Don't fall victim to an insurance catch like the Ecclestones! All the policy pitfalls you never knew could stop you getting a payout - after couple's oversight cost them £25m

Daily Mail​

23-04-2025

As Tamara Ecclestone and her husband learned the hard way, having home insurance doesn't necessarily mean you're covered for every eventuality.
The F1 heiress and Jay Rutland were unable to recoup any of the £25million lost in Britain's biggest burglary because of an astonishing insurance blunder.
International jewel thieves ransacked the family's Kensington mansion while they were on holiday, taking millions worth of priceless gems, watches and cash.
But the family could not claim a penny back for the stolen goods because the insurance policy for their lavish £75million home contained an exemption clause for watches and jewellery that had previously gone unnoticed.
The bombshell was one of several revelations in the Daily Mail's new podcast Heists Scams and Lies: The Hunt for Tamara Ecclestone's Missing Diamonds.
Home insurers are now accepting as few as one in three claims to get properties fixed after fires, flooding and other issues, with rejections rising in recent years.
The percentage of claims accepted for buildings and contents policies in 2023 was 72 per cent - down from 76 per cent in 2022, Financial Conduct Authority data found. For buildings-only cover it was 63 per cent in 2023, down from 67 per cent.
MailOnline has now gone through some of the common reasons for insurers not paying out – from lack of cover to underinsurance and the 'wrong type of weather':
Lack of cover
Many claims are rejected because something is not actually covered by a policy, such as accidental damage or certain items being excluded in the terms and conditions.
This is what Tamara Ecclestone and Jay Rutland found when they realised they could only make a £45,000 claim for 25 or 30 doors smashed down in the burglary.
Watches and jewellery were specifically excluded from the policy on the couple's property, so they could not claim against the £25million worth that were stolen.
Another common issue often not covered is damage caused by pets, such as a dog destroying a sofa – although this can sometimes be added as an optional extra.
'Wrong type of weather'
Storm damage is the most likely reason for a home insurance claim rejection - with 9 per cent of extreme weather claims rejected, according to consumer group Which?
Insurers can sometimes dispute whether the weather conditions can be defined as a 'storm', which can be defined as certain recorded wind speeds in the area.
Damage caused by flooding due to bad weather is the next likeliest rejected claim at 8 per cent – with some rejections when damage had occurred 'too slowly'.
Research by Which? earlier this month suggested insurers are using potentially unfair definitions of storms and floods to reject damage claims made by customers.
Escape of water is the most common home insurance claim in the UK - accounting for about 30 per cent of all home insurance claims, according to MoneySuperMarket.
Last December, a man whose house was wrecked by Storm Darragh was refused a payout after insurers said it was not a storm because the wind speed only hit 53mph.
Dennis Iliffe was informed the winds that battered his property in Kidderminster, Worcestershire, were 2mph too slow for his insurance provider Ageas to pay up.
This is because the Association of British Insurers defines a storm as 'a period of violent weather defined as wind speeds with gusts of at least 48 knots (55mph)'.
An 'absolutely astounded' Mr Iliffe was facing being left £500 out of pocket after getting his aerial replaced and chimney repaired following the storm.
However, after the story was reported in the media, Ageas confirmed that it had since received 'supporting information' from Mr Iliffe and had agreed to settle his claim.
Wear and tear
Homeowners often need to keep their property 'well maintained' for their insurance policy to be valid – and natural 'wear and tear' is normally not included.
For example, roof damage will often only be covered if the roof is relatively new or if it has been checked by a qualified engineer within a stated time period.
Normal 'wear and tear' is sometimes defined as faded or worn carpets, the colour fading on a sofa, the TV breaking because it is old or the window frames rotting.
Among those caught out by the 'wear and tear' policy were couple Ali Clarke and Peter Willis whose ceiling fell on top of them as they slept in Hackney, East London.
A large piece of plaster fell onto 60-year-old Peter's leg, leaving him with a broken fibula. His wife, 56, suffered a bloody nose after being hit by another piece.
But three weeks after the incident their insurer rejected their £7,272 claim outright, claiming the damage to their 1930s semi-detached home was 'wear and tear'.
Malcolm and Anne Terheggen, of Bedfont, Middlesex, also had a claim rejected in 2019 when a section of guttering crashed down from the roof in heavy rain.
Their insurer Ageas initially refused to cover the cost because the wind speeds had reached 40mph which was 7mph below what the firm classified as a 'storm'.
Then, Ageas's claims adjuster visited the property and said the damage had been caused by wear and tear to the fascia - which sits just below the rafters.
Ageas later said hourly rainfall on that day had not exceeded 4.8mm, and cast iron guttering 'should be able to withstand that amount of rainfall at all times and therefore Mr Terheggen's claim was declined as a result of wear and tear.'
Underinsurance
Some properties can be deemed 'underinsured' if the value of the property contents or the total rebuild cost is not high enough on the policy.
This sometimes leads to the insurance provider agreeing to pay out some of the amount claimed under what is described as the 'average' clause.
To give an example, this means that if the sum insured is 25 per cent under the correct value, then there would also be a 25 per cent reduction in the payout.
In monetary terms, someone with £80,000 of contents might only have a £60,000 insurance policy. This means a £40,000 claim would only get a £30,000 payout.
The insurance company could also award a lower payout if it believes the claim has made at an unrealistic value.
And a 'single item limit' is the most that an insurer will pay for one item. This means if your £3,000 ring is stolen but your limit is £2,000, the latter is what you will get.
Wrong information
Providing incorrect information to your insurance provider either in your initial application for the policy or during the claims process could see a claim rejected.
This could include details on the proportion of the roof which is flat or the type of locks installed on the doors, which would be important in a burglary claim.
Non-disclosure of facts is also an issue, such as when someone does not declare a previous claim to try to maintain a cheaper premium or no-claims discount.
It is also important to keep insurers up to date with any changes to personal details such as your employment or marital status, as this could also affect the policy.
Lack of due care
Insurers will want to know the homeowner has done enough to prevent an insurance claim, such as ensuring the doors are locked and the windows are closed when out.
For example, many insurance companies have a minimum requirement of TS007 three-star locks or a combination of a one-star lock and a two-star door handle.
Some policies only cover fire damage if the property has working fire extinguishers which have been installed and then annually checked by a reputable provider.
Lack of due care could also include your valuables being on display. If the insurer can prove that you did not take enough care with your property, it can reject a claim.
Time passed
Claims can also be rejected by insurers if someone is too late making the claim, with many insurers requiring notification as soon as possible after the incident.
Other policies may give you a grace period of up to 180 days, but it is important to not delay making a claim and to check the small print on your policy.