Misunderstandings between the insured and insurer should always be anticipated…

Misunderstandings between the insured and insurer should always be anticipated…

… yet as the following recent case demonstrates it is up to us all, in the insurance industry, to do what we can to explain the complex words we sometimes use.

The matter of a visual heat detection system

A recent case involved Top Waste Management (TWM) – we have changed the name for the purposes of this case study.
Top Waste Management suffered a serious fire at its premises in January 2022.  The business included the short-term storage of waste, pending recycling.  Some of the waste stockpiles were located inside the Insured’s building; other stockpiles were stored outside, especially for piles of green waste with their potential for internal combustion.
On this occasion, fire had broken out in one of the internal stockpiles overnight, while the premises were closed for business.  It was estimated the cost to reinstate the damage would be in the region of £750,000.
The claim was reported to insurers but it was repudiated.  Lawyers for the insurer cited the policy’s ‘Shut Down’ procedure, shown below:
“A thermal check of all internal waste stockpiles is to be conducted 30 minutes post cessation of processing.  Fire-watch to include use of thermal imaging/probes or visual heat detection system.”
The insurers’ lawyers raised a number of objections to the broker’s representations but the heart of the matter was this: what was meant by the term ‘visual heat detection system’?
To read this fascinating case study click on the link below.