How will we pay £59,000 flooding bill ask the Mellors?

Thousands of households are just beginning to tackle damage caused by water pipes that froze and burst during December's sub-zero weather.

The insurance industry reckons the bill for burst pipes this winter will top £650 million, higher than last year's, itself a record. Some insurers pay up quickly and with minimum fuss. But others can be more difficult.

Joan and Malcolm Mellors suffered horribly when their home was flooded while they were abroad. The retired couple have owned their four-bedroom detached house in Comberbach, Cheshire, since 1979. For 18 months until last June they had let it to tenants while they lived either at their property in Spain or with Joan's ill mother in Liverpool.

Joan and Malcolm Mellors

Nightmare: Joan and Malcolm Mellors returned to find an uninhabitable home

They moved back into their Cheshire home and put it up for sale. The plan was to live in it until it was sold, while still going to Spain regularly for holidays.

The existing home insurance ran out last August and Malcolm bought a new policy, underwritten by Lloyd's of London broker Equity Red Star through online intermediary insure4retirement.co.uk.

In late November, Malcolm, 64, an ex-construction manager and Joan, 60, a former accounts manager, were on holiday in Spain when UK temperatures plunged. Pipes in their loft froze and when they thawed, water flooded the house. It wrecked ceilings, floor coverings, furnishings, wallpapers and plaster and made the property uninhabitable.

A neighbour alerted Joan, who rushed back on December 3. She contacted Equity Red Star, which sent an assessor on December 7. The damage was estimated at £59,000. For almost three weeks there was little progress, despite Malcolm chasing both Equity and insure4retirement.co.uk. Then at 5pm on Christmas Eve they were told by phone that their claim would be refused.

Equity Red Star took the view the Mellors were not resident, even though they pay tax in Britain and were able to provide council tax and utility bills in their name, as well as tickets showing their travel movements.

There was no definition of permanent residence in the schedule, but on page 14 of the 74-page policy booklet, it said policyholders were required to be 'resident in the first instance for three months and thereafter for 40 weeks on average each year'.

By travelling to Spain in mid-September, the Mellors had left the home empty within the first three months. Another, more obvious policy requirement was that 'the property is not ever left for more than 60 consecutive days'. Malcolm says: 'We've never been away for that long and never would be, especially as we are trying to sell it. I noted that term and was conscious not to exceed it.'

David Holden, chief executive of insure4retirement.co.uk, refused to comment on the Mellors' case, but spoke about the dangers of people failing to disclose to insurers 'full and factual information when completing proposal forms and declaration'.

He warned this could lead to 'problems when they need their insurance most  -  in the event of a claim'. Equity Red Star refused to comment, other than to say that 'Mr Mellors has initiated our standard complaints procedure'.

The Mellors will complain to the Financial Ombudsman Service. 

Beware they're the enemy
Study all policy documentation meticulously  -  and assume your insurer is your enemy and will always seek to refuse payment.

A crucial term in home insurance is the maximum number of consecutive days you may leave the property empty, typically 30. Insurers specialising in the retired market, such as Saga and Rias, where policyholders often spend longer abroad, offer 60 days.

On average, insurers expect homeowners to be in the property for four weeks out of five. Ensure these limits are fully understood and observed.

There are other, more obscure requirements, such as the stipulation in Malcolm and Joan Mellors' policy that they must be in the property 'in the first instance for three months'.

Claims for burst pipe damage are frequent and large. Lloyds TSB says the average loss per burst pipe claim is £2,000, but Axa puts it substantially higher at £25,000.

Practical steps to avoid burst pipe damage include careful lagging of exposed pipes and leaving the heating on. Loft piping is more susceptible to freezing and more likely to cause extensive damage, so always open loft hatches or doors when leaving home, allowing warm air from the heated rooms below to flow up into the roofspace.


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