Insurance - whose risk is it if remedial works fail? The insured party or the insurer?

[2019change]

Please can someone explain the difference, if any, between an insurer paying a contractor directly (the contractor chosen by the insurer) or paying the insured party who then pays a contractor. I do not want to find myself having to argue with the contractor should the work fail in the future and instead want to go back to the insurer who would put this right again. I have been told this week that "it is not insurers obligation to reinstate and the contractual relationship is between the contractor and the insured party" which sounds like the insurer is not interested if there are any future issues. Does this sound right? It is not how I understood things but I may have misunderstood. And does the mode of payment have any bearing on this position? Thanks very much.

It is the contractor you need to take up any issues with. It is classed as subcontracting, and the contractor should have their own insurance. You can of course ask to see their insurance documents before work commences.

And what happens if the contractor goes bust the day after he does the work? Why should I take the risk of a contractor chosen by the insurer?

The contractor will still have valid insurance even if they go bust. You could always ask the insurer if you can get your own contractor but you are likely to be at a much higher risk of such a company doing shoddy work or going under. Insurance companies don't work with any old contractor they pluck from the yellow pages.

My insurer (very big and expensive) has no recommended contractors and you have to source your own. I have done this but I do not see why the risk something subsequently goes wrong is mine - the insurer ultimately chose the contractor who quoted the cheapest price and whose price then got further decreased. I have no idea how competent his work will ultimately turn out to be.