Time to claim for 'Gloria' damage
Storm and flood insurance claims explained
News Staff Reporter
LAST week's Storm Gloria damage has once again proved the reality of climate change and the need to be prepared and covered for such weather phenomenons on the Costas.
With heavy storms, large waves and flooding becoming more frequent, here are a few reminders regarding your insurance in such events.
Read and digest your policy
Firstly, if you only have buildings insurance, it won't cover your kitchen or bathroom fixtures if your policy is with a Spanish company; these count as ‘contents’.
However, if your policy is underwritten by a British insurer, anything that wouldn't fall out if you turned your home upside down is classed as ‘buildings’. Make sure you know the difference, especially if you have two insurance companies.
Building insurance for the freehold community, if you're in a block, only covers communal areas and the outside parts; your own bricks and mortar and everything within it need separate cover arranged by you.
Make certain the sum you have your home and possessions insured for is enough to replace everything as new; if it's not enough, your company may reduce your claim in proportion to the shortfall, so you should monitor and update this year-round.
Secondly, your policy may have an excess, which applies per claimable cause, not per item. Normally, only one applies for a combined buildings and contents claim with the same company. Spanish insurers rarely apply an excess for either, so no outlay for you if the claim is covered in full, but those underwritten in the UK almost certainly will.
UK policies normally have a single-article limit for contents and anything worth more than this should be ‘specified’ on your documents; if you own anything particularly expensive, check your limits in case.
What to do if disaster struck you this week
Hopefully your insurance company has a 24-hour emergency helpline; some of the more sophisticated ones may have a disaster recovery service they can send out to you. This is less common with Spanish insurers, so you may be on your own with the immediate aftermath; and here, you are required as a condition of your policy to take all reasonable steps to minimise the damage.
Of course, ‘reasonable’ will vary; if you’re disabled, you’re not expected to move your furniture out of a room with a gushing ceiling, and you don’t have to go up on the roof to lay a tarpaulin over a hole, but if any damage-limitation action is within your power, do what you can.
Claims for rain damage normally fall into two categories: flood at ground level, and ingress of water (rain coming through a roof, wall, or window, for example). For the latter, rain has to be pretty dramatic for the building to be damaged enough to let water in, as it's generally considered that a correctly-maintained and properly-built home will withstand ‘normal’ severe weather conditions. Typically, a ‘healthy’ house needs at least 40 litres per square metre of rainfall in one hour (four centimetres, or nearly two inches) to damage it; the recent storms will probably qualify, but you may be asked to seek an official weather report.
Ingress of rainwater claims
A loss adjuster is usually sent out to inspect the damage, although a builder may be appointed first to view it, and if they consider the source of the leak to be general wear and tear, lack of maintenance or poor construction, they're likely to refuse to cover its repair.
But Spanish insurers usually cover the actual internal water damage, even if not the leak repair, though British insurers will only do so if your buildings cover includes ‘accidental damage’, an optional extension (if your company offers this for buildings, contents or both, take it. It’s worth the extra premium, since most non-weather-related claims are either for burglaries or for accidental breakage).
Always be prepared for the actual leak entry point not being covered, and having to get it fixed at your own cost before the insurers intervene, although your company may put you in touch with a repairer who does work for them if you can't find your own. Be aware, though, that contractors working for insurers are more expensive than those who do not, so you can probably get a cheaper quote elsewhere.
British insurers typically have a network of builders they automatically send out to do claim repairs and who bill the company directly. If you want to use a contractor of your own choice, you'll need to get an estimate. Despite common belief, one estimate is usually enough; you don't have to get two so your company can authorise the cheapest, but you must ensure all parts and labour are broken down and priced separately if you supply your own quote.
If you use your own choice of contractor, payment is on completion and normally made directly to the builder, although some Spanish insurers pay the loss adjuster's recommended figure, via bank transfer, before work starts. Other Spanish insurers work with assistance companies, such as Mondial, and pay these in bulk directly, so you may not personally receive any money.
Where your own leak damages a neighbour's house, your insurer automatically pays their repair costs in full, since if the source is in your property, you are always legally liable for third party damage it causes.
Floods and the 'Consorcio'
Where water enters at ground level due to torrential rain and overflowing rivers, it's very likely you'll be covered, but your insurance company may not pay it themselves. If the cause counts as a ‘natural disaster’, repairs are covered by the State.
Your insurance company may refer you to the Insurance Compensation Consortium (Consorcio). You will need to complete a form, acquire an estimate and supply copies of your NIE and passport (or DNI if you're a Spanish citizen), plus a copy of a bank receipt showing your premium has been paid, including a breakdown of the part that goes to the Consorcio (this is important as, without it, they will not pay up, but can be requested from your bank or downloaded as a PDF online).
Keep hard copies of all these to show the loss adjuster (the Consorcio sends them out for even the smallest of claims). Once he or she has valued the job, you'll have the cash transferred into your bank account within days.
You'll need to be able to understand Spanish to handle your own Consorcio claim, although this aside, it's a straightforward process. Some insurance companies either deal with them for you or give you guidance on what to do, or even settle your claim themselves and recover the money from the Consorcio.
Don’t jump the gun!
Crucially, however, don't get any repairs carried out until you have firm confirmation that you're covered. Emergency repairs, like a patch-up to stem the leak, count as ‘damage limitation’ and are perfectly acceptable, but any other work might prejudice your claim. If it can't be inspected, insurers or the Consorcio have no proof there was even any damage, and cannot value it, so they may refuse to pay.
Damaged contents that are completely essential and clearly beyond saving (mouldy sofas or mattresses, or appliances wrecked by water) can be replaced, but keep the receipts and original items for inspection. If you can manage without them until the loss adjuster comes, avoid buying new until advised.
Take it slowly
'Chasing up' the Consorcio is virtually impossible, as it's a government office and all the callhandler can do is check the computer records. But they're reasonably efficient, although their workload will be huge after the recent storms so don't panic, they'll get to you in good time.
Likewise your insurance company: if you can bear it, try to avoid ringing them every few days to 'check on' them; they haven't forgotten you, but did you know that over 90% of a claims handler's workload, other than logging new claims, is attending to 'chase-up' calls? That means they're left with just 10% of their time to handle existing claims, so telephoning to pester them slows them down even further!