Not upheld: claim settlement dispute and disturbance allowance complaint against esure Insurance Limited

Decision detail

Summary

Mrs G claimed under her buildings and contents insurance with esure following foul water damage to her utility room and kitchen from a blocked drain. esure assessed reinstatement costs at £2,244.61, but Mrs G provided a quote for £14,000 including kitchen refurbishment. When Mrs G declined esure's offer to complete the work, esure issued a cash settlement. Mrs G complained that the settlement was inadequate and that esure should have paid a disturbance allowance. The ombudsman found esure's settlement was fair and in line with the policy, as Mrs G's quote included betterment work not covered, and that no disturbance allowance was due because the kitchen remained functional with accessible cooking facilities.

The Ombudsman's reasoning

The ombudsman applied FCA rules requiring insurers to handle claims promptly and fairly without unreasonably turning down claims. The policy entitled esure to cash settle when the policyholder declined the offer to carry out repairs. The ombudsman found esure's scope of work was reasonable as it covered reinstatement to pre-loss condition (drying, sanitisation, floor replacement), while Mrs G's quote included significant betterment elements. The ombudsman examined photographs and determined the kitchen remained functional with accessible cooking facilities and a microwave available, therefore no disturbance allowance was due. The ombudsman noted esure had offered to consider any additional costs directly related to the water damage.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website