Consumer Watch: ‘Acts of God’ are fraught with legal complexities

Published on 21/07/2012 14:40

TO my fellow learned riends within the Scottish legal profession it is Damnum fatale, but most members of the general public know it as act of God.

Given some of the consequences of our sustained bout of wholly unseasonal weather, this is a term which must have exercised the minds of many members of the population lately.

The insurer RSA, which is
behind the “More Than” brand, has revealed that it had taken a £50 million hit after the dire summer weather across the UK resulted in more than 6,500 claims since June alone. Mid-month statistics released by the Met Office showed that in the first two weeks of July, Lothian saw 105.8mm of rain, some 167 per cent of the monthly average.

Meanwhile, this tearing-up of the climatic rule book begs the question that with the climatic conditions experienced during June and July normally associated with mid-winter, does it mean that any insurance claim for damage to a house or, say, a car is less likely to succeed
because said damage occurred as a result of freak weather for the time of year?

It would be very odd if an
insurance company refused to honour claims made under the typical buildings and contents insurance policies on the basis that the damage was caused by an act of God, because that’s the very thing the policyholder is insuring himself against – ie floods and storms per se, and not just in winter. However, some insurance policies, particularly related to motor vehicles, do have act of God exclusions, in which case if your car is not insured against this eventuality and is then swept away in a freak flood, you will almost certainly not get compensation. As with all forms of insurance, the rule is simple – read the policy before you sign it and make sure the terms provide the level of cover you consider are appropriate to your needs.

Homeowners who live in a floodplain or simply consider the place where they live has been subjected to exceptionally heavy rainfall should be especially vigilant about the clauses in their policies and any changes made by their insurers.

The majority of owner-occupiers will have a buildings insurance policy (made obligatory by most lenders for those with an outstanding mortgage) in addition to home contents insurance, often from the same insurance provider. However, the situation is different for the increasing numbers within the population who are living in
privately rented accommodation. Should freak weather conditions cause damage to a rented house or flat, this will be covered by the landlord’s building insurance, but the tenant will need to have home contents cover to compensate for any damage to
personal possessions.

Victims of the weather who do not have insurance – or whose insurance policy turns out to be inadequate – could investigate whether someone else is to blame for their loss. For example, if your home has been damaged by a flood caused by the collapse of a sewer, it may be possible to reasonably claim that it was the responsibility of the local authority to maintain this piece of infrastructure.

As a general rule, the only def­ences would be the event was caused either by the action of a third party for whom they were not responsible, or by a damnum fatale. Damnum fatale (which is, clearly, from the Latin) is essentially some event which could not have been anticipated by any reasonable human foresight.

An unusual volcanic eruption is one phenomenon that could come under the category of act of God but it really boils down to time and place. A long-extinct Arthur’s Seat suddenly erupting could reasonably be described as an act of God. But it might not apply to a similar happening in Naples, which lies in the shadow of a still-active Mount Vesuvius.

A somewhat extreme example, perhaps, but it does serve to explain the complexity of this area. Most outcomes will be dependent on individual circumstances, and, taking legal advice may be the only practical option.

• Richard Godden is an Edinburgh-based partner with the law firm Blackadders