Subrogation – Can an Insurer recover a claim pay-out from a third party

published on March 5, 2019 by Peter

A common issue arises in property claims when a house has been recently re-plumbed and a leak occurs relating to a faulty fitting. Under the policy the insurance company must pay for the damage caused by a leaking pipe fitting. If that faulty fitting was installed in the last 6 years then Insurers have the right to recover the full pay-out from that fitting manufacturer. The policy wording also ensures that the policyholder must cooperate in every way to help the insurance company recover. The insurance company will normally at their own expense pay their own solicitor to take the legal action.
This then becomes a second opportunity for the policyholder to make a second claim for uninsured losses and he/she can use the same solicitor as the insurance company and in most cases avail of a free legal recovery. The normal uninsured losses are

  1. The excess on the policy.
  2. Underinsurance shortfalls. If the policyholder wasn’t fully insured for his property, then insurers can apply average to the claim and only pay out proportionately to the percentage covered.
  3. Loss Assessors fees. The cost of preparing a claim isn’t covered under the policy but supervision of reinstatement is.
  4. Any other losses the policyholder may have e.g., unpaid leave to deal with the claim, inconvenience, the cost of repairing the pipe/fitting etc.

The claims above are relatively small in nature but we had a previous case where the claim pay-out was €5 million and the insurance company took an action against an electrical light manufacturer who supplied faulty downlights causing a large hotel fire.

If you have a property claim, have it professionally assessed. In Property Claims Loss Assessors Ltd we are Engineers and Building Surveyors with over 20 years’ experience. We assess fire, pipe leaks, storm, flood, subsidence and break-in damage, etc. Our first survey is free and we are a ‘no win no fee’ company.

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ROI: Land 01 5620082 Mob 087 6165435
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