Insurer's Flood Exclusion Overturned on Claimant's Photo Evidence

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The homeowner submitted her claim on March 2 of last year, following a week-long period of water entering her property, resulting in damage to her home, its contents, and a shed. Reports confirmed that the water had reached a level of more than 80mm, impacting the flooring, walls, fittings, and furniture.

The claimant strongly argued that the water was stormwater run-off, presenting photographic evidence to the AFCA panel depicting clear water surrounding her house. In addition, she referenced rainfall data from a nearby weather station, which recorded multiple instances of intense rainfall between 12am and 9:40am on February 28.

Allianz, the insurer, rejected the claim based on findings from a hydrologist employed by the company, identified as "W". According to W's report, the inundation was attributed to floodwater from the nearby Richmond River, situated approximately 550m away from the property.

Challenging W's findings, the claimant noted that the river's gauge station recordings indicated a peak water level of 22.89m above average sea levels at 7:30pm on February 28. This level was only slightly higher than the property's recorded ground level of 22.63m. The gauge readings also showed a gradual increase from 19.92m to the peak levels between 6am and 7:30pm.

Recognizing discrepancies in W's report, AFCA acknowledged that the hydrologist's measurements, placing the property at 21.08m above sea level, were approximate. Instead, AFCA preferred the claimant's recorded level, obtained from specific site records maintained by the local council.

The panel found that, while the home had indeed been affected by floodwaters at some point, W's report failed to address whether the initial inundation originated from the Richmond River.

"W's report does not provide any insight into when the river may have breached its banks or how the water would have entered the property," stated AFCA.

Furthermore, AFCA noted that W did not acknowledge or address the claimant's evidence, including the photographs clearly illustrating the property being surrounded by relatively clear water in the morning of February 28, around 10-and-a-half hours prior to the river's peak levels.

Based on the available recordings, AFCA concluded that it was difficult to infer that the floodwater, which only slightly exceeded the property's ground level, was responsible for the initial inundation.

"While it is undisputed that storms caused the claimed damage," explained AFCA, "the insurer's reliance on the flood exclusion cannot be upheld since it has failed to establish that the claimed damage was caused by flood or any other excluded cause."

For the official ruling, you can access the document here.

Published:Tuesday, 7th Nov 2023
Source: Paige Estritori

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