Your buildings insurance covers your septic tank.....but will your insurer pay out?

Septic tank damage | By Sam Warren

Here at UKDP, a big part of what we do is managing insurance claims on behalf of property owners when their septic tank (or other off mains drainage system) becomes damaged. Most people don't realise that you don't need specific septic tank insurance - in fact, such a thing doesn't really exist. Most homeowners, often without even realising, already have cover for any damage to their septic tank as standard within their existing buildings insurance policy. So you can sit back and relax, safe in the knowledge that your insurer will cover the costs to repair or replace your system if you start to have septic tank problems. Right?

Unfortunately, this isn't always the case. You see, the biggest problem with septic tanks is that they are underground. Well, of course it's not a problem in the sense that no-one wants a septic tank as a special feature in the garden. But it is a problem when it comes to being asked to explain to an insurer exactly what has happened to cause the septic tank to become damaged. Short of sitting in your septic tank with a video camera just in case something might happen, it's a pretty tall order to provide 'evidence' of what has happened. And yet some insurers will push for 'evidence' of exactly what's caused any damage to be provided when assessing a claim, and others will turn a claim down if it can't be provided.

Let's get one thing straight. Your insurance policy isn't there to pay out to fix or replace your septic tank in all situations. The cover for your septic tank or other off mains drainage system usually sits in the section of your policy called 'accidental damage to underground services'. The Financial Ombudsman Service generally considers 'accidental' to mean something that is both unforeseen and unintentional. And they usually say that a reasonable interpretation of the word 'damage' includes not only physical damage to an item but also something that resulted in a 'loss of function' - in other words, something that left it unable to perform the function it was designed to do. So, what doesn't it cover? Well if, for example, you've lived in your house for 20 years and you've never had the septic tank emptied and now you're having problems....well, you could expect short shrift from your insurer, and rightly so.

Anyway, back to the problems with insurers. Let's imagine that you've lived in your property for 10 years, you've had the septic tank emptied regularly and it's worked fine until now. Suddenly it seems to be filling up a lot more quickly than usual and you've asked someone to come out and take a look. They've let you know that whilst the tank is in otherwise good condition, there is damage to the baffle within the tank, which has broken off and is sitting in the bottom of the tank. This means that the system has stopped working and it will need to be replaced.

Even though there is very little (if any) difference from one insurance policy to another, it is a bit of a lottery as to whether or not your insurer will cover your claim. And let's be clear, this would be an entirely valid claim, as the system has suffered from damage which was unforeseen and unintentional, and which has caused the drainage system as a whole to suffer a loss of function. The reason it's such a lottery? Because insurers use a variety of different companies to help them to assess claims, and because these companies vary hugely in their appetite for accepting (or, more importantly, not accepting) claims. As a general rule of thumb, and in our experience, if your insurer appoints a loss adjuster, you will usually be treated fairly. Loss adjusters aren't drainage experts, but they are experts in policy cover and how claims should be assessed. If your insurer appoints a drainage specific company to assess your claim, well then you really are in the lap of the gods.

Unfortunately, because your septic tank is underground, it is pretty much impossible for you to prove what's caused the damage. The companies that some insurers use might jump on this, and instead put forward their opinion that the problem has happened simply because your tank has reached the end of its useful life. Your insurer then turns your claim down on the basis of this opinion.

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