Can I get the payout in cash instead of having the damage repaired?
As a rule, yes. The law says that the insurer makes the payout and can only repair or replace the item instead when the nature of the insurance allows it and the insured consents. Many home insurance policies say that the insurance company can choose. The point is disputed, but if that clause is not highlighted and signed separately, there are good arguments for demanding the money. If you claim against the insurer of the person who caused the damage, you are entitled to be paid in cash.
Alburquerque Abogados
José Manuel AlburquerqueHow much you are paid
- What the damaged property was worth just before the insured event, less wear and tear, unless the policy is on a new-for-old or replacement-value basis, which is common in home insurance.
- If you take the money and do not carry out the repair, you will often not be paid the VAT. The courts disagree on whether it must be paid when the person receiving the money is a private individual.
- If the home is mortgaged and the insurer was notified of the mortgage, it needs the bank's consent to pay. If the bank does not come forward within three months of being notified of the insured event, the insurer can pay you.
If you accept the repair
Having the insurer carry out the repair has advantages, because you do not pay anything up front and you do not have to find tradespeople. On the other hand, you depend on its timescales. Ask for the quote, the timescale and the guarantee in writing. Before giving your approval, check the work and complain in writing about anything that has been done badly. If the repair is delayed, the insurer also owes late-payment interest.
If someone else caused the damage
What you claim from the insurer of the person who caused the damage is cash compensation covering all the damage. You decide whether to have it repaired and where. You do not have to accept repairs by that insurer's tradespeople. The insurer will normally pay the reasonable cost of the repair.
This answer is provided for educational purposes and offers initial guidance on the question raised. Every matter has its own circumstances and nuances that require individual assessment. For that reason, before taking decisions with significant consequences, it is advisable to consult a professional and not to rely solely on this information. Personalised advice makes it possible to apply these explanations to the specific case and to assess the options available with greater certainty.