Janina got in touch with us when her insurer wouldn't pay on her claim. This was after she had taken their advice on using an online valuation calculator.
When Janina needed to renew her home insurance, her insurer told her that they had changed their underwriting policies. Janina had unlimited cover before the change, but now she needed to provide a valuation for her home.
Her insurer told her to use an online valuation calculator. This was on a different company's website.
Janina wanted to make sure she got everything right for the valuation. So she went around each room noting down as many details as possible, as well as using a tape measure to double check the size of each room.
When she had everything together, Janina went online and used the online calculator. She did the valuation, and everything went smoothly, and Janina felt confident that her home was fully insured.
A few months later, Janina's house suffered major damage because of a burst pipe. So she called her insurer to make a claim.
The insurer's loss adjuster visited the house to assess the damage. But when the report was together, the adjuster realised that the house was drastically underinsured. They thought that it was only about half of its true value.
When the insurer got the report back, they decided to pay the claim proportionately, because of the underinsurance. Janina came to us because she felt that as she'd used the calculator the insurer suggested, she should be fully insured.
What we said
We quickly identified the problem. When Janina used the calculator, she said that her house had four bedrooms. So the valuation she gave the insurer was based on this. But according to the adjuster, Janina's home actually had six bedrooms in its original design.
Janina explained that she hadn't bought the house from new. She vaguely remembered the house was advertised as possibly having six bedrooms, but she had never used it that way.
When we saw the report, it showed that there was a fully-fitted study and a games room where the two bedrooms may have been before. Janina told us that she used three bedrooms - one for her and for each of her children - and the fourth bedroom was a guest bedroom.
The insurer had clearly advised Janina to use this particular calculator, and there was no evidence to suggest she had been dishonest in her application.
We believed that before advising Janina to use the calculator, the insurer should have checked a few more details with Janina. At the very least, they should have clarified about calculating the number of bedrooms. Because the fault was the insurer's, we decided it was unfair to reduce the payment for underinsurance.
We told the insurer to pay Janina the difference from what she's received and what she would have got with the full insurance.