About 20% of home insurance claims get kicked to the kerb every single year in the UK. Compared to car and travel insurance, home insurance claims are, by far, the most likely to be rejected out of the three. This is why it’s best to know the score before having to make a claim. Knowing what your property insurance policy will cover and how the process works are both key to getting your claim approved and the compensation you need. Knowledge is power and this guide will help you be prepared should you need to file a claim.
Before you claim
The first thing you do when you claim largely depends on what actually happened. Insurance companies will have different steps depending on why you’re claiming. Let’s see how you can best handle different claim situations.
1. Theft, Burglary, Robbery and Vandalism
When any of the above crimes are the cause for your claim, you must report what happened to the police first and foremost. By doing so, you will initiate the forensics process and you will also get a crime reference number pointing to your police report, that your insurer will need.
Burglary, theft and robbery - What are the differences?Theft occurs when property is stolen without breaking in. Meanwhile, robbery happens when the thief uses force or the threat of violence to steal property. Finally, burglary occurs when a person trespasses into private property with the intention of stealing property, such as going into a shed where garden tools are stored.
2. Damage or loss
Your first port of call if belongings go missing (but you don’t suspect theft at the outset) or if something in your home (or the dwelling itself, such as a flood) is damaged is to check your home insurance policy wording that comes with the welcome documents insurers send you after signing up.
With that information, you will be able to find your policy number and the phone number to make a claim.
If the claims helpline is a 0845 or 0870 number, you should ask the insurance agent to return the call promptly.
The next step is to have your evidence ready to bolster your claim to increase the chances of it being approved.
How to get the evidence you need
1. Receipt / Proof of purchase
Being able to provide receipts or some other form of proof of purchase is essential to any contents insurance claim. If you cannot find specific receipts, then you should look for bank statements for debit or credit cards, since these will do in a pinch.
If you cannot access the bank statements for the time frame when you made the relevant purchases then you should be able to retrieve them from your bank who will have a full record of your transactions.
Another possible alternative would be to find any shipping notifications or online order information if you bought the insured items online. It helps to keep track of these alongside your home inventory which will help you when a claims adjuster reviews your case.
When it comes to claims involving damage, photos are valuable as evidence. For this reason, they are a good addition to any claim submission whether you are filing online or by sending them by mail or fax. A picture tells a thousand words and this could not be more relevant than with spills, breaks, floods, fires or any other disaster.
3. Detailed descriptions
Always keep in mind that more documentation means fewer questions from your insurer. When filling out forms, you should always make sure to complete all the relevant sections about personal property.
With anything that requires a longer response, you should take the time to write a full account. Taking shortcuts with the forms will only mean that your claim will be triaged and slowed down because the insurance company will have reach out for the details you missed.
With all kinds of insurance, the burden of proof is on you, the policyholder and making a claim. Insurance companies try to narrow the number of situations where they have to pay out for a claim, through exclusion clauses, to limit overall risks and exposure not just to what life throws at us but also fraud.
How insurance companies work with incoming claims
More significant home insurance claims will generally lead to a loss adjuster or investigator coming to the home of the policyholder. Their job is to assess the damage or loss and to determine the repair or replacement cost that the insurance company will be willing to pay.
If your claim is accurate and you provided the necessary documentation, then your claim should be validated without any further issue.
However, if your policy was not extensive enough to cover the claim or you did something to compromise your insurance coverage then your claim could very well be denied and, in some cases, you could lose future cover.
Knowing the reasons why an insurer denies claims or cover is the key to a successful claim. These reasons are exhaustively listed in your insurance policy as either limits, exclusions or invalidations.
Policy limits, Exclusions and Excess
Every tenant or homeowner needs to know about the limits and exclusions of their policy so they are not caught out by surprise.
1. Limits to your insurance cover
Insurance companies generally apply different limits depending on the category of claim. Additionally, some categories, like valuables or bicycles, have an individual item limit in addition to the overall limit.
This means, for example, if you have a category limit of £10,000 for jewellery, there is likely to be a be single item limit of £2,000. A claim that only relates to one item of jewellery would only be covered up to £2,000 even if that single piece of jewellery you insure is worth more.
2. Exclusions: the devil is in the details
You should make sure you are aware of all the possible exclusions your insurer could you use to excuse themselves from paying out your claim.
Here are the most common ones, including some you may not be expecting:
- Infestations: We’re not talking zombies here but rather rodents and insects. Any damage done by the little critters that can be pinned to a current claim will be used as a get out of paying card by insurance companies. Being proactive about pest control really does pay off.
- DIY nightmares: If you put a nail through a gas pipe and cause a fire, your insurer may nominate you for a Darwin Award but they may not pay out when it comes to sorting the mess.
- Accidental damage can be covered by insurers but they rarely do so as standard. For this reason, it’s worth paying a little more and being covered even when you put a hammer through a wall.
- Not including home improvements: Similarly, your insurance company will want to know if you modify your property because it has an impact on your home cover. This includes building an extension, greenhouse or shed. Just like with most things, letting your insurance company know before you embark on a major project is a given so that you’re on the safe side.
- Subletting your home with Airbnb: Most insurers will deny your claim quicker than you can list your home for a cheeky sublet if they find that you put your home up on websites like Airbnb.
This is because homeowners insurance, unlike some tenants insurance, is designed to cover homes where the people occupying them do not change. Once you introduce strangers into the mix, insurance companies view that as an exponential increase in risk for them.
If you plan to have your home available for sublets, you should contact your insurer to see what their stance is on guest liability. Better to be safe than sorry when it comes to having people stay in your home.
- Letting your home fall into disrepair: If your home is not in tip-top shape, especially during winter, and catastrophe strikes the insurance company may get out of paying by citing disrepair as a contributing factor to the mishap.
- Being away from home for too long: Most homeowners insurance policies are fine with people being away continuously for 30 days. However, if you exceed a month out of the house, you may find your claim denied because it’s viewed as a breach of conditions.
If you need to be away for longer, you must contact your insurance provider so that they can advise you. In most cases, they can extend coverage for a small fee, often for up to 60 days.
3. The excess comes out of your pocket
With most insurance policies, a successful claim means that you will have to cover a pre-agreed amount before getting any claim payout. Generally, excess amounts are anywhere between £100 and £500. Some insurance will apply a blanket excess to most claims while others may vary excess amounts depending on why you are claiming.
In any case, you need to make sure you can pay the excess at all times. If your financial circumstances change you should be ready to lower the excess amount to a realistic level for you.