20 March 2013

Posted by Discount Insurance on Wednesday, March 20, 2013
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Policyholders are immune from being sued by companies in insurer’s supply chains a High Court has ruled.

In the case, A.J Building and Plastering Ltd attempted to sue Samantha Turner, Sheila Munday and Martin Dalling, who were all insured by Zurich, for money owed to them following work carried out to rectify flood and storm damage to their homes in 2009.

Rok Building were appointed by Zurich to carry out the necessary repairs, who in turn subcontracted the work to local company A.J Building and Plastering Ltd.
Zurich paid Rok for the work. However, Rok went into administration soon after and failed to pay A.J Building.

A.J Building went to the High Court claiming that the three householders were personally liable to pay for the work carried out. It cited paperwork signed by the trio which, it claimed, put them under contractual duty to cover the payments.  

However, the Judge (Andrew Keyser QC) dismissed A.J Building’s argument, saying that it would be wrong to make the policy holders bear the risk.

He decreed the company had been the final link in the contractual chain and it would be wrong to make the householders account for money, paid by Zurich, “disappearing in Rok’s hands”.

The policy holders were absolved of all liability by the judge.

Homeowners should always have comprehensive home insurance provided by the likes of Discount Insurance.

Richard Williams

Source: Insurance Times