Lawyers acting for families affected by Europe’s worst peacetime fire in 2005 say the oil company has yet pay damages

Four years on from the Buncefield oil depot explosion, reckoned to be the largest peacetime fire in Europe, lawyers representing 275 locals say that only “between 15 and 20″ of their claims have been fully settled by the oil company responsible.

Residents near the Hertfordshire site, which went up in flames after an explosion that measured 2.4 on the Richter scale, have received compensation payouts from insurers, but are still pursuing claims against the oil company Total UK for uninsured loss, personal injury, as well as for loss of earnings and falling house prices.

No one was killed in the blaze but 43 people were injured and 2,000 forced to abandon homes. Some families claim to be still recovering from the explosion that took place at 6.01am on Sunday, 11 December 2005, and was said to have been heard more than 100 miles away.

David Mitchell, a TV producer who lives with his family about 400 metres from the site , says images are “still vivid” in his memory. “The whole house was shaking and bits of ceiling were coming down. There was a huge roar that went on for ages. It was terrifying.”

Mitchell’s first response was to check on his two children (five and eight at the time) who were still in their beds, unharmed but “covered with rubble”. He then ran outside: “It seemed like there were flames 100 metres wide and half a mile high.”

In March 2009 the High Court ruled that Total would have to foot a bill of possibly more than £750m in damages for claims arising from the Buncefield fire. Chevron, the US oil giant that co-owns the site, was cleared of liability. Last month, Total pleaded guilty to two health and safety charges, as well as to polluting water.

Cash first spoke to Heidi Brazier and her husband, Carl, in December 2006 on the first anniversary of the fire, when they and their seven children, were spending a second Christmas in a hotel. Their insurer has so far paid out more than £100,000 on their property, and they are claiming a further £25,000 in uninsured loss from Total, including replacement windows, kitchen worktops and a bathroom suite.

“How can a company even contemplate running the site again when they haven’t compensated those affected by the blast they caused?” asks Heidi. “It is such an insult to us.”

Des Collins, of Hertfordshire law firm Collins Solicitors, is acting for many of the families. “Total has been and continues to be impossible to deal with as far as these claims are concerned,” he says. “We’re four years on and we have been acting for 275 people and 15 to 20 claims have settled. The trouble is they offer ludicrously low amounts of money.”

A spokesman for Total insists that 92% of the claims “are either settled or were insured, and we are working hard to resolve the remaining claims … Any suggestion that Total is in any way hindering the settlement of claims is misleading and factually incorrect.”

Collins says the Braziers’ total claim is far larger than the £25,000 uninsured loss and would include a substantial claim for loss of earnings. Carl lost his job as a senior manager at National Grid, because of a heart condition caused by blood pressure following the explosion.

Many families have been unable to sell their homes. Collins has 15 clients, including the Braziers and Mitchells, who are claiming for diminution of value in their properties as well as for pollution of the environment. Collins says Land Registry searches indicate a “13% price differential” between house prices in East Hemel, 2,00mowhere the site is, and West Hemel.

Mitchell, who has so far received about £85,000 under his insurance policy with Norwich Union Direct, says the area still looks like a war zone.

“We are not trying to make a profit but we would like some sort of compensation for the way that they have turned our lives upside down,” he says.

Despite last month’s ruling, he says, “No one has said sorry to us for allowing this to happen.”

Ashley Seager’s expensive NatWest policy failed to pay out, so he complained to the ombudsman – only for the label of quality to be dismissed as ‘meaningless’

NatWest’s travel insurance was one of the main reasons that I, like so many other of the bank’s customers, have an Advantage Private account. For an annual fee of £240 it says it is “packed with exclusive features”, chief among them its five-star Defaqto-rated annual worldwide travel insurance, which the bank claims is worth £160 alone.

Last year, I put it to the test. I took my family to Canada on holiday – only to be stranded by the collapse of Zoom Airlines. But instead of the insurance kicking in and returning us home, NatWest refused to pay out. To my surprise – and cost – it said the insurance did not cover the failure of a scheduled airline.

Furious, I took my case to the Financial Ombudsman. Surely, I argued, “five-star” had to mean that it was a fully comprehensive policy that would cover me in most eventualities – such as, in my case, a scheduled airline going bust. After all, NatWest proudly displays its five-star rating prominently over its literature for the Advantage Private account.

A year later, I have finally had my complaint judged by the ombudsman. He has found in favour of NatWest, and I won’t be getting any compensation. But the reason why I’ve been rejected makes for interesting reading. The ombudsman, it appears, thinks that the five-star ratings that financial companies use to promote their products are entirely meaningless.

“I do not consider that there is any common agreement as to what the phrase means. In my judgment the term “five-star” has no specific meaning and amounts to nothing more than “puff”,” wrote ombudsman Reidy Flynn in her judgment.

I contacted the ombudsman’s office to discuss the lack of logic, but it declined to comment. Its basic judgment is that the Natwest Advantage Private bundled account with its five-star travel insurance was not obliged, in any way, to cover for the failure of an airline, or any other transportation company. I should have read the small print, no matter how small.

My complaint had made the following points: that it was unreasonable that a five-star policy did not cover airline failure – any normal person would expect to have such a thing covered if they were travelling abroad; that it was unreasonable that such an exclusion would not be on the list of “significant exclusions” at the front of the policy; and that it was unreasonable that it should be buried in the small print.

I had tried to find out, prior to travelling, whether this point was covered but could not get through to NatWest on the phone, or find the relevant documents on its website. I could not find the documents at home, either, although NatWest insists they were sent. So I relied on the “five-star” rating, thinking it sounded good.

I have since learned that across the insurance industry not many policies cover airline failure. But the Post Office does, and that’s not an obscure little company. It would have cost £1-1.50 per person for NatWest to cover their policy holders for a year against airline failure. Was it reasonable to expect them to have done so for its premium account customers? You might think so, but NatWest did not, nor did the ombudsman.

Defaqto was bemused by the ombudsman’s comments. “I am surprised it has couched it in those terms,” said its head of research, Brian Brown. “Our ratings are independent but do not purport to offer any kind of legal guarantee of what a product may contain. People should check the details.”

He denied that banks and insurers pay a fee to Defaqto to use their ratings, implying the company was biased towards issuing “five-star” ratings. He added that the company only issued five-star ratings on 10-12% of products and no comnpany pays to appear in its analysis. The bulk of its revenue comes from a business-to-business database it compiles and sells to banks and insurers.

Perhaps, though, if the ombudsman service thinks five-star ratings are meaningless and “puff”, it, or another authority, should move to ban them? That’s the only conclusion a reasonable person could reach.