As a buy to let landlord, you invested in property by way of a business proposition to generate income from the rents collected from your tenants.
If the property you bought suffers damage from subsidence, however, that very income stream may be at risk if tenants need to vacate the accommodation during the course of what might be a lengthy insurance claim for the necessary remedial works.
Sometimes, there may also be landlord subsidence issues with your insurers when you make a claim – such as you not agreeing on a settlement figure – so what do you need to do?
Resolving insurance disputes involving subsidence for landlords
Whenever you dispute the way in which your insurer has handled a claim, especially if you fail to reach agreement on the settlement offered, your first recourse is to the insurers themselves.
If you are unable to reach agreement and resolve the dispute, however, your further course of appeal is by way of a complaint to the Insurance Ombudsman (who is a member of the Financial Ombudsman Service) – who has reported on his adjudication of disputes between consumers and insurers in cases that might be of particular interest to landlords:
Repairs or remedial works?
- one of the cases, for example, involved an in insurer who agreed that property damage had been caused by subsidence, but who argues that the claim must be limited to repairs and redecoration only and not to remedial works to prevent further damage occurring in the future – the insurer agreed to cover the cost of “restorative”, but not “preventative” works;
- if you are a landlord, of course, you expect your subsidence insurance to cover more than any necessary redecoration and address the fundamental causes of the problem through thoroughgoing remedial works – your buy to let business depends on it;
- you may take comfort from the Insurance Ombudsman’s decision, therefore, to uphold the consumer’s complaint and rule that the insurer is responsible for settling the claim to adequately stabilise the building against future risks of subsidence;
- an altogether more difficult case arose when subsidence issues affected not only the insured’s home but also that of his semi-detached neighbour – a situation which might also be shared by the landlord of semi-detached buy to let property;
- although both the insured and his insurer agreed that subsidence was damaging the property and that remedial works were necessary, the neighbour had no subsidence insurance and wanted nothing to do with the planned remedial works – even though his own property was similarly under threat;
- after intervention by the Insurance Ombudsman, a more difficult, time-consuming and expensive plan of works was agreed for the stabilisation and restoration of the complainant’s home, leaving his semi-detached neighbour’s home untouched;
- as the landlord of buy to let property, you are almost certain to be on the lookout for suitable and competitively priced landlord insurance that provides cover against the risk of subsidence – switching from one insurer to another if a better deal is on offer;
- despite the potential for confusion as to whether the original insurer or your new insurer is responsible for handling subsidence claims which arise soon after making the switch the Domestic Subsidence Claims Agreement forged between the Association of British Insurers (ABI) and participating insurers makes clear the respective responsibilities of the former and new insurers.
Subsidence is likely to be the dread of any landlord of buy to let property – not least because of the loss of rental income pending the completion of any remedial works.
By arranging subsidence insurance as part of your landlord insurance through us here at UKinsuranceNET you may rest easy in the knowledge of our commitment to helping and guiding you through any claims process you may need to start.