Insurer says it’s not liable for preventative work – our investigation found otherwise

Insurance Subsidence Buildings insurance

When a customer put in a claim for subsidence damage, he was surprised that it was turned down. We stepped in to resolve the disagreement over the policy definition of ‘stabilisation’.

What happened

The insurer agreed that subsidence was the cause of the damage Christopher claimed for under his buildings policy. However, it refused to pay for any stabilisation work. Christopher felt this work was essential to put matters right and prevent future problems.

The report prepared by the insurer's engineers stated that minor movement would probably continue unless the foundations of the house were stabilised. The insurer said it would pay for any superstructure repairs and redecoration that might be necessary, as and when further movement occurred.

But it argued that stabilisation wasn’t strictly part of its liability, since its policy only covered the cost of repairs. It considered stabilisation to be 'preventative, not restorative'. After complaining unsuccessfully to the firm, Christopher came to us.

How we helped

We listened to both sides of the story. We considered the insurer's contractual obligation under the terms of its policy. As is usually the case, the insurer was obliged to repair or pay the cost of repairing the damage.

In our view, the proper repair of a building requires something more long-lasting than a temporary patch-up. Filling cracks and repainting can’t be regarded as repairing subsidence damage if, within a relatively short time, the cracks are likely to reappear.

Putting things right

The expert evidence indicated that, without stabilisation, the movement that had caused the damage would continue. We asked the insurer to meet the cost of stabilisation.