In February 2015 Leigh Day called for an overhaul of the regulations governing Cavity Wall insulation (CWI) Industry following an influx of concerned homeowners, landlords and surveyors getting in touch with us about property defects such as damp and mould, allegedly caused by inappropriate or incorrectly installed CWI.
Property owners were particularly frustrated by poor service standards by CIGA – the largest provider of guarantees for retrofit wall insulation in the UK. A growing number of consumers, who were assured that their CWI was guaranteed for 25 years, were left with properties that they say had left them ill, were unable to sell, or which cost them a great deal to rectify.
John Denham MP spoke in 2015 about unacceptable practices in the CWI industry and demanded “an honest appraisal of the technology; where it works and where it does not and effective redress of victims”.
He also challenged the independence of CIGA- which he described as an organisation “led almost entirely by directors of insulation companies”. He requested that the then minister for the Department of Energy and Climate Change, Amber Rudd MP, arrange a full inspection into the operation and management of CIGA, identify the relationships between CWI suppliers and CIGA’s directors and establish an independent body to oversee compensation arrangements.
In response to mounting pressure from consumer groups and affected homeowners, CIGA launched a Change Programme to tackle problems faced by people who had been affected by failing CWI. CIGA’s 2016 annual report gave details of the steps taken by CIGA in 2015 and 2016 to improve industry practice.
Part of the Change Programme included the appointment of Teresa Prichard as an independent Consumer Champion. She was invited to bring a ‘consumer voice to the CIGA Council, liaise with consumer groups to ensure CIGA is kept informed of their concerns and assist with the resolution of consumer complaints.’
She consulted with energy giants, consumers and CWI providers to see how CWI practices could be improved. She reviewed hundreds of cases, and in particular 11 consumer cases, to identify current problems, and recommend steps for improving practices, including instances where installers had failed to meet good standards of installation.
Her recommendations included customer service targets to resolve 80% of cases within 20 working days, to publish a ‘fit for purpose’ corporate vision and adopt a standard to resolve customer complaints within 1 month. The 2016 Annual Report confirms that 76% of customers surveyed felt CIGA were helpful and that 4 new customer service agents and a new CRM system and technical inspector would help them achieve a target to resolved 80% of cases within 20 working days.
The consumer champion recommended that CIGA reinforce their independence and CIGA report that they have implemented an independent Alternative Dispute Resolution (ADR) scheme. The Centre for Effective Dispute Resolution (CEDR) is now its named provider (a Chartered Trading Standards Institute approved ADR body). This scheme came into effect on 1 April 2016.
Recommendations also included a need for transparency about the activities of CIGA and their role in dealing with companies that were non-compliant in a bid to actively assure consumers that they were preventing the same problems from reoccurring. CIGA have responded by creating a Best Practice Guide and publishing 2 installer league tables. They have also agreed to provide quarterly reviews to measure progress and be open about the type of problems reported. League tables will also be published to assist consumers in making informed choices about the companies they wish to use. In addition, 3 new non-executive representatives have been appointed to widen the experience of the board in areas such as consumer care, financial accountability and regulation.
CIGA reports that 836 matters are currently ‘open’ of the 2577 claims received in 2015. 233 of these are being resolved by CIGA and 603 are being resolved by the installers under the terms of the agreement.
CIGA report that they spent £908,351 on rectification works in 2015 alone, excluding cost of investigations compared to a spend of £510,000 in 2014. CIGA report an average cost of rectification is estimated in the region of £1400; however, having spoken to a growing number of homeowners contacting us about rectification costs, we understand costs to be significantly higher in many cases, depending on the level of damage caused and the type of property that has been affected. As CIGA limit their liability under the guarantee to £20,000, many consumers can still be left out of pocket.
CIGA’s turnover in 2015 was £2,458,956 (all of which were guarantees). Despite a reduced number of CWI installations in 2015 compared to 2014 a significant number of affected homes will need investigation to ensure that the CWI is working at lowering bills and keeping people safe and warm and not causing harm.
I welcome the progress reported in the 2016 Annual report and re-inforce that CIGA delivers on their contractual and statutory obligations under the scheme as guarantors. I hope that it continues to improve in providing the service it promises and recommend that anyone affected by poorly or inappropriate installed CWI to contact their guarantor or their installer for recourse.
If you do not obtain a satisfactory outcome, as reinforced by CIGA’s terms of guarantee, your statutory rights are not affected and you can purse a claim for damages under consumer and contract law.