Insurance payout delay to be settled by court

Wednesday 28 December 2022

An insurance claim for repairs following storm damage to a house in Alderney ended up in court after the property owner claimed for more than a decade's worth of lost rental income against the insurer.

The damage was reported in Spring 2009 with the insurer - NFU Mutual - initially disputing responsibility.

The homeowner employed a structural surveyor to advise him and this led to NFU Mutual accepting liability for the repair costs four years later.

There followed a dispute over which party had to pay for the structural surveyor's cost as the repair work followed their guidance.

Allegations against NFU Mutual of ongoing delays with authorising payments led to an initial court hearing in Alderney where the home owner claimed "inordinate delays" in the repair work to his property which was only finished in September 2018 - nearly 10 years after the damage had been caused.

The home owner first claimed £165, 523 against NFU Mutual for costs incurred including completing repair work not met by NFU Mutual, and loss of rent due to the lengthy delays in the repair work.

Alderney's court rejected the claim saying too much time had elapsed and the financial claim could not be brought outside of the prescribed period which it said was six years.

The property owner took the case to Guernsey's Appeal Court which found in favour of the property owner.

It agreed that "...if NFU Mutual did elect to repair the Property, it was under an implied obligation to do so within a reasonable time."

It also found that there was a "contractual obligation to pay loss of rent under para. 1 of the Additional Cover."

The case will now be heard again by Alderney's Court which will decide if the repairs were carried out and if they were in breach of the implied terms of the insurance policy, and whether the claim for rent can be sustantiated.