A homeowner has lost a dispute after his premium soared when he added partitions to his property and increased the number of rooms.

Suncorp lifted the man’s annual home and contents premium from $2482 to $5045, but he took his case to the Australian Financial Complaints Authority.

The insurer said it had changed the way it assessed risk and calculated premiums, and this accounted for an increase to $3449. The rest of the rise was imposed after the complainant told Suncorp he had installed partitions that brought the number of bedrooms from two to five.

The man said the insurer had not advertised the fact the number of bedrooms would affect the premium. He added that the overall size of the property had not changed, the extra rooms were not being used as bedrooms, and the partitions cost only $2000 to install.

In its dispute ruling, the Australian Financial Complaints Authority notes consumers are free to seek cover elsewhere if they believe an insurer’s renewal premium is too high. Its jurisdiction in relation to complaints about premium rises is limited, and in the absence of an error or inadequate explanation of a rise, it cannot compel an insurer to reduce a price.

It says that in this case, Suncorp provided a “reasonable explanation” for the increase, based on the cost to rebuild the now five-bedroom home, commercial factors and the risks associated with the property.

It adds the insurer calculated the premium correctly based on its usual practices, and did not misrepresent or fail to disclose the premium.

“The complainant has not identified any breach of a legal obligation or duty by the insurer,” an AFCA ombudsman said.

“I acknowledge the complainant says his cover is now limited and he does not hold contents insurance, which has caused him stress. However, I am not persuaded this was caused by an error of the insurer.”

See the full ruling here.