Other Responsibility for expenses following the acceptance of liability

Discussion in 'Insurance not covered in other forums' started by tecate, Mar 3, 2017.

  1. tecate

    tecate Registered User

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    I have investigated an issue, engaged an engineer, commissioned an engineers report - together with invasive testing/investigation works.

    The upshot of all of that was that the insurer (structural insurance on a residential property as opposed to 'home' insurance) accepted liability. Matters have since proceeded to a point where the insurer has proposed repairs. Agreement on the terms of same have stalled. The insurer is insisting upon the involvement of an engineer from my end. However, they maintain that they are not obliged to cover my expenses in this regard.

    My contention is that I have proven my claim - they have accepted liability - so we are no longer in the claim investigation or preparation phase. The contract/policy document states that the insurer covers engineering consultancy and other fees reasonably incurred ...."but shall not include costs or fees incurred by the Policyholder in investigating and/or preparing a claim".

    Is it reasonable to insist that the insurer picks up the tab for any such expenses that are related to reparation works from this point forward? I accept that I will remain out of pocket for fees incurred in the initial preparation/investigation of my claim - but I contest any suggestion that I am obliged to cover costs that involve technical discussion of repairs suggested as a result of their liability.


     
  2. DirectDevil

    DirectDevil Frequent Poster

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    This area of the jungle is a little bit off my beaten track. However, a few general thoughts might help......

    It strikes me, on a superficial reading of the contract terms you quoted, that the insurer may be having it both ways.

    I think that the question to be put back to the insurers is to ask at what point does the engineer's work in preparing a claim end and become the engineer's work whose involvement is at their insistence ? What exactly do they want the insisted involvement of your engineer to achieve ?

    Additionally, I would have thought that the engineer's involvement at this stage would be analogous to an architect's fees for work he does in aiding a client whose house has to undergo repair or reinstatement i.e. his involvement is a necessarily integral element of the repair process which is the subject of indemnity under the policy. I would argue this analogy and distinction in relation to your engineer.

    As a general rule, if there is ambiguity in an insurance contract that should be construed against insurers on the contra proferentem rule. This rule provides that the party who wrote a contract will have any ambiguity in it construed against them. I am not sure of the full details of this specific type of contract but I would argue the point with the insurers if their demand sits in contradiction with what the contract wording appears to say.

    As a piece of general prejudice on my part I might observe that I have encountered an odd problem with insurers who seem to like to create exotic unilateral constructions of their own contracts so don't be put off too easily by them.

    Finally, if you get no change from the insurers I would consider a few options ;

    1. Consider engaging a loss adjuster. I am thinking along the lines of the conventional loss adjusters where the individual practioners are associates of the Charted Institute of Loss Adjusters (ACILA) at least. This might be someone like McLarens, GAB Robins Scully Tyrrell, Thorntons or the like. BTW I have absolutely no connection with these chaps or their profession.

    Whether you might want to bother would be driven primarily by costs i.e. would the costs of a loss adjuster be worth it. However, you can always talk to them to see what services they might have to offer for your situation.

    2. Many policies contain an arbitration clause that ousts the jurisdiction of the courts i.e. you may have to arbitrate any dispute by use of that method. Again, there are costs implications with arbitration.

    3. If the insurers are subject to the jurisdiction of the Financial Services Ombudsman's Bureau you could make a complaint to them. Beware though that whilst it costs nothing to make a complaint any adjudication is legally binding on the parties. Link https://www.financialombudsman.ie/. There is a right of appeal but it lies to the High Court and that involves heavy costs as well as potential exposure to other parties costs which is why people should not go there unless the amount at stake is very large.

    Food for thought. Hope it helps. Best of luck.....
     
  3. tecate

    tecate Registered User

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    Thank you for taking the time out for such a detailed response. It's very much appreciated.


    Just an update on this....


    As expected, their initial reaction is to suggest that their engineers are the only ones that are required (I've cited this as being prejudicial). I've countered by saying that they do NOT represent my interests.

    Interestingly, they didn't tackle my direct response to this statement from them/the policy document;

    "but shall not include costs or fees incurred by the Policyholder in investigating and/or preparing a claim".

    Lets see what they come back with - second time round.
     
    DirectDevil likes this.
  4. tecate

    tecate Registered User

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    Last edited: Mar 12, 2017
    They have shifted position - no longer challenging my right to claim costs re. investigation/preparing a claim since I challenged that and clarified that we've left that stage of the process behind. Now it's a case of them suggesting that the insurer has the right to choose the method of indemnity and that doesn't include the provision of a 2nd engineer - quoting a section of the policy that states the following;

    "Such architects', Surveryors', Legal, Consulting Engineers and other fees as are necessarily and reasonably incurred, by the Policyholder in relation to the complete or partial rebuilding or rectifying work to the Housing Unit."


    Once again, I'm challenging this on the basis of fees that are 'necessarily and reasonably incurred' - given that they wouldn't answer my queries - but only answer same to an engineer representing me, wouldn't progress matters without a site meeting involving an engineer representing me - and during said meeting, asked my permission for the right to directly discuss with my engineer in order to finalise outstanding points of difference. Furthermore, the engineers selected were selected by them and not me - I had no input ref. same. They are answerable at all times to them and not me....ergo all the evidence suggests they act for the insurer and most definitely not for me (the policyholder). I can't possibly see how the wording of the policy supports them given their actions but lets see what they come back with.

    With regard to your suggestions on how to proceed DirectDevil, thank you in the first instance for elaborating on same. In terms of a loss adjuster, in hindsight - perhaps I should have gone down this route from the outset. However, I've taken the matter into my own hands and whilst incredibly slow, I've been making headway - so at this point, I'll stay the course in managing it myself. That said, for anyone reading in a similar position - this option is worthy of consideration. Having spoken to many people in the industry in between times, I've found out just how difficult it is to get a result with this form of insurer in Ireland.

    Upon reading through the policy, there doesn't seem to be an arbitration clause. In terms of the Financial Services Ombudsman, I've made several complaints during the process over the past 2 years - each time they 'investigate' internally and then inform me of my rights ref. FSO. I've called them on one of these items - given them the opportunity to finally deal with same - and they relented in the end. Notwithstanding that, I'm conscious of the fact that I can't get side-tracked and need to keep the process as a whole moving....ergo, I wouldn't/will not discount the option of going to the FSO but I believe you have to pick and choose which items you take to them.
    Otherwise, like I believed from the outset, it looks like the only way to get satisfaction is full legal recourse. I've always been prepared to go this route albeit that I wanted to exhaust every avenue in resolving directly - being seen to give them every opportunity to do the right thing. In doing so, through their actions, my case has been strengthened.

    There's very little feedback out there ref. people dealing with this type of insurer in Ireland. When this matter has finalised, I intend to write what I hope to be a key post from the perspective of an ordinary joe - with regard to the difficulties and pitfalls of dealing with these guys - and ultimately getting satisfaction from a product that was paid for in good faith and for which, it's as clear as day as to their responsibility to make good on same.
     
    Last edited: Mar 12, 2017
  5. Ravima

    Ravima Frequent Poster

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    Is it not a case where:

    (a) they do NOT cover the cost of engineer PREPARING the claim,

    but

    (b) they will cover the supervision costs of the works to be done?

    this is standard in all home insurance policies.

    if there is NO arbitration condition, which is not uncommon, but rare, then you can go direct to High Court for direction/decision. Be aware though, the costs of this procedure are horrendous and you will need very deep pockets indeed, if are on the losing side!
     
    tecate likes this.
  6. tecate

    tecate Registered User

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    Last edited: Mar 14, 2017
    Thanks for posting Ravima.
    I have no issue with (a) - and have discharged my responsibilities in that respect. (b) *may* also be correct in principal. However, the issue I have here is that they want to get in and out and do the cheapest job possible (to my detriment). They have contracted the engineers to propose a remediation plan - and to oversee the works. I have not been given any input into whom was selected. Furthermore, as part of the exchanges that have occurred to date, they keep insisting that their engineers are 'independent' when they carry out practically all such works for the insurer throughout Ireland on an ongoing basis. They are paid directly by the insurer. During the course of events, they refused to answer my queries and said they would only provide answers to an engineer acting on my behalf. Furthermore, they insisted on a site meeting - provided I had an engineer attend who represented me on the matter. Lastly, they asked to have direct contact with my engineer going forward to finalise the scope of works. Surely the wording of the policy can be interpreted as such that they are obliged to cover these costs? =>
    "Such architects', Surveryors', Legal, Consulting Engineers and other fees as are necessarily and reasonably incurred, by the Policyholder in relation to the complete or partial rebuilding or rectifying work to the Housing Unit."
    Am I not entitled to avail of the services of an engineer and is this not necessarily and reasonably incurred (particularly given that said engineer doesn't agree with the insurer or their engineers on a number of items proposed as part of their remediation plan?

    In theory it sounds the same as set out in this structural (as opposed to home) insurance policy - save for what I've articulated above and the wording of the policy (above) in relation to fees.
    I have had some initial advice on the matter. I'll have to think a bit harder before committing to going this route (and of course, it depends on the insurer...albeit they have a plethora of cases in the courts - they play hard ball). That said, I'd imagine this should be a circuit court case as opposed to High Court (given that the threshold has been raised to €75k). Still an expensive route to take if things go south - but not to the same extent as High Court.
     
    Last edited: Mar 14, 2017
  7. Ravima

    Ravima Frequent Poster

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    I'm going to be brutally frank here.

    In my opinion, you need to step back a bit. If the insurers are undertaking to do the repairs, with your engineer supervising - what's the problem?

    Are you getting too involved with details of the policy wordings and not seeing the bigger picture of getting the damage fixed?

    Can you talk with your engineer, that s/he can try to agree his fee as a supervising fee, which is covered?

    All seem to want to resolve the problem.
     
    tecate likes this.
  8. tecate

    tecate Registered User

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    Firstly, thanks for taking the time out to respond - and no problem ref. being frank - that's what I'd prefer - I don't need anything sugar-coated.

    Some background info. It's taken 2 years to get them to this point. The irony is that 2 years ago I would have settled for a lot less remediation work (as my claim was submitted on the basis of non-invasive investigation/engineers report). My engineer suggested a fix - but they rejected the claim outright (despite render being described in the policy document as being a structural element - and an admission that there was render failure - they rejected the claim on the basis that I had not proven how water had ingressed from the outer leaf to the inner leaf and internal surface of the wall (inside the dwelling).
    Roll on stage 2 - I had to get a builder to cut a couple of sections out of the external wall of the house - and prove that the bonded bead insulation was saturated and that it was carrying the moisture across. In the meantime, cracks started to develop on 2 other walls of the dwelling.

    They then accepted liability - and proposed a remediation plan through THEIR engineers. I counter-proposed - but they rejected my counter proposal. I raised a series of queries on their remediation plan and they either failed to answer them or their was conflict in light of the same. More recently that has culminated in a site meeting between myself, the insurer and the respective engineers (theirs and mine). Some items were agreed upon - some items remain a source of conflict.
    They maintain that they paid for my engineer to be there (at the meeting) as a courtesy. However, they were that mean, that they tried to renege on paying part of that bill (that argument has ran it's course and they've relented).
    Their proposal is that their engineers put together the remediation plan and supervise the works. They will not accept that my engineers costs have to be covered. I've outlined to them that their engineers (who work for them on an ongoing basis) are not independent but they vehemently dispute this. I won't accept this as what they've been proposing is a solution that they can get in and repair and get out - as fast as practically possible for as little expenditure as possible - but the important part - to my detriment. Furthermore, they won't offer a proper warranty on the works they have agreed to undertake.

    My engineer has experience of this insurer. He told me that they are brutal to deal with - and that he has had clients that have simply got nowhere with them. Now, I don't want you to feel insulted. I know you work in the industry. I have had dealings with both home and car insurers in the past - without any issue whatsoever. This is a structural insurer and they are a very different animal!



    I'm very much involved. The amount of correspondence that has passed each way has been horrendous. However, it's for good reason. I'm not going to accept an inequitable solution to a loss suffered that was not of my making and which to my mind is covered under the contract/policy document.
    The latest point of conflict is that they maintain that they are not responsible for the costs of my engineer going forward. I accepted (as per the policy) the costs required to investigate and prepare my claim. However, it's my contention (as per the reading of the policy document) that now that they have accepted liability, I am no longer on the hook for those costs. They have then said - fine, we don't need to liaise with your engineer but our 'independent' engineer will oversee matters. That's not equitable given that they don't have my best interests at heart.


    If they agree to cover the cost of my engineers involvement - and relent on a couple of other matters, we're home and dry. However, given the vile, contemptible way I've been treated, I'm not for turning on this. Trust has long since been lost in this process - and I will pursue this through the courts if necessary.

    Their engineers mandate is to get in and get out for the smallest investment possible. With that, the insurer is telling me that I have no recourse directly to them in the event that I face a similar loss due to the failure of the specific works that they have carried out (i'm not talking about a full renewal of the policy - just cover in the event that the work that's carried out is not up to standard).
     
  9. Ravima

    Ravima Frequent Poster

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    Noted.

    Good luck in your quest, I hope you get the resolution you want.
     
    tecate likes this.
  10. tecate

    tecate Registered User

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    Thank you, Ravima. It looks like at the very least I'll be putting the 'independence' of their engineers to the legal test. Either I'll be on the hook for that or if not, then I'll also be challenging another aspect of matters (that's currently a point of conflict between my engineer and theirs).

    Regardless of the outcome, I'll be posting my findings online. My whole estate is affected with the very same damage yet (I'm pretty sure), I'm the only one to take them to task for it.....and I understand why. They're damned adversarial to deal with (I'm talking about structural insurers - not motor or home insurers - so not insulting you....I *think*?).

    There's very little information out there as regards how to tackle these guys. They've motivated me to address that.