After his insurer initially accepted the claim and then denied it the day before his family moved into temporary housing, the homeowner has received the full compensation for his non-financial losses.
A dispute decision found that the damages were caused by roof leaks from an earlier claim.
He filed a claim for damage in multiple areas of his home, such as cracked tiles in the garage and mouldy black spots in the kitchen. The storm and faulty repairs to the roof caused the damage, he says. In 2021 the insurance company had changed the roof due to hail damage.
According to the Australian Financial Complaints Authority’s (AFCA) decision, IAG initially agreed with this claim but later decided it was an incorrect and denied.
According to the complainant, the insurance company had told the family that the house was unlivable and to leave. The family spent one month moving their belongings, finding alternative housing and paying the bond.
On the day of their move-out, the complainant claims that they were informed the claim was denied while the possessions they had were being moved.
AFCA orders that the insurer pay compensation of $5400 because “the insurer failed to provide an adequate reason why it initially accepted the claim and later changed its mind.”
IAG also had to pay for the claim.
According to the ruling, an IAG appointed roofer examined the property last June and found that the flashings were installed incorrectly and the soaker trays in the bedroom and kitchen had poor craftsmanship. This caused the water infiltration. Roofer stated that there were “no visible signs” of storm damage to the areas in question.
IAG acknowledged that it had made mistakes with the 2021 roof replacement and finished work to replace it once again. The roof was inspected by a builder on February 24, and despite being repaired, there were still issues with rain water ingress.
The insurer denied that an isolated storm could have caused such damage. It would not have been covered otherwise.
According to a report by the engineer of the insurance company, referred as MC in the report, the raised floor tiles were consistent with the normal movement caused by increased moisture. MC said there was no evidence that moisture had entered the area and attributed damage to a shortage of articulation joint in the tiles.
MC disputed as well that a single localised leak on the roof could have resulted in as much damage reported.
The complainant disagreed with MC after providing evidence that there were multiple roof leaks. AFCA argues the poor repair work of the insurance company was to blame.
AFCA said it didn’t find MC’s report convincing as it failed to “adequately take into consideration” other information available from other experts. This included a restorer referred as LR who stated that the tiles were lifted because of increased moisture on the subfloor.
I accept that any leaks in the roof were caused by the insurance company’s poor repairs, which necessitated a replacement. AFCA stated that MC did not adequately consider this information.
I also don’t think MC considered other information about the high readings of moisture in several rooms highlighted in LR’s report.
The expert report of the complainant, referred as BS in the report, included images that showed “substantial proof” that roof leaks had caused water to flow down the interior wall frame.
BS said that the ingress of water eventually led to the growth of black mould around the frame and suggested all loose tiles should be replaced.
AFCA accepted that BS’s report was more consistent with roofers’ and restorers’ findings, and therefore a better explanation for the loss.
IAG was required to provide a detailed scope of works to fix all the damage claimed, since it was caused by IAG’s negligence in relation to the failed roof repairs.
The PDS outlines that the insurer offers a lifetime warranty on repairs it authorizes,” AFCA stated.
The insurer replaced the roof but did not repair the damages to the property caused by the damaged repairs.
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