Complaints that involve insurance 

Insurance is a financial product. It is there to protect the policy holder from suffering some financial loss because of a sudden and unexpected incident (a peril listed in the policy).

The most common forms of insurance in respect of housing are: 

• property insurance (buildings or contents) 
• liability insurance  
• new build warranties  

Buildings insurance will cover the cost of damage to the building caused by one or more of the perils listed in the insurance policy.

These are usually: 

• fire  
• escape of water 
• storm, tempest, or flood 
• subsidence 

Contents are the moveable items in your home and tenant’s fixtures and fittings. The traditional explanation is that if you turned your home upside down, anything that fell would be a content. It covers the loss or damage to the items in your home caused by one or more of the ways listed in the policy, such as: 

• an escape of water (leak) 
• storm related damage 
• fire 
• accidental damage (usually an additional add-on) 
• theft or burglary (some policies require you to have special locks)  

Liability insurance covers the legal liability of the person insured. This means the insurer would pay out where the landlord has been responsible for negligence for example.  

Ultimately, it would be for the courts to decide on whether a person is liable for a loss. A liability insurer will sometimes step in and handle the claim and respond to it on behalf of its policyholder. 

In cases of new build properties there could be a warranty. Warranty providers are usually responsible for setting build standards in line with the Buildings Regulations or higher standards.  

In the first 2 years, the developer will be responsible for making good any defects and snagging. After 2 years the warranty provider will step in where there is a defect which is more than just cosmetic or a breach of one of the standards that requires remedial action.   

In respect of your home, the following is usually the position: 

Landlords are not always responsible for damage to contents that happen sudden and unexpectedly. For example, if a pipe becomes damaged, and a leak occurs. 

The Ombudsman will only find the landlord responsible for damaged contents where: 

• the landlord knew, or reasonably ought to have known, the type of damage that would have happened if it did not act – for example knowing about a damaged pipe and not repairing it until after it leaks 
• the landlord unreasonably delayed carrying out a repair which caused the later damage 
• the landlord or its contractors directly caused the damage, for example by spilling paint on carpets for example 
• damage was caused to decorations by the landlord trying to complete a repair  

It is important for residents to take out contents insurance where they can. If the landlord is responsible for the damage, the contents insurer can sometimes claim its outlay back as well as your policy excess. This is called subrogation.  

The Housing Ombudsman can consider a complaint about the landlord’s actions, for example how it handled a repair, but is not permitted to consider the actions or omissions of the insurer. A landlord may decide to refer a claim to its insurer, and we may say that was appropriate. 

It may be appropriate for a landlord to allow its insurer to appoint contractors to do the works to the building. This can keep costs low and can mean leaseholders or shared owners will not be asked to contribute via the service charge.