VAT on buildings insurance settlement


Apologies if this is a stupid question but this is the first time I’ve ever had to make an insurance claim!

We recently suffered water damage from a leaking tap in our kitchen which has meant the whole floor and part of our kitchen base units have been damaged. Insurance company have accepted liability and have actually been more helpful and prompt in settling than I imagined!

They’re only going to settle on a like-for-like basis (which I appreciate is just how it is in insurance claims) so I was asked to get a quote for replacing some kitchen base units in the closest style I could find. I got a quote from a local kitchen company which the insurers have subsequently agreed to pay (where the quoted cost for the units included VAT). The insurers settled quite quickly but minus the VAT element.

Now I understand why as obviously no VAT has been paid at this stage, but I don’t really want to go ahead and buy these actual base units as they won’t match the existing undamaged wall units. I appreciate they’re not going to care about that so I’m going to have to foot most of the cost of fitting a whole new kitchen.

But if I go ahead and buy a whole new kitchen (I think it’s called ‘betterment’?) can I get them to pay the equivalent VAT element of what they would have been liable for had I just bought the closest match to the damaged units? Or am I being stupid and insurance companies just don’t pay the VAT element in a settlement like this?


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