Homeowner Triumphs in Ground Movement Damage Claim

The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.

A homeowner's dispute over damage caused by ground movement due to a leaking pipe has received a favorable verdict from the Australian Financial Complaints Authority (AFCA), promising significant coverage for repairs.

The homeowner noticed cracking in a load-bearing wall on July 8, 2022, and quickly linked the issue to a leaking water main he discovered the next day. He attributed the cracking and additional damage throughout his house to ground movement from the leak.

Independent assessments commissioned by Hollard Insurance presented contrasting views. A plumber observed substantial leakage, resulting in damp conditions and soaking of nearby stumps. He suspected this might have led to slight settlement problems and further cracking within the property, particularly in the kitchen area.

Hollard's engineer, however, inspected the house roughly a month later. Their report downplayed the leaking pipe, chalking up the damage to long-term issues associated with the soil's properties, including seasonal moisture changes and environmental causes. According to the engineer, the cracking damage predated the observed leak and was related to the house's history.

The homeowner highlighted extensive renovation work conducted between 2016 and 2019 to stabilize the foundations of his 1930s-era home, including underpinning and relevelling. He noted the lack of substantial cracking until the sudden appearance of damage in July 2022.

AFCA’s evaluation supported the homeowner’s evidence that the damage in the newer parts of the house was a recent development. Video footage and the plumber's testimony showed significant leakage, undermining the engineer's less critical assessment. AFCA also questioned the conclusiveness of the engineer's floor-level survey.

"While there is a history of movement-related damage, the noted cracking around the extension did not follow this pattern," AFCA determined. According to the authority, the factors cited by the engineer involved gradual, long-term damage, but in this case, the damage seemingly appeared suddenly due to the leaking pipe.

In its final ruling, AFCA concluded that the homeowner's losses likely resulted from an unexpected, sudden release of water. Consequently, Hollard Insurance would be responsible for repairing the assessed damage or covering repair costs. However, unrelated damage not connected to the leak would be excluded from coverage.

The case underscores the importance of independent reviews and cultivates awareness about homeowners' rights amidst damage disputes. AFCA's decision shines a light on their role in ensuring fair evaluations are considered in claim disputes.

This ruling is reported with original insights from an article appearing in Insurance News.

Published:Monday, 15th Jul 2024
Source: Paige Estritori

Please Note: If this information affects you, seek advice from a licensed professional.

Share this news item:

Insurance News

Rising Mental Health Claims Reshape Australia's Insurance Landscape

10 Dec 2025: Paige Estritori

The Australian insurance industry is witnessing a significant shift as mental health conditions have become the leading cause of total and permanent disability (TPD) claims. Recent data from the Council of Australian Life Insurers (CALI) indicates that mental health issues now account for nearly one-third of all TPD claims, marking a substantial change in the industry's claim patterns. - read more

Australian General Insurers Achieve $6 Billion Profit Amid Fewer Natural Disasters

10 Dec 2025: Paige Estritori

In a remarkable turnaround, Australian general insurers have reported a combined profit of $6.1 billion over the past year. This substantial increase is attributed to a period of relative calm in natural catastrophes and robust investment returns. - read more

Australian Life Insurers Under Review for Mental Health Exclusion Practices

10 Dec 2025: Paige Estritori

Recent findings have revealed that certain Australian life insurers continue to implement blanket exclusions for mental health conditions, a practice that contravenes the industry's code of practice. This has raised significant concerns about the fairness and legality of such exclusions. - read more

Marinex Underwriting Sets Sail in Australian Marine Insurance Market

10 Dec 2025: Paige Estritori

In a significant development for Australia's marine insurance sector, Rhodian Group has announced the launch of Marinex Underwriting, a specialised agency dedicated to addressing the complex insurance needs of the marine industry. This initiative marks Rhodian's third agency launch, following the establishment of Halo Underwriting and Batch Underwriting in previous years. - read more

Click for more Insurance News

Business Insurance Articles

How to Assess Your Risk Exposure and Select the Right Indemnity Coverage

Professional indemnity insurance stands as a pivotal safeguard for Australian professionals navigating the intricacies of liability in their work life. This form of insurance is designed to protect professionals against legal costs and claims for damages arising from acts, omissions, or breaches of professional duty in the course of their practice. Whether it's due to an honest mistake or an unforeseen error, the ramifications of such professional oversights can be financially crippling. - read more

The Cost of Public Liability Coverage: Is It Worth It?

Public liability insurance is a crucial safety net for both businesses and individuals, providing protection against the financial fallout from claims of injury or damage that your business operations might cause to third parties. This type of insurance is designed to cover legal and compensation costs, safeguarding you from unexpected financial burdens. - read more

The Importance of Documentation in Public Liability Claims

Public liability insurance is an essential part of any business's risk management strategy, especially for those operating in Australia. It's designed to protect businesses when they're found legally responsible for injury or damage to third parties due to their operations. But what happens when you need to make a claim? That's where understanding the claims process becomes vital. - read more

How to Lower Public Liability Insurance Premiums Without Sacrificing Coverage

In the ever-evolving landscape of Australian commerce, business insurance stands as a crucial bulwark, safeguarding enterprises against unforeseen financial perils. Recognizing this, our in-depth exploration begins with an overview of the monumental role business insurance plays for Australian companies, both large and small. It's a cornerstone for risk management, providing business owners with peace of mind as they navigate the intricacies of their industries. - read more

Start Here !

Knowledgebase

Deductible:
The amount you must pay out-of-pocket for expenses before your insurance company covers the remaining costs.

This website is owned and operated by Clark Family Pty Ltd (ACN 010 281 008) as Trustee for the Clark Family Trust (ABN 35 957 893 714), 43 Larch Street Tallebudgera QLD 4228. Clark Family Pty Ltd is an Authorised Representative (AR 1298860) of Unique Group Broker Services Pty Ltd (AFSL 509434) for financial product referrals and an Authorised Credit Representative (ACR 401491) of Saccasan Pty Ltd (ACL 386297). Check our licensing details on the ASIC registers: Clark Family Pty Ltd ACR, Clark Family Pty Ltd AR, Saccasan Pty Ltd, Unique Group Broker Services.

IMPORTANT: We do not provide financial product advice or credit assistance. We act solely as an introducer and refer enquiries to licensed third-party intermediaries, insurers, and lenders - with whom you can then deal directly. We may receive a fee or commission from these third parties in consideration for the referral. Before any action is taken to obtain a product or service referred to by this website, advice should be obtained (from either the third party to whom we refer you or from another qualified intermediary) as to the appropriateness of obtaining those products having regard to your objectives, financial situation and needs. Whilst we have our own process for validating the legitimacy of our referral partners, you should always verify the credentials of your financial adviser before proceeding with recommendations that they may present. Visit the ASIC website for further information.