A holiday home up in smoke
Mr Smith owned a timber holiday home located on a pleasant holiday park. He let the property for short-term holidays and insured the home under a specialist holiday-let insurance policy arranged through Lloyd’s underwriters. The timber construction was duly declared, and insurers imposed a Fire Extinguisher Clause as follows:
It is a condition of this hoilday-let insurance that two smoke alarms must be installed on the property. If you fail to comply… this insurance will not cover loss or damage caused by fire.
The Insured duly installed two smoke alarms. However, just before the holiday home was let during the Christmas holidays, the Insured noticed one of the smoke alarms was not working. He was not able to repair the alarm, so he removed it temporarily to have it repaired. Unfortunately, this could not be achieved before the family booked in for their holiday.
While the family was out one day, a fire occurred. The fire was not discovered until the family returned later in the day, by which time considerable damage had been caused.
The fire was reported to insurers. When its loss adjuster discovered that one of the smoke alarms had been removed, the breach of the policy condition was reported to insurers, and the claim repudiated. The Insured had to admit he was in violation of the holiday-let insurance. However, his broker suggested contacting Flaxmans for a second opinion, to make sure he had been treated fairly by his insurers.
Flaxmans agreed to meet the Insured on site. It became apparent that the admitted breach of the condition had not served to increase the likelihood of fire damage at the holiday home and that the loss was not connected to the breach. Flaxmans asserted that the purpose of installing smoke alarms is to preserve life. Flaxmans carried out its own study at the holiday home. It was clear to our experts that, because the tenants had been out for the day, there would have been no-one to hear the smoke alarms to contact the fire service. It was further established that the properties either side of the Insured holiday home had not been occupied. This further reduced the possibility that anyone would have been able to raise the alarm.
Following Flaxmans’ findings and reports, and subsequently managing the Lloyd’s Complaints process, Lloyds finally upheld the complaint, indeed they went on to admit that the absence of a smoke alarm had not been causative of the loss.
Flaxmans won the case for Mr Smith, and he was awarded the full amount of the claim money he was due from the insurer. His holiday home was repaired and once more able to generate an income from letting it out for holidays.