Quake Damage Claims Dismissed Over Previous Faults
Quake Damage Claims Dismissed Over Previous Faults
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.
Two farmhouses seeking insurance payouts for earthquake damage have had their claims denied, following a decision highlighting the role of pre-existing issues.
The company behind the claim stated that the properties were impacted by a 5.4-magnitude earthquake that occurred in November 2018. Although the earthquake's epicenter was approximately 45 kilometers away from the buildings, Geoscience Australia specified the evident damage radius to be no more than 27 kilometers from the epicenter.
In their defense, the claimant's engineering expert conceded that the buildings were situated outside the primary damage zone but contended that the earthquake’s vibrations had unleashed energy beneath the geological formations on which the houses stood.
The expert identified "preexisting or dormant conditions" in the properties, including previously repaired damage which, according to him, reopened due to ground movement prompted by the quake, also leading to the manifestation of new fractures.
Meanwhile, Allianz, the insurance provider, enlisted a forensic civil and structural engineer who assessed the damages. His findings revealed brickwork fissures in multiple sections of one property, referred to as House H, and evident cracks within the garage of the second property, termed House P, in addition to a separation between a storeroom and the home.
The engineer hired by Allianz attributed the damage to prolonged foundation instability and deterioration of the mortar used in the brickwork, rather than to the seismic event.
The Australian Financial Complaints Authority (AFCA) upheld the insurer’s position, noting that both engineers corroborated the presence of damage similar to what was being contested even before the 2018 earthquake, specifically in House H.
AFCA further mentioned that updates made to certain rooms within the house remained unaffected, while external brickwork conditions pointed towards significant wear and tear, contributing to the losses. Comparable remarks were also made in regard to House P.
"While both experts agree it is conceivable for House H to incur earthquake-related damage under ideal conditions despite its location outside the designated impact radius, the insurer's expert refuted the existence of such conditions in this case," stated the adjudicator from AFCA.
"Even if the earthquake were recognized as being a proximate cause of the damage to House H, it would coexist with other excluded factors (wear and tear, prolonged structural movement)."
"Consequently, the insurer maintains the right to invoke those exclusions as a basis for denying the claim," AFCA concluded.
Please Note: We do not endorse any specific products or companies. Some content is sourced from third parties, including press releases, and may not be independently verified for accuracy or completeness.
The Australian trucking industry is currently grappling with an unprecedented surge in fuel prices, a situation that has placed many operators on the brink of financial collapse. Recent reports indicate that diesel prices have escalated from approximately $1.65 per litre to between $2.70 and $2.90 per litre within a mere three-week period. This dramatic increase has significantly impacted the operational costs of trucking businesses nationwide. - read more
Western Australia's transport industry is advocating for significant reforms to the state's heavy vehicle licensing system, aiming to enhance road safety and ensure that drivers possess the necessary skills and experience to operate large trucks. This push for stricter licensing standards comes in the wake of South Australia's recent implementation of more rigorous conditions for obtaining multi-combination (MC) licenses, following a tragic triple fatality crash in 2024. - read more
The Australian Prudential Regulation Authority (APRA) has recently implemented emergency regulations aimed at addressing escalating concerns within the commercial auto insurance sector. In response to widespread industry protests over substantial premium increases, APRA has taken decisive action to protect independent transport operators and logistics enterprises from potential financial distress. - read more
The Australian insurance industry is currently grappling with a complex landscape marked by escalating premiums and declining profits. This trend is largely attributed to the increasing frequency and severity of natural disasters, coupled with rising operational costs. - read more
Despite facing a volatile risk environment, Australia's non-life insurance sector has demonstrated remarkable resilience, with leading insurers reporting substantial revenue growth. According to AM Best's recent analysis, the top 10 non-life insurers in Australia collectively achieved nearly $46 billion in insurance services revenue in the latest fiscal year, marking an 11.1% increase from the previous period. - read more
Car insurance is an essential expenditure for any vehicle owner, but are you truly aware of all the costs involved? Many Australians focus solely on the premiums, overlooking additional charges that can significantly impact their budget. Understanding these hidden costs is crucial to avoid an unpleasant surprise. - read more
When it comes to car insurance for new drivers in Australia, navigating through the options can be overwhelming. Understanding the various factors that impact insurance premiums is crucial for making informed decisions. - read more
Car insurance is a critical component of responsible vehicle ownership in Australia. With roads bustling with diverse traffic, from urban highways to outback tracks, safeguarding your journey becomes indispensable. However, the complex world of car insurance can bewilder even the most astute driver. This article embarks on a quest to demystify the process of comparing car insurance quotes, aiming for not just coverage, but substantial savings too. - read more
Car insurance is a necessary expense for anyone who owns a vehicle. It provides financial protection against accidents, theft, and other unexpected events. In Australia, having comprehensive car insurance can save you significant costs down the line. However, what many drivers may not realise is how their driving habits can directly influence their insurance premiums. - read more
Knowledgebase
Deductible: The amount you must pay out-of-pocket for expenses before your insurance company covers the remaining costs.
