Home Insurance payout - Changing replacement materials?

St1mpMeister

I have an insurance payout for water damage in my property.

Part of the damage was to the carpet in the living room for which I've received a balance to replace it with new carpet, but frankly I'm sick of carpet and want to go for a different flooring material (wood or tile) and then can put down rugs or whatever where required.

Is it ok to change the flooring material to something else and I can pay for whatever extra it costs on top of the insured balance?

Sue Pa Key Pa

The principle you are dealing with here is known as 'betterment & indemnity'. Essentially, you can't claim for an improved situation than you had before the accident.

If you had a perfectly good carpet and it is damaged, you can claim for it's replacement. Obviously, you cannot claim for the extra cost that a timber floor would be over the carpet, but the insurer could be within their rights to insist you replace the carpet or they won't pay you anything for this item.

The logic behind this is because, for instance, if you plan to rip up the carpet and then water damage occurs, the carpet is deemed to be of no value to you and you have not suffered financial loss. You were going to chuck it anyway. Discuss it with your insurer and come to agreement

St1mpMeister

I hadn't planned to rip up the carpet, but now that I have to replace it I'd prefer to put down something like tile that won't get damaged if water damage occurs again.

What happens if you are unable to find the same carpet colour that you had before, is that not a grounds to replace it with something else? I haven't been able to find the same colour carpet when I initially looked.

Sue Pa Key Pa

Just re-reading your original post (while sober). Had you received an initial payment and have now received the balance, otherwise known as the 'retention'? If so, the matter is closed. You can do what you wish with the funds

With regards to not finding the same colour etc., insurers are only obliged to indemnify you for the cost of a carpet of similar quality, with a deduction for wear & tear depending on age. You don't get new for old on floor coverings older than a couple of years

Sue Pa Key Pa

Just re-reading your original post (while sober). Had you received an initial payment and have now received the balance, otherwise known as the 'retention'? If so, the matter is closed. You can do what you wish with the funds

With regards to not finding the same colour etc., insurers are only obliged to indemnify you for the cost of a carpet of similar quality, with a deduction for wear & tear depending on age. You don't get new for old on floor coverings older than a couple of years

St1mpMeister

Sue Pa Key Pa wrote: »

Just re-reading your original post (while sober). Had you received an initial payment and have now received the balance, otherwise known as the 'retention'? If so, the matter is closed. You can do what you wish with the funds

With regards to not finding the same colour etc., insurers are only obliged to indemnify you for the cost of a carpet of similar quality, with a deduction for wear & tear depending on age. You don't get new for old on floor coverings older than a couple of years

I have 80% of the payment, remaining 20% retention once the job is complete and verified.

I'll give the assessor a shout on Monday and say that since I wasn't able to find the carpet I wanted could I use that balance toward a different material and I'll pay whatever additional costs if price is higher than carpet.

newacc2015

St1mpMeister wrote: »

I have 80% of the payment, remaining 20% retention once the job is complete and verified.

I'll give the assessor a shout on Monday and say that since I wasn't able to find the carpet I wanted could I use that balance toward a different material and I'll pay whatever additional costs if price is higher than carpet.

I think you use the 80% to buy whatever you want. You just wont get the 20% remainder as you are changing the floor type

Sue Pa Key Pa

St1mpMeister wrote: »

I have 80% of the payment, remaining 20% retention once the job is complete and verified.

I'll give the assessor a shout on Monday and say that since I wasn't able to find the carpet I wanted could I use that balance toward a different material and I'll pay whatever additional costs if price is higher than carpet.

They're usually reasonable about these things and will agree a solution with you. My experience is that they appreciate if you are straight with them, they've heard every made up story before and it pisses them off.

St1mpMeister

newacc2015 wrote: »

I think you use the 80% to buy whatever you want.

Is this true?

Sue Pa Key Pa wrote: »

They're usually reasonable about these things and will agree a solution with you.

Just on a hypothetical basis, say I wanted to use part of the 80% to pay for something other than the intended job, is this ok, or would the insurance demand re-payment?

Just that some of the work (such as painting walls etc) aren't strictly required since the paintwork looks acceptable. Part of the payment is to take down the walls that got damp and put new ones up, but to be honest they look ok and have dried off now.

I understand that I lose the extra 20% but is that the only risk?

Sue Pa Key Pa

Insurers used to assess a claim and pay the value of the loss. On too many occasions, policyholders didn't effect adequate repairs and held on to the cash. This used to lead to further claims for the same cause (mainly leaky roofs or pipes). Now they issue enough money to get repairs underway and pay the balance (retention) on receipt of invoices and photos confirming all works are completed.

If you don't supply the final documents, you forfeit the balance. If you suffer a further loss and the cause can be established to inadequate repairs for which you were provide the full amount, it is likely the claim will be declined

If you have received payment for damage, where none has occurred, you should refund it to your insurer

St1mpMeister

Sue Pa Key Pa wrote: »

If you have received payment for damage, where none has occurred, you should refund it to your insurer

Why? What happens if you don't?

Sue Pa Key Pa

St1mpMeister wrote: »

Why? What happens if you don't?

Because you cannot make a profit from an insurance claim. It is fraud

Senna

And i bet the OP will be the first to complain about rising home/car insurance costs.

Even if you think the wall is fine, are you qualified to know? The outer skin has dried but if there was a payment, I'm sure it was because there was significant water damage. Use the payment to fix the root-cause and restore the property back to the pre-damage level, its not there for you to go on holidays with.

St1mpMeister

I'm still not clear on what the repercussions are apart from "it's not the done thing"?

I'm looking for specifics on what happens in this case, purely from a curiosity standpoint. e.g. do they demand the money back in some format? Are you taken to court? etc

Sue Pa Key Pa

St1mpMeister wrote: »

I'm still not clear on what the repercussions are apart from "it's not the done thing"?

I'm looking for specifics on what happens in this case, purely from a curiosity standpoint. e.g. do they demand the money back in some format? Are you taken to court? etc

If you are looking for advice on how to conduct fraud, I'm not your man.

If you have received funds for damage that has not occurred, give it back to your insurer

St1mpMeister

Nope just that there's no clarity on what happens after... almost tempted to try to see what happens*





*joke