Homeowners insurance pays half a million for backwater

6.4.2021 – In the summer of 2019, dirty water flowed back into a newly built house. For the client and his family, from an insurance point of view, “an odyssey” began, reports Wittig Ünalp. Your client had taken out residential building insurance with K&M. The Württembergische Versicherung was the risk bearer. In autumn 2020, the parties finally agreed on a regulatory agreement with payment of a total of EUR 589,314.60.

How the dream of having your own house for a family turned into a nightmare from an insurance perspective was recently described by the Wittig Ünalp Attorneys at Law PartGmbB on your Website.

Your client had the “Allsafe domo residential building insurance” with the for his newly built wooden house according to strict ecological standards Concept & Marketing – your independent concept developer GmbH (K&M) completed.

The product designed by the underwriter promises comprehensive insurance protection within the framework of all-risk coverage. The risk taker is Württembergische Versicherung AG.

From small backwater to complex flood damage

Shortly after moving in, there was a backlog of wastewater in spring 2019 with little damage to the bathroom. The landlord reported the incident to his insurance company.

According to Wittig Ünalp, he also commissioned two companies, one after the other, to check the sewer pipe. He considered an overflowing toilet “rather unusual”, but both companies saw no problem.

A few weeks later there was a massive leak, so that there was protective water contaminated with faeces on the entire ground floor. As it turned out later, a missing backflow valve was the cause. The architect forgot to have it installed.

An “odyssey” began for the family

The family had to move into a short-term rented vacation home. “An odyssey began for our client and his family,” writes the firm.

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The landlord reported this loss event immediately and urged K&M to hire an emergency company. A corresponding company was on site with a time delay, but refused to carry out the order and recommended “a differentiated assessment and recommendation of the renovation and security measures”.

In mid-June, the expert commissioned by K&M announced that in the event of such damage, the building would be “pushed off the floor slab” and would have to be completely rebuilt.

After about half a year, the landlord brought in a lawyer

“Again our client took the initiative,” is reported. He organized craftsmen and specialist firms “to save his house after all”. The submitted offers for the renovation were approved by K&M “but only hesitantly and incompletely”. In mid-September he hired a lawyer.

After several exchanges of letters, K&M then distanced itself from the commissioned expert. “However, there have still been no discounts or approvals for the offers for reconstruction that have been available for months,” writes the law firm.

“Rather, the payment of the insured accommodation costs was suddenly called into question because, in the opinion of K&M, nothing had happened on site so far!” The landlord then commissioned Wittig Ünalp at the beginning of November.

“The fact that K&M was now also questioning the accommodation costs, understandably led to existential fears in his family. The fact that a policyholder has to be afraid of homelessness in spite of the corresponding insurance cover left us speechless for the time being, “they commented.

Contractual clauses prevented direct communication

The lawyers criticize that direct communication with the insurer was not possible due to the contractual clauses. “The detour via K&M always had to be chosen, although there, to put it mildly, one was alternately overwhelmed and disinterested with damage of this magnitude.”

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The client’s wish to move into a larger apartment “luckily succeeded at short notice thanks to massive pressure on our part on K&M,” according to the authors of the report.

A new expert carried out assessments on three dates, most recently in January 2020. In September, one and a half years after the loss event, the final form of the loss assessment was available. Finally, both parties agreed on a final regulatory agreement with payment of a total of EUR 589,314.60 to the policyholder.

K&M and Württembergische Versicherung confirm the case

Both K&M and Württembergische Versicherung confirm to the editors of the VersicherungsJournal the settlement of a complex flood damage to a single-family house in 2019 in the greater Berlin / Brandenburg area.

The underwriter also comments on the allegations made in the report. Even after the first damage, a service provider was recommended to carry out damage mitigation measures. He was also on site and recommended a claims field service.

Then, however, the second, larger backflow damage occurred. “The assignment of the claims field service was then immediately expanded to include the inspection of the new and significantly more extensive damage,” it explains.

First advance payment after calculating the expected repair costs

The sales force submitted a report just two days after his inspection appointment. “This did not mean that the building would have to be rebuilt starting with the floor slab. Rather, the report was accompanied by a calculation of the likely repair costs, ”says K&M.

It was then agreed with the customer that cost estimates would be submitted. In addition, a remediation company was recommended by the sales force.

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The underwriter reports on the further procedure: “The offers and invoices submitted below were checked and approved in a period appropriate to the complexity and amount of damage. In this context, various offers were approved and an advance payment was made before the first lawyer was called in. “

Several on-site visits by the sales force

In the case of major damage, several on-site visits by the field service are sometimes not uncommon. “Especially when the offers presented and the repairs listed in them do not appear to be solely due to the damage,” says the service provider.

After it became apparent that the extent of the damage was significantly greater than originally assumed, an independent, publicly appointed and sworn building expert was called in, according to K&M. “At this point in time we have already made payments,” it says in Hanover.

“The principle of assuming the replacement accommodation costs was never questioned. Only the duration of the replacement accommodation and a possible sharing of these costs with the household contents insurer had to be examined. All in all, all replacement accommodation costs were covered, ”the underwriter continues.

Not customary fictitious billing at replacement value

“We did not question our obligation to settle the damage after the regular inspection and communicated this to our customers,” says K&M.

“In the interests of our customer, we finally agreed on a benevolent compensation contribution, although there was a construction defect and the reconstruction of the building was not guaranteed. A fictitious billing at new value is an extraordinary and not customary arrangement. “

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