Christine Seib asks why underwriters take fright at even a minor amount of subsidence
This is a cautionary tale. When your structural surveyor/mortgage broker/solicitor tells you that the evidence of a small amount of "historical movement" in your prospective property purchase is no big deal, do not believe them. I did, and now I'm a household insurance pariah.
The only excuse I can offer is that I was a first-time buyer. Having never purchased a property before, I relied on the advice of the numerous experts to whom I was writing equally numerous cheques.
Infuriatingly, I was also incredibly cautious. I had a full structural survey rather than just a homebuyers' survey. I had an engineer's survey, just to be sure. Each commented that there had been some "movement" in the property's foundations at some time in the past. They noted that this movement was not current and that no further movement was expected to occur.
This was extremely common, particularly London, the experts told me. Pretty much every house over 100 years old in south east England has some of it, they said.
My mortgage broker was certain I'd have no trouble getting household insurance. My solicitor was satisfied with the insurance certificate supplied by the previous owner, who happened to still own the flat above the one it was selling to me.
They were all wrong."Movement" is subsidence, and insurers hate subsidence. I owned my new property - actually a ramshackle two-bedroom flat in East London, but, hey, it's my first go at this home-owning thing - for three weeks without household insurance because I simply could not find someone to insure me.
Every night I went to bed terrified that the property would burn down and my hard-earned deposit would go up in smoke.
My ground-floor flat is part of a Victorian end-of-terrace house that has been divided for many years into two separate residences with their own front doors.
HSBC was happy to insure both when they were owned by the same person under the same freehold.
But, it turns out, once the freehold had been divided into two and one flat sold to me, it didn't want to insure my flat. Despite the fact that it was one of the same two flats it had happily insured.
And despite the fact that it happily continued to insure the flat above, in the same house, with the same subsidence. Nope, I don't get it either.
I phoned the AA, reasoning that it has such a wide panel of insurers, one of them must consider offering cover to houses with subsidence. No chance, the AA call centre guy told me, none of our insurers will touch a house with subsidence.
OK, things were getting desperate. I went back to my mortgage broker, who recommended that I try his company's insurance broking arm. No luck - its call centre girl said that it had a few Lloyd's insurers they could try but she wasn't optimistic and it could take weeks, she warned.
I went to the Subsidence Claims Advisory Bureau. No luck there either - it only does whole houses, not houses made into flats. I went to my mortgage provider, the Portman Building Society. It was so confident that the house would not fall down, it was willing to lend me money to buy it, but the insurer that it gets its white-labelled cover from, AXA, won't cover houses with subsidence, not even ones that the Portman effectively owns.
By now I was getting a little teary, wondering how, despite being the world's most anally-retentive first-time buyer, I had managed to buy a house that was uninsurable.
I decided to give the broker that obtained the insurance from HSBC for the original owner one last try. Luckily for me, a genius named Julie Eborell of Heath Lambert's Key Connect operation answered the phone.
For four days Julie accepted hundreds of pages of faxed surveyors' reports, phoned me several times a day, pulled strings and called in favours. She talked an underwriter at Norwich Union into coming up with the goods.
He duly did, at more than double the cost the previous owner of both flats had been paying HSBC. By that point, I didn't give a damn - I was ready to pay anything.
The ABI doesn't know how many homeowners cannot get insurance because of problems with subsidence. It reasons that it can't be too big a problem or it would have heard about it.
The only conclusion I can reach is that, if subsidence is as common as every property expert tells me, there are a whole load of people lying to their insurers or a lot of insurers turning a blind eye to subsidence.
After all the articles I've written urging readers to be honest with their insurers, it made me sad to find that when I did, I ended up regretting it. If I'd never bothered getting a survey, I'd be halving my insurance costs right now.
It also made me wonder about the existence of intelligent underwriting. How can it be that an underwriter refuses to differentiate between a house currently stricken with severe subsidence and one that has had a small amount of movement in its foundations more than 50 years ago?
This is what I get for trying to be a grown-up. One big headache. IT