Suncorp must pay homeowners $155,359 plus compensation after it wrongly denied liability for damage caused by a burst flexi-hose.  

The insurer agreed to cover wardrobe cabinetry, plaster, skirting boards, paint and bedroom floors after the faulty pipe spewed 50-degree water throughout the home for several hours.

But it argued the event did not damage floor tiles and subflooring.  

Suncorp’s restorer, builder and engineer said moisture in the flooring was caused by the absence of surface drainage systems and protective coating, plus long-term moisture exposures.  

“The extent of damage/degradation to the particle board flooring observed is not consistent with moisture exposure from the one-off event,” the engineer wrote.  

But the claimants’ engineer said areas of particleboard had “significant water damage” that extended under tiled areas of the house.  

And a hygienist reported that water damage caused several of the particle boards to swell and lose structural integrity.  

This expert found moisture levels across the flooring and other internal areas remained beyond acceptable standards after the insurer’s assessments.

Both parties found mould in the home.

The claimants said the tiling suffered “collateral damage” from the waterlogged particle board, which was “no longer structurally sound as a base to support the house structure”.  

They had engaged a builder to begin repairs for a quoted cost of $129,466.  

In a dispute decision, the Australian Financial Complaints Authority agrees the loss is covered, noting the insurer accepted a claim for damage to the bedroom’s particle board, which connected to other areas of the home.  

It says moisture remained trapped under the tiles and particle board for months, causing further damage.  

AFCA says a cash settlement should match the builder’s quote, plus a 20% contingency.  

The insurer must also pay for costs related to temporary accommodation, storage and expert fees, plus $5000 for inconvenience and stress caused by its claims handling.  

See the ruling here. 

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