Many home insurance policy holders in the UK, own an insurance policy that that will simply not pay out, if and when a claim arises.
Of course, for the large majority of policy holders, their problem will remain hidden, because if they don’t make a claim, they will never know!
“It doesn’t matter, until it matters”, comes immediately to mind.
However, for those unlucky enough to have their claims rejected, due to a negligent non disclosure of information, or inadvertent breach of a material condition, it can matter a great deal.
This unfortunate situation seems to be on the rise. However the hard truth is that the insurance companies are not the bad boys in this debacle.
Insurance claims being rejected, are often sensationalised on “Rip Off” type TV shows. You know, the poor little family, with financial difficulties, that had paid the home insurance premium for ten years, only to have a claim rejected by their insurer.
When you look behind the sensationalist nonsense, the problem is that people are not taking advice. They tend to be focused on the lowest price they can find on a comparison site.
Contracts of insurance are carefully drafted legal documents. They contain terms, conditions, and exclusions, and quite clearly define the rights and obligations of the parties. Simply put, without terms and conditions, the home insurance products would have no value. However, most people don’t read the contract through, or if they misinterpret the meaning of the content.
Insurance, for properties to be used as Holiday Lets, can often present much more of an issue as they are commercial in nature.
There is a cruel deception here, for the unwary customer, in that as most holiday let property homeowners, also own their own home; they think that they know all there is to know about home insurance!!
As a holiday property is classed as a business, the policy required must, in addition to buildings and contents cover, include, Employers Liability and Public Liability elements. The policy will include far more conditions and potentially onerous conditions, which must be complied with, in order to ensure that the cover is valid.
Here are just a few points that we picked up on by reading through a few holiday let insurance policies. The list is by no means exhaustive!
- What are the conditions written into the policy, should your Holiday Let property be unoccupied for a period of time? In the case of the policies that we looked at, the periods varied considerably, and the terms quite onerous
- Have you thought about whether the policy covers both Theft & Malicious Damage by guests? Some we looked at did cover this situation; others did not, or were a little vague
- Do you know, or have you thought about, whether your policy covers the costs of alternative accommodation, for you guests, should the property be damaged before or during their stay?
- Does your policy provide cover, if one of your guests is under the influence of alcohol, falls into your empty swimming pool, which was drained by the guest, in order to prevent a potential drowning hazard to their young children
- What are the conditions in the contract, relating to damage caused to your property, by third party cleaning contractors?
- How is the policy worded, in terms of public liability, for injury to person or damage to adjoining property; caused by your guests?