Tenants & Landlords - FAQs

Claims |Exclusions |General | All

FAQs - Claims

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CMP does not offer a ‘for whatever reason’ guarantee. The guarantee extends only to loss by theft of client monies by the principle or owners of the business. For the purpose of doubt, theft means the dishonest obtaining of money with the intention of permanently depriving the client of such money. When considering whether a claim under the guarantee is valid or not, CMP will need to ascertain whether theft of client monies, and therefore a crime, has taken place. CMP will not accept claims where the agent merely refuses to return monies and those monies are clearly still in the custody and control of the agent.

The financial guarantee provided by CMP is limited to the insurance we have purchased. This is the same for all CMPI schemes, although this fact is not always made as transparent as it should be. As with all insurance protection there must be limits put in place and our job as risk takers is to manage these limits. Using our knowledge of the lettings market and our experience of operating similar CMPI schemes in the tenancy deposit world, we feel that the limits of our guarantee are adequate to meet the claims of those landlords and tenants we seek to protect. The limits are: - £500,000 any one loss/incident - £25,000 any one landlord/tenant - £5,000,000 in the aggregate per 12 month period of the guarantee.

FAQs - Exclusions

The main exclusions are as follows: 1. Theft of client monies by an employee of the business. CMPI is designed to protect clients from theft of money by the owner of the business. Theft of client monies by an employee of the business is still the responsibility of the employer and therefore it is the responsibility of the employer to protect the business against this type of risk. CMP requires all its members to hold Professional Indemnity Insurance that will pick up this type of theft. Landlords and tenants will be directed to make a claim against the letting agents’ PI policy. 2. Theft of monies by the owner owed to another owner. CMP will not pick up any claims where one business owner misappropriates monies owed to another owner. 3. Theft of monies by a third party. CMP will not honour any claim where theft of client monies is undertaken by any person not connected with the letting agent. For example, monies held by tradesmen, financial institutions or other businesses. 4. Theft of monies already protected/held by an authorised Tenancy Deposit Protection Scheme. CMP will not pick up claims which relate to tenant’s deposits that are protected by a government authorised tenancy deposit protection scheme, whether the scheme is a custodial scheme or insured-based scheme. CMP will only honour claims if the deposit schemes’ Membership Rules are exhausted or not applicable e.g. the deposit was never protected or the scheme cannot or will not honour the protection of the deposit. If the deposit is clearly protected, or held in a custodial scheme, the claimant will be directed back to the relevant deposit protection scheme. CMP will not accept claims from an authorised Tenancy Deposit Protection scheme to offset its liability.

FAQs - General

Client Money Protection Insurance (CMPI) is a distinct insurance that protects the money of landlords and tenants against theft or misappropriation by the owners of the letting agent whilst it is in their custody or control. These monies are frequently tenant’s deposits and landlord’s rental payments but can also include monies held for repairs and maintenance to the property and other such circumstances. CMPI is purchased by the letting agent for the benefit of his clients (landlord or tenant). In the event of theft or misappropriation of these monies by the owners of the business, landlords and tenants have a route of redress against the letting agent by contacting the ‘policy issuing’ body/organisation and claiming against the policy. If a genuine claim is accepted, the ‘body/organisation’ will recompense the landlord or tenant and seek recovery from the letting agent or its owners.

Traditionally, the provision of CMP has been made available through letting agent trade bodies or organisations such as RICS, ARLA, UKALA or NALS. These organisations provide CMP to their members, publicise the benefits to the wider community, and deal with any claims made against the scheme. Without the inclusion of this independent entity within the CMP sale process, the landlord and tenant risks not knowing about the existence of CMP, the terms and conditions of the insurance, who to contact and how to make a claim – especially if the agent has gone into liquidation and is un-contactable.

No, CMP does not act on behalf of the letting agent. It is an independent membership body that provides the protection of client money whilst held by its members and the Scheme insures its liability for the payment of any claims.

Complaints can only be made about the process or service provided by CMP. The majority of complaints will be dealt with within 5 workings days. Please see the CMP Complaints Procedure.