A recent case serves as a useful reminder of the need for early notification to insurers when there is property damage.

The insurance policy required the insured to give ‘immediate’ notice of any ‘injury or damage in consequence of which a claim may be made under the policy’. A survey in January 2003 identified no signs of cracking or movement, but by late summer 2003 cracks had begun to appear. By November 2003, significantly more cracking and signs of movement were evident. Cracks continued until December 2006, with most damage occurring between October 2004 and Spring 2005. The insured notified the insurers in August 2005. The court held that the obligation to notify arose in November 2003, when it became evident that repair work was necessary. As the judge made clear, the issue of whether notification should be made has to be decided objectively, not subjectively (ie would a reasonable person have considered a claim to be likely to arise from those particular circumstances?). Moreover, it should be appreciated that the wording will usually mean that the notification clause is a condition precedent.

Thus, the basic advice is to always ensure that notification is given as soon as there may be any reasonable expectation of a claim having to be made. Loyaltrend & anor v Creechurch Dedicated Ltd & ors [2010] EWHC 425 (Comm) (access free at www.practicalconveyancing.co.uk).