Deluge of flood claims rejected

REGULAR readers of this column will know that I always say: “If an insurer can wriggle out of a claim, it will.”

This is precisely what many homeowners with flood claims have been experiencing.

In most cases, the reason given by the insurer is: “There has been no flood.”

Grace from Leamington Spa, Warks, lives in a basement flat and her story is becoming a common one. She claimed on her home insurance for damp on the walls and water leaking through parts of the floor.

Convenient

The insurer sent out a specialist to inspect Grace’s property and he concluded that the water was coming in from rising water tables under the foundations.

The insurer then told Grace that as no pipes had burst and the water had not come from heavy rainfall, it was not classed as a flood and therefore denied her claim.

Many home insurance policies fail to define “a flood”. This is, of course, very convenient as it means the insurer can decide what constitutes a flood on a case-bycase basis.

Many conclude that there must have been a sudden or violent event, such as a burst pipe, heavy rainfall or burst river banks. This means that floods caused by a slow build-up of water, as in Grace’s case, are excluded – and this is why so many insurance claims are being rejected.

When you have an unresolved dispute with an insurer, your next steps is to file a claim with the Financial Ombudsman Service (FOS). You have to give your insurer at least eight weeks to investigate your complaint and respond before taking this step.

But the good news is that the FOS is responding to many complaints in favour of the consumer.

Its position is that a flood doesn’t have to be a sudden or violent event. It can occur when water enters – or builds up – in a property slowly and steadily, and this does not necessarily have to be caused by a natural event.

The key factor is that water had built up, regardless of where the water came from.