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Collapsed ceiling caused by defective workmanship 'not covered'

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A QBE home insurance policyholder who disputed the insurer’s decision to deny his claim for damage caused by the collapse of a section of his house ceiling after windy weather has lost his complaint.

The Australian Financial Complaints Authority (AFCA) says QBE is entitled to reject the claim, ruling the available information supports the proximate cause of damage was faulty workmanship, which is specifically excluded from cover under the policy.

“In my view, the proximate cause of the loss was the poor workmanship in the fixing of the ceiling,” the AFCA ombudsman says. “Without this poor workmanship, I am not satisfied that the loss and damage would have occurred.

“The policy excludes cover for damage caused by a defect in an item, structural defects, faulty or poor workmanship or design.

“The available material supports that poor installation of the ceiling plasterboard is the proximate cause of damage and while the wind event may have contributed to the damage, it was not the proximate cause.

“As this cause is specifically excluded from cover under the policy, the insurer is entitled to rely on its policy exclusion to deny the claim.”

QBE had informed the complainant in May last year of its decision to deny the claim, after the engineers it had engaged to inspect the damage concluded the primary cause of the ceiling collapse was poor installation of the plasterboard adhesive.

The engineers were called in after the insurer’s builder, who was appointed to complete the make safe, reported that the damage was the result of a combination of wear and tear and possible high winds. The builder further noted there were no cracked roof tiles and that they did not see any storm-created openings.

The engineers’ report states a mild wind gust was the probable cause that initiated the damage but ruled it out as a proximate cause.

The report says the residue adhesive to the underside of the timber trusses was found to be spaced too far apart and not installed along the full width of the trusses' underside. This meant the adhesive was either not applied correctly or the trusses were poorly prepared, resulting in the adhesive not sticking.

But the complainant disagreed with the assessment, insisting the collapse of the ceiling in the lounge, kitchen and study area on the first floor could have been a result of wind and rain.

On the day of the damage on April 8 last year, the Bureau of Meteorology reported maximum wind speed of 30km/h, which it does not consider is high. While there were winds of 80km/h on April 4 and 5, this is only 61% of the wind speed the house was designed to withstand.

The engineers made another inspection of the damage, after the complainant advised the first assessment they made on April 22 was inadequate. The supplementary report following the second inspection says the application and finishing of the plasterboard and timber trusses did not comply with Australian standards.

The engineers engaged by the complainant also broadly agree with the findings made by QBE’s engineers. In their report dated June 26 last year, they highlighted poor installation of plasterboard adhesive as the primary cause of the ceiling collapse.

They also say it is not uncommon for ceilings to collapse due to a combination of several reasons and existing defects and in this case water ingress may have been the contributing factor.

AFCA says the expert evidence from the complainant’s engineers does not assist his case, ruling the available information does not suggest that the plasterboard, insulation or trusses had been subject to any water ingress or water staining.

Click here for the ruling.