Is it worth the risk?

Taking a practical view on claims is a very important part of DUAL Asset’s ethos, as a recent settlement attests. A policy was placed on risk in May 2017 to cover the risks associated with installing new services within unregistered land.

With the development underway, the time came when the Insured needed to gain access to the unregistered land and found themselves faced with a gate. When they contacted the party who controlled the access road, they discovered that the party also owned the unregistered land, and the Insured would be required to obtain a licence from this party in order to install the cable, up until the point when the services would be adopted.

The Insured negotiated with the third party and agreed to payments totalling just over £210,000, which were covered by the indemnity policy.

So, what makes this case noteworthy and why was a practical view necessary? The Insured had communicated and negotiated with the third party for over a year BEFORE notifying DUAL Asset of the circumstances and simply presented us with the correspondence and a bill!

All our policies carry a condition that requires the Insured to notify us of any potential claim under the policy within 28 days, and any costs incurred must be agreed with us before they are spent. In this case, there had been a clear disregard for that policy condition.

When the claim was received and discussed both internally and with the relevant insurers, it was agreed that despite the breach of condition, there had been no material prejudice directly because of the delay. In fact, it was clear from the correspondence that the Insured had negotiated hard for the licence and had reduced the original indicative loss by £95,000.

On that basis, DUAL Asset agreed to accept the claim in full. However, it could have been a very different story.

Whilst the Insured handled the claim prudently, by not adhering to the policy conditions, they ran the risk of their claim not being accepted and had DUAL Asset not taken a commercial and practical view of the claim, the Insured could have been left out of pocket, proving how important it is to follow the terms and conditions of your indemnity policy.