Like many conditions for rental insurance, I found Tower’s questions to be unreasonable.
The following is an email I sent to Tower Insurance to clarify some concerns I had about their compulsory disclosure statements you will see on your policy statement.
Customer Number: 210XXXXX
My rental properties are insured through Tower and I am concerned about the section under “The Following Disclosures Have Been Provided” that appear on the renewal summaries that I receive.
I have requested multiple times over the past 2 or 3 years that the “No” answers listed on the summary be removed, as I am unable to say “yes” or “no”. Despite this, they are still there.
Various customer service representatives have claimed that they;
- Don’t apply to rented properties.
- Don’t really mean anything.
- Are “to the best of my knowledge”.
- Wouldn’t affect a claim anyway.
However, this was never reassuring, as I felt Tower should provide documentation that was correct and accurate.
Today, a customer service rep advised me that the answers could not be removed and were binding – on advice from her supervisor. When I pointed out that Tower was forcing me to answer “No” to a question I had said I could not answer, we went around in circles for another few minutes until I realised logic wouldn’t work.
According to the policy documents, I am required to answer any questions that you ask, and my answer to all these disclosure questions on all policies regarding tenants or other people living at my rental properties is “I don’t know”. Does Tower have any issue with that?
A Tower Insurance Processing Administrator Replied…
Thank you for your email regarding the disclosure clauses relating to your properties insured with us.
The notes on your policies show that you called on 10th January and were advised that you need to answer these questions on behalf of the tenants. The important issue here is that you will have the information in writing and if there is a claim we will have evidence to show that you asked the tenants and their answers are signed on the agreement.
Tower expects you as the owner of the property to take all care and responsibility when establishing the tenancy and the therefore made enquiries with the individuals concerned to obtain this information. To make it easier for you these questions can be added to the Tenants Agreement. It will help you have the best possible tenants and lower the risk of having trouble in the future and also Tower having the correct information to accept the risk with the correct information at hand.
I hope this clarifies the matter for you. If you have any further queries please do not hesitate to contact us.
I replied…
Yes, as I said in my email, I *was* advised of this on 10th January but prior to that, I had raised the issue at least twice over the previous 2-3 years and was not told this. In fact, I was given advice to the contrary on prior occasions and again on 10th January until your representative sought advice from a supervisor.
The important issue here is that you will have the information in writing and if there is a claim we will have evidence to show that you asked the tenants and their answers are signed on the agreement.
Why would you assume I have that information in writing? Actually, this is not the case at all and would not be for 99% of landlords. The Department of Building and Housing Tenancy Agreement, which most landlords would use, does not include questions relating to;
• Previous insurance claims history
• Criminal history
• Bankruptcy
Given this, I have some questions for you;
1. Would Tower honour a claim for damages by the tenant (such as a fire caused by marijuana oil manufacture) if the tenant turned out to have drug convictions and the landlord could not prove that they had asked the tenant about their criminal history?
2. Does Tower require that the landlord inform them of any new tenants and update the answers?
3. How do these questions apply in regard to non-tenant, permanent residents? A tenant may legally sub-let a property without informing the landlord and the landlord has no “business” with the new sub-letting tenant.
4. What answer will Tower accept if the tenant or permanent resident refuses to answer any questions?
Thanks for your help.
Then Tower Insurance Phoned me…
I spoke with a very helpful Team Leader from Tower’s Claims department. Who was able to clarify the situation for me as follows, via email…
Just to confirm as per how conversation this morning that you are not required to have your tenant fill out the declaration questions listed in your policies.
The answers in the clauses are for you as the insured to answer, and unfortunately we are unable to change the wording of the clauses to make more since with regards to tenanted properties at this time.
Please note you have a duty to complete standard checks when entering a tenancy contract and are obligated to let us know of anything you are aware of. Also to report anything unusual or damage proceeding one of your regular inspections of the properties.
Below are the answers to your questions:
Would TOWER honour a claim for damage by tenant (such as a fire caused by marijuana oil manufacture) if the tenant turned out to have drug convictions and the landlord could not prove that they had asked the tenant about their criminal history?
Every claim is consider case by case basis and all factors considered. If you had taken all due care and completed your normal tenancy checks prior to the tenancy agreement and completed regular inspections and the fire was accidental then we would consider it under your policy. In general terms we would not decline a claim based on information that you as the landlord would not reasonably be expected to know
Does TOWER require that the landlord inform them of any new tenants and update the answers?
No
How do these questions apply in regard to non-tenant, permanent residents? A tenant may legally sub-let a property without informing the landlord and the landlord has no “business” with the new sub-letting tenant?
We would treat all permanent residents as tenants with regards to any claims so long as they are legally at the property
What answer will TOWER accept if the tenant or permanent resident refuses to answer any questions?
If a tenant refuses to answer a question this should cause concern for yourself, as they could potentially be a risk to yourself, however this is not an issue for TOWER to address as we do not require your declaration questions to be answered by the tenant.
What wasn’t mentioned in the email above, was that Tower is limited by their computer systems and they are in the process of upgrading them. This might sound like a poor excuse but it was years before they were able to identify separate properties by anything other than their own reference numbers on their invoices, so in this case, I believe them. Since writing this article, I’ve shifted everything to Crombie Lockwood and use Vero. I believe Tower have a good record for paying out but I found dealing with their systems too difficult!
