One-stop answer to subsidence wrangles

Insurance companies are working on a 'one-stop' system for people who face difficulty in claiming for subsidence repairs because they must deal with two different companies.

Homeowners who have switched companies to get lower premiums may find their new insurer will pay for only part of the repairs, because some of the damage occurred while the house was insured by a previous policy.

The new system is being developed by the Association of British Insurers (ABI). Some companies already operate an informal system whereby the present insurer pays the full claim and recovers some from the previous company. Now the ABI is trying to set up a formal agreement for all members. About 150 of its 450-plus members sell buildings insurance.

Tony Baker, ABI's public affairs manager, said: 'The aim is that where there has been a change of insurer but not of owner, the policyholder would not be inconvenienced in making a claim. They would contact the insurer on risk at the time the claim arises. That company would have the right of 'subrogation' to the previous insurer.'

The agreement would not extend to cases where people move house and discover that there is subsidence which pre-dates the cover they take when they move in.