Home insurance provides peace of mind and is hopefully something you never have to use. But when an issue does arise you want to be sure your claim will be accepted. The bottom line is that if you have a genuine claim and it is within the terms of your insurance policy a claim will be accepted.
However, there are a number of reasons why an insurer may not pay out, or only pay out part of the amount you’ve claimed for. This month, we explore those reasons, so you can be sure you’re not caught out should the worst happen…
Remember: If you’re not satisfied by the reasons given by your insurance company for rejecting your claim, you have a right to complain.
Ensure ALL of the information the insurer holds about you is accurate.
In order to provide you with a policy your insurer will ask a number of questions to determine the level of cover provided and the risk they are willing to take on. An insurer can choose to reject your claim, or not pay it in full, if you didn’t answer all questions on your home insurance application correctly.
You are responsible for the information provided to the insurer so when completing an insurance application, over the phone or online, it’s vital you are honest about the property, location and any personal details to ensure any claims are accepted.
The insurer believes you didn’t take ‘reasonable care’
As the policy holder you are responsible for taking ‘reasonable care’ this means you must take certain steps to prevent a situation that may cause a claim. For example, if you were burgled but the thief gained access through a window or door you left open, you may find your insurer will contest or reject your claim, as you could have taken steps to avoid this happening. If force or violence was used to access the home the chances of a claim being rejected is unlikely.
The reason for the claim is excluded from your cover
Each policy will clearly specify exactly what is and is not covered, and other specific rules relating to your policy. Your insurer may use these exclusions to challenge your claim; for example, if your property is damaged as of the result of a storm, the insurer may pay out to damage caused to your roof but may exclude damage to fences and gates.
Before accepting a policy make sure you have read and understood the terms of your insurance, you can find out what is and isn’t covered within the insurance product information document (IPID) which aims to provide clearer information to help customers make an informed decision.
If you are ever unsure of any of the terms, speak to your broker or insurer prior to arranging cover. Doing this before taking out cover will prevent any unwanted surprises should you need to claim.
The correct claims process wasn’t followed
All insurers will have a specific process they expect customers to follow, this will detail things such as the time frames in which you need to notify the insurer of a potential claim.
If this process isn’t followed exactly how they’d expect, they may use this as justification to reject your claim. Be sure to familiarise yourself with what this process is when taking out your policy, and follow the guidelines if you need to make a claim.
What to do if your home insurance claim has been rejected
If your claim is rejected, your provider will be required to state their reasonings. Your first step should be to check your policy to see if the reasons they’ve given match up with the agreement you both made when you took out the policy. You can challenge the rejection if you feel it was unfairly rejected.
- Check that you filled our your policy application with the correct information
- Make a note of the exact wording used in your policy, and understand exactly what you’re covered for. If you feel the wording they have used isn’t clear, make a note of that as your insurer is required to provide you with clear information.
- Similarly, if they are not clear why they are rejecting your claim, this can be used to challenge the rejected claim.
- New rules state that insurers cannot reject your claim if you took reasonable care to answer all questions honestly and to the best of your knowledge. If your insurer didn’t ask for information that they now say you should have disclosed, note that down too.
- Find and save any other correspondence you’ve had with your insurers. This may be a change in circumstance, which you are responsible for.
Use the Financial Ombudsman Service
If you’ve been through your insurer’s complaints process and still aren’t happy with the result, you have a right to make a complaint to the Financial Ombudsman Service, an independent and free-to-use service that investigates complaints made by customers against financial businesses.
You can only bring a complaint to them when you’ve had a ‘final response’ from your insurers, or if 8 weeks have passed and you haven’t had a response from them. If they assess your situation and come to the decision that your claim was wrongly rejected, they have the power to make your insurers:
- Explain their actions
- Apologise
- Pay compensation/take appropriate steps to change the outcome
We hope you’ve found this article useful in the steps you need to take if your home insurance claim has been rejected. For further advice, or to speak to someone about home, buy to let or business insurance, visit our website.
