help made a claim on home insurance i am under insured

[kell4040]

hello i made a claim on my home insurance for my laptop

sent off all that they needed i didnt here anything for 2 weeks so i rang them and asked how long the claim would take they had sent me some forms to fill out about what i had in the house and how much they cost etc i filled these in and sent them off.

they told me i was under insured i asked them to explain to me and they said that i was only insured for 2600 for a 3 bed house that i own.

i couldnt belive it i said they must of been a mistake i hunted my insurance docs out and there it said 2600 i dont no how i have missed it i had done everything online so dont no how it came to that my other insurance i was insured for 40000 and told them this.

i had even put the laptop down for 500 for high risk the man said i should of known something was wrong when i paid as it was low i said my last insurance was only £40 more so didnt think anything just thought it was because i had an extra years no claims.

i asked the man who was the underwriter if i could get it for 40000 like my last insurance as it wouldnt even cover my suite for that amount yes its my mistake as i should of noticed the amount but i didnt.

as i said to the man why would i insure my 3 bed house for under 3000 pounds he said i had done it on purpose.

i am worried the insurance with them doesnt cover anything so if god forbid anything happen in my home i wouldnt be insured.

he wont up my insurance and said it could take weeks to sort out i cant get other insurance at the moment because this claim is pending and i am under insured what can i do the man was real nasty i didnt do it on purpose it is a mistake that i didnt no of until i made the claim for laptop.

i dont no what to do

[vusys1]

hello i made a claim on my home insurance for my laptop

sent off all that they needed i didnt here anything for 2 weeks so i rang them and asked how long the claim would take they had sent me some forms to fill out about what i had in the house and how much they cost etc i filled these in and sent them off.

they told me i was under insured i asked them to explain to me and they said that i was only insured for 2600 for a 3 bed house that i own.

i couldnt belive it i said they must of been a mistake i hunted my insurance docs out and there it said 2600 i dont no how i have missed it i had done everything online so dont no how it came to that my other insurance i was insured for 40000 and told them this.

i had even put the laptop down for 500 for high risk the man said i should of known something was wrong when i paid as it was low i said my last insurance was only £40 more so didnt think anything just thought it was because i had an extra years no claims.

i asked the man who was the underwriter if i could get it for 40000 like my last insurance as it wouldnt even cover my suite for that amount yes its my mistake as i should of noticed the amount but i didnt.

as i said to the man why would i insure my 3 bed house for under 3000 pounds he said i had done it on purpose.

i am worried the insurance with them doesnt cover anything so if god forbid anything happen in my home i wouldnt be insured.

he wont up my insurance and said it could take weeks to sort out i cant get other insurance at the moment because this claim is pending and i am under insured what can i do the man was real nasty i didnt do it on purpose it is a mistake that i didnt no of until i made the claim for laptop.

i dont no what to do

 

dont panic.

 

1st off start a complaint about the consultant who has implied that you have commited fraud to obtain cheaper insurance.

 

2nd,double check the contents sum insured is £2,600 and not £2,600 for high risk items etc within your total contents cover

 

3rd. Insist that your cover is increased, its YOUR policy,by them knowingly underinsuring you they are breaching FSA

 

4th. Check you policy r.e cancellations, if you cancel you may have to pay the full premium due to open claim,but as its so low at the moment it may be worth it just to take out cover with another insurer who will cover you adequately.

 

5th. Keep ringing,why cant they increase your cover??? woud they take this long if you wanted to reduce cover??? I think not.

 

6th. Iam surprised that their web site allowed you to input £2,600 despite it being a 3 bedroom house...

 

 

what company is it?

[unclebulgaria67]

I suspect it is £2,600 for 'high risk' items and not £2,600 for the whole sum Insured. The Insurers will have a minimum sum Insured of probably at least £10,000.

 

I am suprised that the Insurers internet site allowed you to make this mistake.

 

In future don't arrange cover online. If you do that it is your mistake and you could lose thousands in the event of a claim. If you had arranged it by phone, this mistake would not have been made and you would have had some comeback on them if they had made the error.

[MrShed]

As clearly there is basically zero cover for the laptop, can you not simply withdraw the pending claim...? Or maybe I am oversimplifying.

[kell4040]

hello thanks for the info my insurance is 2600 and 1500 for high risk items.

spoke to them on phone he says they cant up the insurance as there is an open claim with the laptop and until this is sorted we cant up insurance i am worried as i need insurance dont like not to be insured.

i try to get other insurance but because there is an open claim most wont do it .

[kell4040]

the laptop was insured under high risk items of 1500 in a way i am glad about the laptop as thats when we found out how low we was insured for.

[MrShed]

But thats what I'm saying. To my mind:

 

1) Withdraw claim

2) Take out insurance elsewhere (as you will not longer have an open claim)

 

The claim doesnt appear like it will be successful anyway, or at least not to any value, as you are underinsured.

[unclebulgaria67]

the laptop was insured under high risk items of 1500 in a way i am glad about the laptop as thats when we found out how low we was insured for.

 

Suggest that you make a complaint. The Insurers systems per FSA rules should have some in-built protection to avoid policyholders becoming underinsured like this. Suggest a written complaint threatening to take this to the FOS and to report the details to the FSA. Tell them that you are happy to pay the relevant premium backdated to have the appropriate level of cover.

[kell4040]

hello thanks for the reply i have just rang the insurance up and asked them to stop the claim.

he went away for 10min and said that the claim had been voided and they were cancel our insurance.

i asked why they didnt tell my partner this morning on the phone and he couldnt answer me.

i had asked to pay to up date my insurance so i had proper cover they were not intrested.

now i have no insurance no laptop and when i get insurance now it will cost me a arm and a leg i couldnt understand how i got it to 4000 for my insurance but the man said i may have missed 0 off when i put it online. he said i have to declare everytime now that i have had a void and cancel insurance do i have to tell everyone when i get insurance re new car insurance etc were do i go from here please help thanks

[MrShed]

This doesnt sound like a legitimate reason for them to withdraw cover....

[unclebulgaria67]

You need to make a strong complaint to the Insurers as a matter of urgency. You need to overturn their decision to void the policy, as otherwise this will cost you potentially thousands in extra premiums over the coming years.

 

I would suggest that you threaten to involve the FOS, report to the FSA and contact BBC watchdog about the way that you have been treated. They appear to be making a massive error, as a result of you missing a '0' from the sum Insured. As I mentioned in my last post, the Insurers must have a minimum sum Insured and systems in place to stop customers from under-insuring. The FSA would require the Insurers under the conduct of business to have robust systems in place, to ensure this sort of consumer error does not happen.

[MrShed]

Even if it wasnt for that regulation UB, are their defined grounds for cancellation/withdrawing of insurance?

[unclebulgaria67]

They can void a policy for deliberately under-Insuring. This is obviously a mistake, hence why I think the Insurers are making an error to void the policy.

[kell4040]

hello thanks for reply i have not deliberately under insured my home why would i as if anything did happen i wouldnt be insured.

our last insurance was 40,000 and the one before that.

this was a honest mistake that is going to cost us dearly. i am so upset we dont have insurance now and all our insurances we have to tell them about this.

this insurance is in my partners name only he has only spoke on the phone twice once to make the claim and then today they just said they would get hold of him in the next few days about the claim.

my partner is not pleased as they have been dealing with me over the phone most times when he is not here

i am not named on the insurance only him he only found out off me today when i phoned him and told him what they had done with his insurance

he said they had no right to do this.

i have spoken to fos and my partner needs to give them details of what has gone on.

i have never had to deal with anythink like this at all but due to one mistake it has made our life hell please any info i would be greatful

[unclebulgaria67]

Let the FOS sort out.

 

The Insurance company concerned have to give you a minimum of 7 days notice in writing of the cancellation, so you have a chance to make enquiries. As you are not named on the policy, the notice on the phone is not adequate.

 

If you phone the BIBA helpline, they should be able to advise you of brokers who can arrange alternative cover.

 

http://www.biba.org.uk/ConsumerHome.aspx

[kell4040]

hello again here has what has been going on.

i spoke to fos and they told me to put in a complant that i did today. i have just come off the phone from insurance as my partner as far as he is concerned does not no that his insurance is getting cancel/voided.

this came from me when they spoke to me on the phone again and gave me all this information. i am not named on the insurance and he was never here when they spoke to me in the past so have they broke the rules of data protection act.

i spoke to them and said if he has not got a letter confirming insurance cancel/void then he should be able to cancel now over the phone they said he cant do that as it has gone to the underwriters and they have said they are in process of voiding it and cancel i asked why and she said it was up to the underwriters and he cannot cancel he has to wait for letter i said that as far as he is concerned he doesnt no anything about this as he has not spoken to anyone and he only got the info off me when he got home from work so i am the 3rd party that they spoke to without my partners say so what rights do we have what a mess they havent told us why it getting cancel/voided they said we would have to wait for the letter to arrive please help

[unclebulgaria67]

Yes they have broken the DPA discussing this with you.

 

Sounds like a very unprofessional company.

 

Please do name them, so that other people don't make the mistake of using them.

 

What is your partner doing about this. They need to deal with this, by getting on the phone to their head office and making a complaint to the most senior person that is there. I would be jumping up and down going mad.

[kell4040]

hi feel like we are getting no were fast put in a complant letter to them did it r.d they should get it today i dont want to mention anything who the firm is at moment as i dont no who will see it.

have not got a letter saying it has been cancel/voided yet so still dont no why this has happened.

its like we have just had a life sentence as what they have done they do to many people and we dont have a leg to stand on once you have something cancelled you have to tell everyone for the rest of your life how can this be allowed there should be more in place so that they cant just cancel and mess peoples lifes up for ever this has affected me real bad i feel like a criminal and have not done anything wrong

no one seems to care.

[kell4040]

this is what has happened so far

we wrote a letter to insurance firm asking to cancel policy this was done on the 13th oct as we had not had a letter confirming policy was going to be voided due to it being under insured.

wrote a letter of complaint to them on the 12th oct stating that i think it was unfair that they were going to void policy as it was a an error that we didnt see until we had put a claim in for laptop.

we had missed a zero out when it was done online my partner thought he had looked at it proper when paper work came through but thinks he may of read it when he didnt have his glasses on( he needs new ones but cant afford them at moment)

we got a letter today 23rd oct this is dated 22nd oct this is the reply to the complaint we sent they state they sent a letter on the 20th to explain why it was being void (WE HAVE NOT HAD ANY SORT OF LETTER TO SAY THE ACCOUNT IS BEING VOIDED)

they also say they wrote on the 14th this again is a lie as we never got anything.

they say they spoke on the phone on the 12th this was to me not my partner who name the policy is in only.

they also say that they gave me information on the policy as i had account number and policy details and was aware of the claim they say they appologise if we believe there had been a breach in data protection procedures.

due to all this my partner has try to end his life we dont have a lot of money and he needs insurance for his bike to get to and from work we are not going to be able to pay the hundreds of pounds now in insurances due to have a policy cancelled.

he wont be able to get to work he will lose his job the list is endless our lifes have been turned up side down and we dont see a end to it it has and will affect everything we do in the future and cost us thousands that we just cannot afford please can someone give us advice we need help quick thanks

[unclebulgaria67]

It won't necessarily cost you any more to arrange cover elsewhere. You just need to explain the situation that you had a policy voided from inception due to a mistake with the Contents sum insured i.e a missing '0'. If the reason given by the current Insurers is that the policy taken out was not on the correct basis, then I think they have to share some of the blame, as their internet site allowed this error to happen.

 

Suggest that you phone around to speak to a few companies and see what they say. Some companies might want to receive a letter explaning the situation, so that they have this in writing.'

 

As long as you phone companies and don't try to arrange cover online, you should be ok.

 

In regard to the current companies attititude, you should make a formal complaint to the FOS. Give the FOS a call on Monday with the details.

 

http://www.financial-ombudsman.org.uk/contact/index.html

[GeoffW]

Hi

 

I have 42 years experience of dealing with insurance claims. I do not waste time and effort in telephoning insurance companies - I might as well talk to the wall. I put everything in writing. This usually delays matters as first they have to find someone who can read and then, more difficult, someone who understands insurance law and proper practice. Not necessarily the fault of the employees - all part of reduced standards in all areas of the financial services industry.

 

However thats a big subject so turning to your problem, first of all don't waste time ringing them - write to them.

 

As someone else said, there will be a minimum premium. That premium must be considered sufficient for a certain level of cover which will exceed £2600 without any doubt whatsoever. You should write to them and point this out and say that notwithstanding what it says on the paperwork you had paid them premium for that minimum level of cover so that you are not underinsured or as underinsured as they say.

 

They are not automatically entitiled to refuse to pay a claim due to underinsurance. If, as I expect, there is a clause in the policy saying that you are required to insure for the full value of the contents, they cannot refuse to deal with the claim unless they can prove that the underinsurance is deliberate. The relevant legal case is Economides v Commercial Union. Quite clearly from your comments they will be unable to do that.

 

When you write to them you should say that you no longer wish to withdraw the claim. That was a mistake.

 

If they do not co-operate you then have to write to the Chief Executive of the insurance company to commence the formal complaints procedure. You have to ask for their final decision so that you can complain to the Financial OMbudsman Service. Then do that. The very fact that you complain will cost the insurance company £600 which they have to pay to the FOS.

 

However please be warned that patience is required. The FOS will take at least 6 months to deal with your complaint as they have a backlog - unfortunately there isn't an Ombudsmans Ombudsman to complain about the Ombudsman to!!

[kell4040]

thankyou for the reply

i have spokebn to fos and they told me to get a letter off insurance for final decision.

i got a letter off insurance when i first put in a complaint and it said

this

further to our letter dated 14th oct i have now had the opportunity to review your concerns raised about our decision to void your policy and repudiate your claim.

from your letter dated 12th oct i understand your concern is that you feel this decision is unfair and that you did answer the application questions honestly and accurately. also that it was due to an error that amount of £4,000 was entred at the time you arranged insurance instead of £40,000.

my colleagues letter dated 20th oct (I HAVE NOT HAD THIS LETTER)

has explained the reasons why we have treated your policy as grossly underinsured and taken the decision to void it from inception.

the letter points out that when you received your policy documents you were asked to check that all the information you entred at the time you bought your policy was accurate and complete including the sums insured.

according to our records no contact was mad by you to amend the contents sum insured (I RANG ON THE 11TH WHEN I GOT A LETTER FROM THEM SAYING I NEEDED TO RING THEM AND GET INSURANCE TO REQUIRED LEVEL)

we calculated that the level of adequacy was only 11% we define gross underinsurance as anything less than 60% the policy documents and policy booklet also explain that we reserve the right to treat your policy as invalid if the sums insured are inadequate due to the level of inadequacy a decision was made to void your policy.

your letter refers to insurers imposing minimum sums insured unfortunately we do not apply minimum sums insured the price comparision sites we use explain what should be insured and basis for valuing contents.

given this information we expect policyholders to ensure that the sums insured are adequate as explained above we remind policyholders in there policy documentation to check that the sums insured are adequate and to contact us immediately if they are not.

with respect to your partners call to the office i can ony suggest that she was provided with information concerning this case as she in turn had policy details and was also aware of the claim details. i can only apologise if you believe there has been a breach in the data protection procedures.

our records also show that i spoke to you over the phone on the 12th oct to explain that although we had written to you separately in conection with the possibility that you were underinsured an increase could not be applied due to an open claim. (this call was not to my partner it was me who spoke to them and they gave me this information)

for the reasons given above i am unable to reverse our decision to void your policy i understand you are going to be disapointed with my reply but i hope that i have clearly explained the process and the reason for our decision i also hope that this letter answers some of the points you have raised

we still have not got a letter to say that the policy has been cancelled and why it has there was a refund of the money what we paid over the months in the bank what wording shall i put in this letter please thanks again.

[GeoffW]

Hi Kell

 

A couple of things

 

First of all you need to see the letter which they refer to and which you have never received so please ask them to let you have a copy asap and then let me know what they say in the letter.

 

Secondly we need to find out how much cover you could have obtained for the premium which you have paid. The best way to achieve this is for a friend or relative who lives in the same area as you to get on to the same website you used and find out how much it would be for £40k worth of cover by pretending to apply for insurance. It is important that this person lives in the same area as you because premiums are based on postcodes. If they apply online and input the same cover details which you asked for except of course for putting in the correct figire of £40k, I will be able to calculate how much cover you have paid for as I believe that this will be the best argument despite what they have already said about that aspect. This can be done now whilst you are awaiting the missing letter.

 

Please therefore let me see the missing letter and let me know how your friend/relative gets on with the quoptation stuff and I might then be in a position to let you have a wording for what I believe to be a good letter to write to the insurers.

 

Please be patient - lets collect the ammunistion before firing it

 

GeoffW

[Mwynci]

I'm on your side here, apologies about the negatives, I like to work with the worst case

 

Agree about being able to see all the letters and the insurers reasoning for declining.

 

Making a policy null and void is a strong move, they would need to demonstrate they would not have taken on your risk with the correct sums insured. Right now the insurers are working on the basis that you have tried to rip them off, I think this will be hard for them to prove.

The negatives to work against (sorry), the FOS may request a payment based on an average, which I think you have said is 11% -(i'm working from page 1), you could ask for consideration of a retrospective premium, where you pay the difference it should have been, the FOS in my experience tend to go for the first.

 

A lot is being mentioned about the minimum premium, this is assuming your company has one, not all do. By using an agrigator you are putting yourself up for auction based upon the info you have given. If this is the type of custom your insurer deals with then they could be right by taking the low amount at face value and it could all be your mistake.

 

If this is the case, you need to gain sympathy from the FOS by providing evidence that it was a genuine mistake, provide copies of past insurance to show that you had always prior to this mistake had a reasonable level of cover. A clear claims history helps.

 

Forget about any breach of data protection, that will just muddy the water.

[GeoffW]

Hi Mwynci

 

The insurers can't apply average if there is no appropriate clause in the policy. I doubt of there is as they arentrying to repudiate liability and not apply average. They cannot succeed with this argument if they can't demonstrate that the policyholder has deliberately underinsured as per the decision in Economides v Commercial Union.

 

I understand what you say about the ombudsman. There are two problems there - the backlog and in my opinion lack of knowledge and understanding on the part of some adjudicators. There has been an hardening of attitude and they don't even always follow principals set down by themselves over the years.

 

GeoffW