Cautionary tale to include fire cover clause in AST!

Cautionary tale to include fire cover clause in AST!

9:23 AM, 20th September 2021, About 4 weeks ago 51

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We own a small bungalow that we rent out via an agent. We picked a local agent as the property is too far away from our home and neither of us has the specialist knowledge to self manage.

Over the Bank Holiday, we received a call from the agent to say overnight the property had been on fire and was uninhabitable. My husband spent 4 hours fighting through Bank Holiday traffic to find the fire officer racking through the burnt out garage, the tenants in tears and the agent holding the keys and latest electricity certificate.

The agent then told the tenants that our insurance policy covered temporary accommodation, storage of their goods and transport of their goods to their new accommodation. (The garage was destroyed plus one bedroom, the kichen/bathroom /lounge/master bedroom have scorched ceilings but the furniture etc is fine).

I contacted my insurance company who arranged temporary accommodation and a loss adjuster was instructed. The loss adjuster arrived two days later and we gave her a copy of our AST. She read it and informed us that the tenants were not covered in any way shape or form by our insurance as there are no clauses in the AST stating that such cover was to be provided by the landlord – despite those clauses being in our insurance policy.

Our tenants have now had to go into emergency local authority accommodation and they have abandoned their furniture in the bungalow.

Had the clauses been in the AST the tenants would have had 2 years rental cover in another property, they would have had to carry on paying the rent for my property and the agent would still be getting her management fee.

So the moral of the story is to have a good read of your agent’s AST and find an agent who is aware of the legal liabilities that the AST covers.

Carole



Comments

by Jay James

11:22 AM, 26th September 2021, About 3 weeks ago

Reply to the comment left by hpbennett at 25/09/2021 - 16:17I have now checked with Cambridge Citizens Advice and what you state is wrong. They are taxpayer funded through layers of organisations and they will not advise a landlord on landlord matters as a matter of Citizens Advice national policy. In the same way, they will not advise a female of the alternatives to abortion where she only asks for abortion advice, again as a matter of national CA policy. Feel free to copy paste this post and email them to ask whether it is correct or not. So, there is indeed anti landlord bias by taxpayer funded organisations.

by Ian Narbeth

11:44 AM, 27th September 2021, About 3 weeks ago

Reply to the comment left by Stephen at 25/09/2021 - 09:32Stephen, your post is wholly incorrect advice. Commenting in turn:
"Firstly very sorry to hear of your stressful situation.
Unfortunately this can happen to anyone Yes, it can but it is possible for tenants to take out insurance.
Liability always fall on the landlord Not true. And what liability are you talking about?
If a rental property an insurance policy for letting out goes hand in hand with your mortgage provider This sentence makes no sense.
You agent legally speaking is not liable THEY would expect you are covered! The agent is not liable to the tenant but not for the reason you suppose. The agent is not liable because Carole is not liable. If she were liable she might have a claim against the agent if the agent was arranging insurance.
Please check your letting T&C
also any Basic B2 let insurance company would cover rehousing No it would not as Carole's policy does not and as I have indicated above many policies do not cover the tenant's costs unless the landlord is liable
Go straight to the ombudsman/ broker who sold you the insurance Please read my posts above. As Carole has no liability to the tenants, her pursuing the ombudsman or the broker is pointless
I would pursue the insurance company For what purpose? Please read my comments above.
Sorry to criticise like this but your post is not in the least helpful.

by Carole Wicklow

9:28 AM, 28th September 2021, About 3 weeks ago

Reply to the comment left by AP at 25/09/2021 - 07:31
Loss of rent is an oprional extra which I did not take out because as our tenants move out we are selling up. The properties were bought for the future, which appears to have arrived in the guise of a burnt out bungalow! In theory, our rent would have been covered in the event of a disaster by the clause I have already mentioned.

by Carole Wicklow

9:34 AM, 28th September 2021, About 3 weeks ago

Reply to the comment left by Ian Narbeth at 27/09/2021 - 11:44
Thanks again Ian. No-one believes me! I have an email from the Loss Adjuster confirming that both they and the insurance company are standing firm on this one. I have referred the matter to my solicitor now who also agrees with you. Here's hoping this ends up in court so the point can be proven beyond doubt.

by Andrew Miller

8:35 AM, 2nd October 2021, About 2 weeks ago

I have read most of the comments in this thread but have not seen the ACTUAL clause purporting to provide the cover. I just checked our wording with RSA and it's very clear that it only applies where WE are LIABLE for the costs, which we are not and don't want to be. This is a matter for the tenant's insurers and if uninsured it lies with the tenant. Our wording:

We will pay the costs You incur in providing similar short term accommodation for the Residents who normally live in the Buildings if the Residential Property cannot be lived in or accessed because of Damage covered by this Insurance.

by Carole Wicklow

14:54 PM, 3rd October 2021, About 2 weeks ago

Reply to the comment left by Andrew Miller at 02/10/2021 - 08:35
We will pay your costs of reasonable alternative accommodation for your tenants and temporary storage of your tenants furniture while the residential portion of the property can not be lived in or access is denied as a result of damage. This cover will only apply where we have made a payment or accepted liability under the Buildings Section of this policy.
The most we will pay etc.etc.
Provided that tis cover is not insured elsewhere.
It is not insured elsewhere and they have said they are going to rebuild our property.
Go figure?

by Andrew Miller

18:16 PM, 3rd October 2021, About 2 weeks ago

Reply to the comment left by Carole Wicklow at 03/10/2021 - 14:54
I would agree that your wording is more ambiguous. Who is the insurer?

by Carole Wicklow

11:32 AM, 4th October 2021, About 2 weeks ago

Reply to the comment left by Andrew Miller at 03/10/2021 - 18:16
One of the largest in the business, I have had to instruct a solicitor so prefer not to say. As Ian says (as does my solicitor) it isn't the wording of the policy. It is the wording of the AST - there is no legal liability/requirement to provide accommodation/storage/transport of tenant chattels in it, so the insurer will not pick up the liability because it is not there for me as the landlord to cover.
I have three A levels and 15 O levels (showing my age now 🤣) and would have expected that clause to kick in, until the loss adjuster explained why it does not.

by Badger

16:47 PM, 7th October 2021, About A week ago

Reply to the comment left by hpbennett at 25/09/2021 - 16:17
"...it offers advice to all comers, including landlords. The only time they would decline advice is ..."

Not true I'm afraid.

I have been explicitly denied advice by them as a landlord.

by Ian Narbeth

16:52 PM, 7th October 2021, About A week ago

Reply to the comment left by Badger at 07/10/2021 - 16:47
Badger you are absolutely correct. I have it on unimpeachable authority from someone who worked for years at CAB that they will not, as a matter of policy, advise landlords.


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