Subsidence: are you covered?

A property owner recently discovered how home insurance can be a minefield as far as subsidence is concerned. Her insurance company has refused to pay out on her claim, as it believes she failed to disclose vital details when she took out the policy.The owner bought a buy-to-let property in Staffordshire last year and it sailed through a mortgage valuation. There was nothing to suggest a problem with subsidence: the valuation did mention historic subsidence in the area but stated it was unlikely to affect her property.

The property then started to develop cracks and part of the living room floor caved in. Her insurer sent out a surveyor – and, to her horror, then rejected her claim citing “non-disclosure of subsidence issues”. It stated that she had failed to tell them the property was “situated in an area that is prone to subsidence”.

According to the Subsidence Claims Advisory Bureau, a Law Society list of postcodes affected by subsidence is widely used by solicitors when they carry out a search. And the Association of British Insurers (ABI) says it is unaware of insurers rejecting claims on the basis of customers failing to supply data relating to their property’s postcode. But the insurer still refuses to accept her claim. The property owner may now take her case to the Financial Ombudsman.

Morgan Clark has helped many customers whose property has been affected by subsidence. Read more about our subsidence insurance claims services and how we have successfully negotiated subsidence claims for some of our clients.