Home insurance claim: settlement figure

[Runningupthehillagain]

We had a house fire a few months back. Covered for home and content with Aviva who have been a nightmare to deal with from the start. It’s a large claim.

The claim hasn’t gone to underwriting yet but our loss adjuster has made it clear we will be expected to take a cash settlement.

For various reasons, this doesn’t work as our home isn’t habitable and needs reinstatement.

Aviva holds quotes from builders etc for the reinstatement work but they will not share these with us.

I’m interested in hearing from others who have experienced similar, how it played out, and if they took as cash settlement, did it cover the full scope of works?

We’re very much in the dark here and Avivia have been very unhelpful in providing any sort of guidance.

It’s pretty unusual to have a cash settlement for buildings when there’s extensive work needed, insurers usually use an approved contractor and the loss adjuster effectively project manages the job making staged payments. Have they said why they are looking at a cash settlement, is it possible the building is under insured?

Cash for the contents claim is more common, just check they’re costing for the right level spec and haven’t deducted discounts from their suppliers.

Home insurance was set based on our home survey when we purchased a few years ago and it’s an index linked policy so it shouldn’t be under insured.

Getting information from the loss adjuster has been painful.

We also used the BCIS calculator as advised by Aviva when we took the policy out. And went over that too.

Hoping this might just be miscommunication from them.

With the current instability in construction materials and finding contractors I wouldn’t be accepting a settlement. I don’t see how they can force you.

If it’s been a few months I’d expect a clear plan by now tbh, and would start going through their complaints process. Unless there’s a complication (eg non standard construction, concerns about policy cover), you should have a contractor appointed and a date for work starting.

We have gone through their complaints process and have been offered £150 due to delays caused by them. We will go to FOS but we’re waiting to hear more but we don’t know when that will be, or the next steps. We haven’t seen sight of quotes.

I don’t feel they can force a cash settlement, especially as our home is inhabitable so they would need to continue to pay for our temporary accommodation but we don’t have any real answers and it is concerning.

Our home is of normal build, nothing unusual - not listed. And, as far as we are concerned, was insured appropriately. In fact, it has just renewed for the same amount of cover.

Look into getting a Loss Assessor if you’re not getting anywhere.

@Runningupthehillagain I cannot see what’s wrong with a cash settlement. We have had one. You will need to know your schedule of works to know what your costs are though. dH is very clued up so we got what we expected. Cash enables you to make choices. We had enough for high quality flooring because we saved on other things. You choose how to spend the money but check it’s enough.

I would second finding and appointing your own loss assessor. They will be worth every penny. People who haven't been through a house fire themselves have no idea what lies ahead if they ever have the misfortune to find themselves in that situation...

Agree with this. A loss assessor acts in your interests (whereas the loss adjuster is acting in your insurer’s interests).

Have you checked your policy terms to see what it says about reinstatement and what your options are?

A loss assessor or claims management firm is also a good idea in the event that a cash settlement is put forward. From personal experience, insurers may offer a cash settlement that does not reflect the true costs of reinstatement if you were to appoint a builder yourself (because their settlement amounts are based on figures quoted by contractors to get on the insurers’ panel, but these contractors may not want to actually work on sizeable reinstatement jobs).

We have spoken to a few independent loss adjusters but we were too far down the line for them. Agree, we should have appointed one earlier but we had no idea what was involved at the time.

@MeetMeOnTheCorner thank you, that’s positive. Can I ask, did the settlement include alternative accommodation while the work was being done? I haven’t signed off on the scope of works as I wanted time to review it. I fed back our thoughts and concerns two days after receiving the scope after getting some advice and every comment was met with a rebuttal. These were comments like including contingency for unexpected issues (they hadn’t had a plumber or electrician scope the works).

@Runningupthehillagain No because our repairs were not too extensive. However a friend hired a mobile home on his land during a big repair job. The roof had partially gone! So yes, reasonable costs.

You could ask for the cash settlement in stages, so the claim would be open for the entirety of the works with payments as the work is quoted for or undertaken.

If you're truly not comfortable with cash, you need to state it very clearly in writing that you don't feel able to manage the works, that it's overwhelming and you do not want cash.

The FCA is crawling all over large cash settlements in home insurance right now and Aviva will have to justify why cash was appropriate. Make them sweat and ask them why they think it's appropriate for you.