A homeowner has won a water damage payout after the dispute authority agreed the problem was caused by a shower pipe leak.

An Allianz-appointed builder had blamed deteriorated seals in the upstairs bathroom’s shower recess, and said the damage to a wall downstairs probably occurred over about 12 months. 

They said the claimant should have been “reasonably aware” of it, given there was black mould in the area. 

The insurer’s plumber said the damage was probably building for about six months and stemmed from the deteriorated shower base and unsealed taps.

Allianz declined the claim, saying its policy did not respond to gradual escape of water from a shower base, recess, alcove or where a “reasonable person could be expected to have been aware of [the leak]”.

But the complainant said her plumber found a leak in the shower breech – pipework between the taps and the outlet – that the insurer’s experts missed.

Her plumber used a yellow dye to check if there was leakage from the recess, and found only clear water in the downstairs area.

The Australian Financial Complaints Authority says the dye test indicates the damage stemmed not from the shower recess but from the breech.

“I acknowledge such a [breech] leak should have been observed by [the insurer’s plumber] at the time of its inspection,” an AFCA ombudsman said.

“However, the failure to find it is not reason alone to conclude the damage only arose later.

“The complainant says she offered to permit the insurer ... further access to review the shower breech damage. The insurer did not respond to this offer.”

While AFCA does not “discount some water might also be escaping from the shower recess, [the complainant’s plumber’s] tests imply such egress was likely minimal”.

It says Allianz must repair the damage or provide a cash settlement with a 15% contingency uplift. The insurer does not have to address the shower faults.

See the ruling here.