted liability, are only required to reinstate and the only option open to A now would be to issue proceedings against the Council. It might persuade them to meet the full value of A's claim but to be honest I would strongly advise against it because if the Council were to win, which I suspect they would, they are duty bound to recover their costs. It would almost certainly turn out to be an expensive exercise for A

[revolting peasant]

Going to argue that the prime cause is not damp but the thing that caused the damp - the faulty work.

 

Quick PS - how long after the work was carried out was it found to be defective?

[gyzmo]

I have no idea as to the last one - I don't think A does either. However, A has contacted the council again and someone is is reviewing the file. I think A will be accepting an offer from the council which is slightly higher than initially offered. I personally don't agree, but A does not want to take a fight on (which it will be) - has had to put up with enough already. Should get a response today or tomorrow.