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

Strengthening Agricultural Insurance: Rural Affinity and Munich Re's Renewed Partnership

10 Feb 2026: Paige Estritori

Rural Affinity has renewed its partnership with Munich Re Specialty - Global Markets under a new five-year agreement, continuing a collaboration that began in 2006. This renewed alliance aims to support Rural Affinity's efforts to expand its agricultural insurance offerings across Australia and introduce new products leveraging technology and innovation. - read more

AFCA Mandates Insurer Payout for Engine Overheating Incident

10 Feb 2026: Paige Estritori

The Australian Financial Complaints Authority (AFCA) has recently ruled in favour of a truck owner whose insurance claim was initially denied following an engine overheating incident. This decision underscores the complexities surrounding insurance claims related to driver negligence and mechanical failures. - read more

AFCA Supports Insurer in Truck Theft Claim Denial

10 Feb 2026: Paige Estritori

The Australian Financial Complaints Authority (AFCA) has recently upheld an insurer's decision to deny a truck theft claim, citing misrepresentation of the insured's insurance history. This ruling highlights the critical importance of accurate disclosure when obtaining insurance coverage. - read more

AFCA Sides with Freight Company in Dangerous Goods Disclosure Case

10 Feb 2026: Paige Estritori

The Australian Financial Complaints Authority (AFCA) has recently ruled in favour of a freight company in a dispute over the disclosure of transporting dangerous goods. This decision provides valuable insights into the obligations of transport companies regarding insurance disclosures. - read more

Click for more Insurance News

Business Insurance Articles

The Impact of Environmental Liability on Australian Business Operations

In today's ever-evolving business landscape, the significance of environmental sustainability and legal accountability is increasingly paramount. Australian enterprises, in particular, are encountering a growing need to understand and manage environmental liability. This reality not only influences corporate image but also carries substantial financial and legal ramifications. - read more

Critical Risk Management Strategies for Every Australian Tradesman

Welcome to the crucial world of risk management for Australian tradesmen. Whether you're a seasoned professional or just starting, understanding and mitigating the inherent risks in the trades industry is paramount to both the safety and sustainability of your business. This article intends to guide you through the world of risk management, emphasizing the pivotal role of liability insurance. - read more

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

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

Rider:
An optional provision added to an insurance policy that provides additional benefits or coverage.

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.