The Cumbrian floods of late 2015 seem like a distant memory. Certainly not for our household customers.
See how one household customer was affected by the Cumbrian floods and how his claim as was managed by our team.
Material Damage and Business Interruption
The insured, a manufacturer of complex stamped and pressed components in different metal alloys, suffered a major fire at their factory. The fire was discovered by an employee in one of their machine rooms located on the buildings upper ground floor.
The employee had gone to check on a wire erosion machine which had been left running in the room. Although the fire had extinguished itself, it caused serious damage to:
As a result of the fire, the Policyholder was not able to manufacture tools. This part of the business was subcontracted whilst new machines were ordered.
Following an investigation by loss adjusters, forensic scientists concluded that the fire was a result of an electrical fault in a portable air-conditioning unit which had been recently purchased by the insured. In the immediate aftermath of the fire, the Policyholder indicated that they needed a contractor to attend and carry out initial cleaning and rectification work so that the factory could be restored to full production with the exception of the affected area.
AXA's loss adjuster quickly arranged for contractors to visit the site and do the necessary work. Competitive quotations were then sought to carry out the reinstatement works to the damaged building. Claims costs for buildings, contents and stock were agreed.
As a result of the fire, the insured lost their ability to manufacture their own tools for their press machines. During the interim period, the Policyholder had no alternative other than to outsource this work to other suppliers, some of which were competitors, whilst they waited for new machines to be supplied. Once the replacement erosion machines had been supplied and the associated training had been completed, the business was back to normal and the insured was able to produce their own tools within three months.
Both the broker and the client were very satisfied by the outcome of this case. Throughout the duration of the claim, Large Loss Claims Handlers regularly worked with the adjuster and the insured to ensure the steady progress of the claim.
The insured, a manufacturer of bathroom equipment and household brassware, manufactured and sold copper gate folds (a stop cock style of tap) and head collars. The tap was sold to a plumber who installed it in a four storey office block and cellar belonging to a chemical factory in the Midlands.
The gate valve failed and water escaped causing damage to all floors, electrics, alarms and computers. Ceilings collapsed and there was extensive water damage throughout the building. The fitting had been installed for a period of approximately one month. The leak was caused by the head of the valve shearing off.
A claim was made by the property owner initially to the plumber who had installed the tap and was subsequently redirected to the insured. On notification, AXA instructed loss adjusters who were able to obtain the tap and arrange for to it be examined by the insured. A positive identification of the product was made and it was confirmed the tap was indeed one of the insured's products.
Following destructive testing a defect was found in the casting and liability was accepted. On accepting liability, AXA's adjuster worked with the contractor repairing the damage to adjust the loss. A claim of approximately £14,000 was settled representing the cost of repairs to the third party property.
The claimants alleged they had become stuck on a grass verge after skidding due to snowy weather when the insured vehicle lost control on the same corner, collided with the rear of their car and shunted the Claimant's vehicle forward into a lamp post. Claims were made for vehicle damage and injury to the third party driver and a male and female passenger totalling £80,000.
Our insured driver confirmed he had skidded and collided with the rear of the third party vehicle but it had already hit the lamp post. He stated he was travelling at low speed (5-10 mph) prior to the impact and advised that when speaking to the occupants at the scene they advised that the RAC had already attended and that the RAC had refused to move the vehicle as it was “wrapped around” the lamp post.
In light of the circumstances and our insured's insistence that he was not responsible, AXA carried out extensive investigations with all relevant parties and submitted disclosure requests for copies of the call recordings between the third party and the RAC. AXA received recordings of the calls between the first Claimant and the RAC which confirms that they were contacted prior to the insured colliding with the rear of their vehicle.
In the first instance at 20.42 the first Claimant advised that he had collided with a street light, he was stuck and he thought that it was a write off. He then called back at 21.36 advising that the “vehicle had now been hit in the back.”
It is noticeable upon listening to these calls that the claimant's attitude and story changes. During the second conversation the claimant states that his car was fine before and that he was simply stuck, and he asks about getting a courtesy car because the driver had admitted liability.
Proceedings were issued and the case was defended on the basis of exaggerated claim for injury and loss and a bogus additional passenger claim. Fraud was pleaded within the defence and the case was set down for trial.
It should be noted that our insured driver resides in the Virgin Islands and took time and effort out of his busy life to assist AXA Insurance with the defence of this claim. AXA paid for his travel expenses to fly over to the UK for the trial.
Despite numerous discussions with the third party and their legal team where we highlighted the inconsistencies in their case, they insisted on proceeding, hoping to call our bluff and expecting a settlement offer. AXA stood firm and no such offer was provided.
On the day of the trial the claimants asked for a few minutes which was granted and at this time they issued a notice of discontinuance. The judge approved this notice but awarded the defendant indemnity costs in the sum of £15,500 payable within 21 days to AXA Insurance.
Unsurprisingly, the costs payment was not received, so AXA decided to proceed to bankruptcy hearings with the third parties as they had no known assets. On the day before this hearing was due to take place the claimants paid our costs in full.
Our full file of papers was passed to the CPS to consider committal proceedings against all three claimants as we gathered such good evidence against them all. The customer and broker were delighted with the outcome, and particularly with the fact that AXA had supported them and maintained a firm denial of this case all the way to trial, reaffirming our zero tolerance approach to fraud.
The insured vehicle was stolen and reported to AXA on 28 November 2014. The validation process began on 1 December 2014 and no concerns were highlighted. The brokers had advised this was a difficult time for the insured, as a loss of vehicle severely impacted his ability to trade. In light of this information a Senior Claims Handler took ownership of the claim and liaised with both the brokers and the policyholder to finalise the claim validation as quickly and efficiently as possible.
On the 12 December the insured contacted AXA advising he wished to hand deliver documents to AXA as he feared they would get lost in the mail. When the insured arrived at the office, the Handler took the time to listen to his concerns about the vehicle itself amongst various other associated details. The Claims Handler explained the process, clarified some of the theft circumstances again and also explained that we would value the vehicle on market evidence, in turn settling the claimants concerns regarding the vehicle valuation.
The insured left the office extremely impressed with the service he'd received and thanked the Handler for taking the time to speak with him.
The claim was settled on the 17 December with the insured accepting our first valuation offer. The insured was very complimentary about the claims service to his brokers who were also incredibly impressed with the service both they and their client had received.
Flood claim case study
On 5 December 2013 at approximately 9.15pm the premises occupied by tenants East Coast Cinemas Ltd as a four screen cinema complex flooded. The flood waters dislodged the folding entrance doors at the front of the cinema and inundated the interior.
The landlord requested the tenant representative be used as the main point of contact for the claim given the focus on the tenant's potential loss of revenue. At the outset, AXA recognised the importance of getting the cinema reopened as soon as possible to allow it to trade during the peak school holiday period. The usual background financial checks were undertaken quickly and with the assistance of underwriters and Ipswich Branch, policy liability was agreed just eight days after the flood - giving the client peace of mind that he had our full support.
A first interim payment of £30,000 was processed at the same time enabling the tenant to pay outstanding staff wages. A further interim payment of £40,000 was made less than a month later allowing the tenant to keep up the momentum of the reinstatement. In the immediate aftermath, and before liability was agreed, AXA instructed Davis French, a disaster response and damage management consultant, as the specialist drying expert who surveyed and supervised the drying contractors to undertake very early strip out and drying out.
AXA and GAB Robins considered various options to take pragmatic measures and to reduce business disruption. This included managing the reinstatement by reopening the less affected screens and projectors pending full reinstatement of the whole cinema. With three of the four screens open for business by mid-February, the tenant was just in time to catch the half term peak trade.
It was agreed that the reinstatement proceed on the basis of an agreed scope of works prepared by GAB Robins Surveying Services and priced by nominated contractors. This avoided the need to put the work out to tender, saving an estimated two months for the tenant.
Unauthorised festive rave case study
On Friday 30 December a VPS Alarm was triggered at approximately 9pm when a group entered the insured property through a fire door. In response to this incident, the following actions occurred which helped protect the property and avoid a large claim:
Large escape of water case study
The following case study demonstrates our ability to work with the broker and the client to tackle the market issue of escape of water and to put in place tailored risk management solutions to protect valuable blocks of flats.
A fork lift truck at a wholesaler of printer's ink collided with racking in their warehouse causing a major section to collapse with extensive damage to the racking and the ink estimated at over £200k.
Our Loss Adjuster was on site the same afternoon to discuss what initial measures were needed and to guide the customer through the process. The Adjuster quickly agreed to the appointment of a specialist engineer to assess the extent of the damage and to supervise the removal of debris and to minimise secondary damage.
Specialist cleaning techniques had to be employed to remove ink residue from the warehouse and yard. Early interim payments were made to assist with the Insured's cash flow.Our Accountant worked with the Insured to quantify the extent of the stock loss. There was a lead time for the replacement of damaged stock and we therefore worked with the Insured to agree the salvage and 'repotting' of as much ink as possible.
This greatly reduced the impact on the Insured's business. The claim was quickly concluded and the Insured sincerely thanked us for the way we had supported them throughout the whole claims process.
A customer entered one of the Insured's convenience stores in the early morning to purchase 2 bottles of wine. Whilst walking down one of the stores aisles, she fell and suffered bruising to her hip and upper leg. The Insured's staff immediately went to her aid, helping her up and sitting her in a chair before administering first aid.
She immediately said that she had fallen over something on the floor but declined medical treatment. The Insured's staff pointed out at the time that there was nothing on the floor. This conversation was witnessed by 2 other members of staff.
Two months after the accident, the claimant instructed solicitors to pursue a personal injury claim alleging she had tripped over a plastic strip on the floor. The claim was submitted through the Ministry of Justice portal. The claimant alleged that, in addition to the injuries to her hip and leg, she was suffering from nightmares. The claim was estimated to be in the region of £14,000.
Investigations were carried out by an AXA Claims Inspector who visited the shop. Witness statements were obtained from the Insured's staff along with all relevant accident related documentation. Following our investigations, liability was denied on the basis that there was no evidence anything had been left on the floor to cause the claimant to trip or slip.
Following our denial of liability, the claim was subsequently dropped.
In the early hours of Christmas day, a river flowing nearby one of our motorcycle trader clients burst its banks. Water subsequently flooded the premises and, in total, 90 motorcycles were submerged. A claim was made under the AXA policy on 27 December.
The Claims team quickly responded by validating cover and an in-house engineer was appointed to inspect the vehicles. On inspection, all 90 motorcycles were beyond economical repair and so values had to be agreed on a total loss basis. Our customer provided the engineer with suitable information and documentation and values were quickly agreed.
An interim payment of £300,000 in respect of all the motorcycles was made by EFT straight into our customer's bank account on 10 January. The payment was made within nine working days of receiving notification of the incident.
Our customer was “highly impressed with the speed and general service from AXA” and, in particular, “how quickly we valued the vehicles.”
A collision occurred between an AXA policyholder's vehicle and a third party vehicle in the Halifax area. The incident was reported by the AXA policyholder.
The named driver stated that she had stopped at a set of traffic lights in a queue of traffic at a pedestrian crossing. When the lights changed, the vehicles in front of her started to move off.
Without notice, and for no apparent reason, the third party vehicle braked suddenly. The insured vehicle was unable to stop and collided with the third party at very low speed, causing minimal damage. At the scene, the insured driver noted that only the driver was present in the third party vehicle.
Immediately following the collision, the insured driver contacted her husband, whom attended the scene shortly after, and was able to verify those present. The third party mentioned no injury at the time, and so when initially called, the Police refused to attend. It was only when the third party declined to exchange insurance details that the Police were again contacted and attended the scene.
A claim was subsequently received from the third party driver alleging whiplash style symptoms, along with claims for two other “phantom” passengers. Intelligence searches revealed that the third party had previously been involved in an accident just 15 days prior to the accident in question.
When the Insurers of this incident were contacted, it became apparent that they were also investigating their claim due to concerns that it may have been staged.
AXA's insured driver and her husband provided both Statements of Truth confirming that there were no passengers in the third party vehicle. These statements were presented to the third party's solicitors, alongside evidence of the claimant's incident two weeks prior. The claim was not pursued.