Home Witheld previous claim from Insurance company

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Hi all,

have a qucik question regarding insurance policies. My mum recently moved home insurance policies to Zurich. She's not very good with paperwork, small print and all that. When filling out all the detail for her new policy she neglected to mention that she had a previous claim from a previous policy about 5 years ago due to a burst pipe. The damage and payout came to about 500 euro. However she recently had a house fire that caused lots of damage (approx 10K) but because of her witheld information the insurance company are stalling an making sounds like they wont pay out. Does anyone have any info or know if she has any comeback on this?
 
Two words - uberrima fides...

http://en.wikipedia.org/wiki/Uberrima_fides

The insurance company may be well within their rights not to pay out.

See what happens - if they refuse then try to query/challenge the decision. You might be able to take the issue to the Ombudsman if they refuse but I doubt that he'll be able to do much.
 
Its a non-disclosure of a material fact which means is sufficient grounds to decline the claim. Its not really small print, if she applied online its quite apparent on their website that the claim would have to be declared. Same with a paper proposal form, its quite apparent.

Cant see you having any comeback. And you won't get anywhere with the Ombudsman.
 
I'm going to disagree with the others and say you should go to the Ombudsman and I would be hopeful for some sort of a result (50% claim coverage or better).

Unless the insurer can show that disclosing the €500 water damage claim would have caused them to decline cover or increase the premium by a large multiple (not a percentage), I don't see how they can argue she is not covered for at least some of her fire damage. Also, if she is over-insured (quite common where the buildings cost has been automatically increased every year rather than assessed against current rebuild costs) the premium she was paying may have been too high anyway.

At the very least if the insurer says that you aren't covered, they should refund the premiums paid since she switched to them, since in effect they are saying the contract is null and void!

Note I know very little about the legalities of insurance so I could be completely wrong about this!
 
first of all if someone is to make a complaint to the Ombudsman, it first has to made in writing to the insurance company. If nothing is achieved from that route then you can go to the Ombudsman but not before.

Secondly they don't have to show that the water damage claim would caused a decline or increase in the premium. In the current climate they will likely cancel the policy ab initio.

This will all cause further problems down the road as a qualifying question for most insurers is "have you ever had a policy cancelled or special terms imposed" and going forward she will have to declare this here also.
 
Just to clarify - I wasn't advising the Ombudsman route other than as a very last resort as I too suspect that it would be a waste of time.
 
I would think with a claim that size, Zurich would have taken her on if she had disclosed the claim at inception. Based on that argument I would approach an independent assessor to handle the claim for her (if you're not already doing so). If the first claim didn't affect acceptance criteria or premium, I would think she would have a good chance of getting the claim paid.

www.powerinsurances.ie
 
'about' 5 years ago and 'about' €500.

You need to get full details before getting onto Zurich to make your case. You will need details of the date and the amount. Did the €500 include the insurance company assessor fee, or exclude it?

Who completed the proposal form and more importantly, who signed it? was it your mother, or was it some other family member. If the latter, then you have a further problem.

Are you sure that there is nothing else in the woodwork? If you make your case to Zurich based on the above, and they have something else on your mother, such as other claim(s), convictions, judgements it will not go great.

If there is nothing else, all you can do is to appeal to the good nature and charity of Zurich to overlook the strict non disclosure.
 
This type of thing is becoming more and more prevalent. Initially, as earlier outlined, an insurance policy is one of upmost good faith. Underwriters would determine whether to accept a risk on the basis of what had been disclosed to them or on what terms they would accept a risk. In the past, a previous claim of a few hundred euro or indeed a few thousand would not usually deter an underwriter from accepting a risk. However, in the current market, some Insurers stipulate that they will not take on any risks for which there has been a previous claim with the last number of years and the views of a prudent underwriter are not taken into account.

Regardless of how innocent or seemingly irrelevent the disclosure of a previous claim may be, many, if not most insurers will cancel a policy ab initio when the previous claim comes to light, if this has not been disclosed at inception. The issue of whether not the underwriter would have taken the risk had he/she been aware of the previous claim is not considered relevent and is generally not taken into account.

Some of these cases have been referred to the ombudsman for a ruling and he too has discounted whether a prudent underwriter would have taken the risk with the knowledge of a previous claim. The ombudsman has found that Insurers are within their rights to cancel a policy regardless of how trivial or irrelevent a non disclosed previous claim appeared to be. Some may say that relying upon this type of non disclosure aspect is verging on sharp practice, however, the Ombudsman does not agree, at least not in his ruling. I dont believe that this has been tested by the courts in Ireland in the recent past.

As regards the best approach, I do not believe that appointing a loss assessor will be of any benefit whatsoever in this instance. If anything, the appointment of a Loss Assessor may entrench Insurers in their position. Threatening the ombudsman at this stage will also likely entrench Insurers view, paticularly as they are no doubt comfortable in their position knowing of previous Ombudsmans decision and previous legal advise that they would have obtained.

In the event that there is a non disclosure issue, particularly of an apparently minor nature, I would strongly endorse the last line of Ravima post. In my experience of Zurich, they are not as zealous in their approach and I have seen cases where they have demonstrated a "good nature".
 
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