Tag Archives: when to call a loss assessor

Loss Assessors, Loss Adjusters and the Perils of Confusing Them

One of the problems we occasionally come up against is that people don’t understand the difference between a loss assessor and a loss adjuster. Now, this might seem like a trivial distinction for anyone who hasn’t gone through the process of making an insurance claim on their building or contents insurance. Those who have been through this, on the other hand, will realise that confusing them is a bit like confusing an accountant with a tax inspector.

A loss adjuster works for the insurance company you have your policy with, and it’s their job to make sure their employer doesn’t end up paying out money unnecessarily. A loss assessor like Allied Claims, on the other hand, works for claimants like you on a case-by-case basis. Our job, therefore, is to make sure you get every penny you’re entitled to.

That doesn’t mean, of course, that the loss adjuster is the bad guy, any more than the tax inspector is, or the opposing lawyer in a court case. They have an essential job to do and, in our experience, they normally do it professionally and ethically. At the same, however, it’s important to remember that the loss adjuster isn’t on your side. Your loss assessor is.

What Do Loss Assessors and Loss Adjusters Do?

If you have an insurance claim to make, both the loss assessor and the loss adjuster get involved early on. The difference is that the loss adjuster will be involved whether you like it or not, whereas you’ll have to engage the loss assessor yourself. And the time to do that is right away.

This is because a loss assessor can look at the claim you’re making and ensure that there are no errors in it that could give the loss adjuster a reason to reject or reduce the claim. The loss adjuster will look at what you’ve sent and ensure that it corresponds to what’s specified in your insurance policy. If it’s valid, they’ll accept it on principle — but that doesn’t mean your problems are over.

Because the loss adjuster is responsible to the insurance company, they’ll try to keep any pay-out as low as can be justified. This is where an expert loss assessor will really come into their own. Because they know as much about the insurance industry as the loss adjuster (if not more), they’ll be able to counter any invalid arguments the loss adjuster makes and ensure you get everything you’re entitled to.

That’s not all you get from a loss assessor, however. If they offer a full service, like Allied Claims, they’ll also arrange the quotes you need from contractors and project manage the work, saving you from having to constantly take time off work.

Most people wouldn’t face a court without their own lawyer, or tackle the taxman without an accountant — unless their affairs are very simple. Few insurance claims are simple, so why would you face the loss adjuster without the support of your very own expert fighting your corner?

Ignorance of the Law is No Excuse — Nor Is Ignorance of Non-Disclosure

We come across people every now and then who get insurance by lying on their form and think they’re deceiving the insurer. In fact, it’s very difficult to deceive an insurance company, and (quite apart from the morality of the issue) it’s dangerous to try it.

In fact, the false information doesn’t need to have anything to do with the insurance claim. With motor insurance, for example, your claim for an accident on the road will be refused if you’ve given false information about where you keep the vehicle overnight.

The same thing applies to the insurance for your home, whether building or contents. If the insurer’s loss adjuster discovers any discrepancy in your declarations when you took out the insurance policy, you’ll find yourself footing the bill for any repairs or replacement needed.

But What if It’s Not Your Fault?

It’s easy to say that it would serve anyone right to be left in that position if they’ve lied or deliberately withheld information. In fact, a recent case shows that it’s possible to be stung even if you’ve done nothing wrong.

A family who were having a loft extension built for their home faced disaster when the chimney collapsed during the work, leaving the house having to be rebuilt. The contractor was fully covered and made an insurance claim on his policy — only to have it turned down on the basis of three outstanding CCJs he hadn’t declared.

The contractor has claimed that he didn’t know about the CCJs at the time (a plausible claim, in fact) and paid them off as soon as he found out, but this made no difference. Not only did the loss adjuster refuse the claim, but the policy itself was voided.

The really disturbing part of this is that the family had done everything right (including checking the contractor’s insurance) but still ended up having to fork out over £250,000 to rebuild their home.

It’s hard to see what they could have done differently, but it does underline the vital importance of answering every question with complete honesty when you set up your own insurance policy. Allied Claims would strongly advise you to go through a good insurance broker, who’ll help you ensure all information is correct. Then, if you do have to make a claim, we’ll be able to get you what you’re due.

Here’s Your Chance to Throw Away £20,000

I recently worked with a client who was making an insurance claim for £50,000. It was a good claim, too, with nothing the loss adjuster could object to — except for one little detail. It turned out the claimant was underinsured by 40%.

The result? Instead of receiving the £50,000 needed to make the necessary repairs to their property, this person only got £30,000 and had to pay out for the rest. They might as well have thrown that £20,000 in the bin — simply because they didn’t check the Average Clause on their insurance policy.

When you initially insure your home, the insurer will request its “insurance value”, which will become the sum for which your home is insured. This will be used to calculate the premium you pay on your policy, as well as the amount that can be paid out if you need to make a claim.

If the figure you’ve given the insurer is too low, you’ll be underinsured. It’s not difficult to get the right figure when you first take out the policy. The problem comes if you simply let it be renewed year after year without updating the information, while the actual market value of your home leaves that figure far behind.

The Condition of Average

So why should this be a problem? The reason, of course, is that any insurance claim you make would involve asking the insurer for more than your premium covers, and no business would survive if they allowed that to happen. So all policies allow the insurer to apply the Condition of Average.

This specifies that if, for example, you’ve only declared 50% of the insurance value, you’ve only paid 50% of the premiums and the loss adjuster will only allow 50% of your claim. If you were claiming £50,000, with an excess of £250, for a property worth twice the declared value, the calculation would be:

  • 50% Average of a £50,000 claim = £25,000
  • Less policy excess of £250 = £24,750 pay-out
  • Total loss on £50,000 claim = £25,250

A loss of this size could be devastating, so if you think you might not be up to date under the Average Clause, consult your insurance broker as soon as possible. Alternatively, of course, you’re always welcome to get in touch with us for a chat about it.

Insurance Claim and Occupancy Clause on Household Policies

Water damage insurance claim

Before you make an insurance claim on any insurance policy you have, it’s essential to read through all those fine-print clauses. Yes, it might be boring, but not nearly as bad as being hit by a restriction you weren’t expecting when you try to make a claim.

A case in point is the Occupancy Clause.

Most home insurance policies, and the majority of policies for commercial properties, include a clause that addresses the “occupancy issue”. The exact wording will vary from policy to policy, but what they all say boils down to stipulating a maximum length of time the property can be left unoccupied, if you need to make an insurance claim is usually 30 days.

If you’re intending to leave the property unoccupied for longer than this, the Insurer must be notified, preferably in writing or by email, and specified actions must be taken by the Policy holder. The most common are that the heating must be kept on, bi-weekly visits must be made, and that an alarm must be installed.

However, it’s vital to check exactly what your policy says and make sure you know what needs to be done, in addition to informing the Insurer if the property is going to be empty for more than 30 days.

This can apply to any circumstances when the property will be unoccupied, but it’s particularly relevant to anyone letting out a property. The landlord must notify the Insurer as soon as the tenant has moved out. In many cases, the landlord will be making repairs or decorating before the new tenant moves in, and this can easily stretch out beyond 30 days so watch out if you are about to make an insurance claim.

Whether your insurance is for a domestic or a commercial property, make sure you know your obligations under the Occupancy Clause. If you don’t, there’s a good chance that you’ll be left without a penny if you have to make a claim.