Insurer won’t replace like for like

[Okly]

Hi,

My parents had a pipe leak in the kitchen. It’s an engineered wood floor (daft but was they were unaware at the time how unsuitable it was). To replace it like for like with the same brand would cost £4,850 for the materials alone but with a laminate floor it would be around £3,300 which they are happy to do.

They have been offered £1,700 and told they cannot negotiate the cash settlement. The insurance company have offered to send one of their contractors out but I have no idea what materials they would use.

Where should they go from here?

Thanks!

What does the insurance policy say?

I’d have the contractor round and see what they say tbh. Does the whole floor need replacing?

Insurers always wriggle out of paying for stuff. They should query it, but it could just be rubbish cover.

@Motnight It won’t let me copy and paste but basically says they will cover the damage caused by escape of water as per page 19:

docs.policyexpert.co.uk/home/qgl10/home_pesilverhome_wording_0622.pdf?_gl=11xgmd2r_gaOTIwMjY5NDUuMTY3MTE0NTAwNw.._ga_NGNFMDBK2K*MTY3MTU2MTU2MC4yLjEuMTY3MTU2MTU2NC4wLjAuMA..

@bloodyeverlastinghell Yeah, there is no way to replace just the damaged section.

@jtaeapa It is Policy Expert Silver. It seems decent on paper but maybe not in reality 😕

My DH argued his case when his insurer wasn't going to cough up the like-for-like replacement value of his burnt-out car, and his persistence paid off.

Insurance companies will always do whatever they possibly can to pay as little as they can possibly get away with. Don't accept their first offer.

That seems a surprising amount less than the cost of the floor - has a valuer / loss adjuster been out to see it? Also, have they said anything about being 'under insured'? Rebuild values have gone thru the roof and if your DPs policy hasn't been adjusted for that then they may find they're not covered for the full value of the claim. (say the insurer says they are 30% under insured, they'd value the claim and pay 70% of the value only)

Keep arguing. Insurers always offer a ridiculously low first figure in the hope you’ll accept it.
Document all correspondence in writing, stick to the point, include quotes from the policy etc.

Insurance companies really annoy me. Have your parents sent them estimates for the proposed work? It looks to me like the insurers are offering approximately half the lower quote.

And they have been told they cannot negotiate? That's not true - they can.

How old was the floor?

Keep chasing it. How old is the floor? How much did it cost initially? What condition was it in before the leak? These are all things that they take into account when making an offer so you need to have the answer for them. I would let them send someone out to view it all.

I remember when our house burnt down the insurers were just twats.

Tried to argue our integral garage was t integral. Even though you could see the alternating brick pattern.

Your contract says the insurer has the right to appoint a contractor and arrange for repairs.

So you need to let them do that and insist it is engineered wood etc.

They are offering you cash in lieu - but that doesn't mean they'll pay cash for your selection of "like for like" floor/ supplier/fitter.

Make a compliant to the insurance underwriter, policy expert are the broker, the underwriter will be listed in the policy. Complain about the value of the cash in lieu payment and if they refuse the complaint, refer it to the Financial Ombudsman service for free. The FOS are great & have had a lot of success overturning insurer's decisions

It still wouldn’t be enough, but have the taken into account the £500 excess? That makes the offer equivalent to £2,200, so not quite as far apart from the actual cost.

They should definitely not accept the offer though.

You need to write a complaint, and clearly label it as a complaint.

They are government by the FCA, and have to resolve your complaint to YOUR satisfaction within 8 weeks. At the 8 week point, you can refer to the ombudsman.

Do not accept anything other than like for like. I worked in insurance for many years.

Thank you everyone. Your advice is very helpful and appreciated.

Apologies, I did not mean to post and dash but things got in the way.

This is what they said (it’s an online portal):

“We would not be able to negotiate the settlement as this cash value is based on how much is would cost our contractors to complete the works and therefore would be our limit of liability for your claim. If you are unhappy with the cash offer, we can instruct a contractor instead to complete the repairs for you. Thank you.”

I sent back a message explaining that a replacement like for like would mean close to £4K for materials alone but if they want to instruct a contractor to please go ahead.

If they refuse to replace like for like I will do what @YoSofi suggests. I’m not going to let my elderly parents get fobbed off.

Seems fine, if they want the work down anyway then it’s much less hassle to let the insurance company go to the butcher of finding and managing the contractor. They may well be able to get better rates than your parents could in the open market.

Typos! Down-done
butcher-bother!

But of course they need to be very careful to make sure right materials being used.

If the insurance cover is like for like then they should replace it. Tell them you are taking it to the insurance ombudsman. They will take it up for you.

Read the policy. It will tell you if they paid for "new for old " cover, or not.

New for old isn’t the same thing as like for like.