Insurance firm won't pay in full

Property questions are answered by David Yeates, a freelance journalist who is editor of www.french-property.com

25 February 2010

OUR insurance company is refusing to meet the full cost of the damage to our house and possessions when tiles came off the roof during a recent storm. Is there anything we can do about it?

Legally you are entitled to refuse an offer of compensation from your insurer without prejudice to your claim, provided you do so within any time limits laid down in the policy.

You can then bring evidence of why you consider the offer to be unsatisfactory, then hammer out a settlement figure with your insurer.

In coming to a final figure the general legal principle that applies is that the insurer should put the insured person in the same position as they were before the incident, without loss or profit.

As with UK house insurance, this principle may be qualified by specific clauses that limit the level of the guarantee, or include an excess sum that is deducted from the payout.

Those insurance policies with “new for old” protection should normally enable you to obtain full compensation, but that does not then grant you the right to something better than the goods you owned in the first place.

The insurance company are not going to replace a 25-year-old black and white television with a new 40 inch plasma version.

Insurance Assessment

If it is a small claim (usually under €2,000) insurance companies normally pay out without asking too many questions, beyond seeking proof of damage and ownership of the goods and an estimate for repair of the damage.

They will then either make an initial payment pending completion of the repair, or pay you in full, effectively then leaving you to decide whether you go ahead with the work, or how you go about it.

In relation to large claims for damage to property, the insurers will normally engage their own expert.

If their own estimate is lower than that from a tradesperson you hired, this may be because they consider that the estimate is excessive, or that you are proposing to do work that is over and above mere restitution of your position prior to the damage.

The insurer may also take the view that the damage was worse than might normally have occurred because you have failed to properly maintain the property, or that improvements you carried out were not done properly.

It may just be that the expert has got it wrong.

In relation to claims for damage to possessions, an offer of less than full compensation may be because you have not been able to provide adequate proof of the existence of the goods, or of their value.

That is why keeping your bills and taking an inventory and photos of your most treasured possessions (and keeping these documents in a safe place) is advisable.

The insurer may also think you have overvalued the goods or that what you paid was not a true market value.

Finally, whether for a claim for property or possessions, the insurance company may make a reduction for depreciation, based on the principle of leaving you in the same position as you were before the damage.

So for all these reasons, the level of the insurance payout may well be below your expectations.

Complaints Procedure

If you still feel the compensation is not high enough, then you should make a formal complaint to the insurance company using the procedure set down in the policy.

If necessary, get a second opinion from your own professional, an expert d’assuré (insured person’s loss adjustor).

You may even find that the insurance policy offers the opportunity for a second opinion, paid for by the insurer.

If it did, you would also be entitled to choose your own expert.

If you still feel you have not received proper redress, you should write to the insurance médiateur (ombudsman).

However, you are not obliged to accept the recommendation of the médiateur (neither is the insurer) and if no agreement can be reached, final recourse can only be to a court and you must bring an action within two years from the date the dispute.

One way of limiting disappointment with claims is to make sure you take out a sound policy with a reputable company.

Do not just pick the cheapest one - it is only when you actually make a claim that you can really judge how good a choice they are, not just while paying your premiums.

Ask friends for their experiences.

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