Insurance company applying new stricter standards to policy

gh0676

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Hi,

I don't want to give away too much detail in relation to my dispute but would appreciate any feedback.

I am currently in a 4 year dispute with an insurance company in relation to damage to my property.

When my policy was taken out,the policy document was very general in nature and structural damage requirements were open to interpretation.

10 years later my policy has now expired and the insurance company is refusing my claim. They are applying new strict damage guidelines that they have formulated. They now believe these new stricter guidelines should also apply to my policy. They argue that their new detailed guidelines have become accepted as a recognisable standards in the industry.

These new guidelines were only introduced in the final year of my policy and did not even exist for the first 9 years of the policy,therefore I am arguing that the insurance company should not be applying these new stricter limits to my policy as they were not in existence when I took out my policy.


Can anybody advise if an insurance company can apply new detailed criteria to a policy years after the policy has been taken out?
 
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Your post is somewhat vague, but I would imagine that the policy contract (if that or part of it it is what is in dispute) cannot be amended retrospectively. In the event of an impasse it should be brought to the Ombudsman.
 
Thank you for your post, my case is currently with the Ombudsman, and I am currently working on building my case.
Your post is somewhat vague, but I would imagine that the policy contract (if that or part of it it is what is in dispute) cannot be amended retrospectively. In the event of an impasse it should be brought to the Ombudsman.
 
you should probably make it clear that is a 10 year homebond or structural guarantee policy you are talking about as its a little different to a yearly household policy.
 
I can confirm I am referring to a 10 year structural guarantee policy (this was included when I purchased the house and the policy is non renewable.
 
The exact query is not clear from the original post so these are just general views.

There seem to be two separate questions; the claim and the policy terms.

CLAIM.

In relation to the claim it seems that the dispute turns on a matter of interpretation. If there is ambiguity in the contract wording that should be resolved in your favour. This is based on a principle known as the contra proferentem rule. In short, the contra proferentem rule provides that contractual ambiguities [in terms of the wording] are construed against the party that drafted the document. In this case the rule should apply against the insurer if you can establish the ambiguity on the facts.

By the way, many insurance contracts provide, or even mandate, that disputes should be resolved by arbitration. I am curious as to why the insurers did not insist on arbitration.

In relation to the F.S.O.B. be sure that you have registered the contra proferentem argument with them. If not, you might supplement your submission accordingly.

POLICY TERMS.

As far as the second issue of restrictive cover goes it must be remembered that most insurance contracts are only annual contracts. Although you retain the same policy number and so on the contract is only an annual one. In other words each renewal is a new contract. That is how insurance underwriters can vary their terms and conditions from year to year.

I see that your policy has expired.

Please be aware that if you have taken out insurance with a new company the facts that you have had a claim repudiated and restrictive terms imposed on you constitute material facts and those matters should be disclosed to your new insurers at proposal stage. Failure to do so could constitute non-disclosure of material facts and lead to your policy being voided. If you were unlucky to have a claim with a new insurer it could be avoided for the same reason.

For technical interest, a material fact is one that could influence a prudent insurance underwriter in deciding whether or not to accept a risk proposed for insurance and if so upon what terms and conditions.
 
Since posting above I now see the additional information that it is a guarantee policy so some different rules may apply. Hopefully, you can mine something out of the general principles I mentioned.
 
Many Thanks Direct Devil, your post is extremely helpful to me, the contra proferentem rule is something I will definitely explore

Since posting above I now see the additional information that it is a guarantee policy so some different rules may apply. Hopefully, you can mine something out of the general principles I mentioned.
 
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