A commercial property owner who demanded her broker pay for storm damage repairs after her claim was rejected has lost a dispute before the industry ombudsman.

The owner lodged a claim in January last year following a hailstorm, but her insurer declined it that August because it had not been disclosed that short-term apartment lodging was offered on the premises.

The insurer said the owner had breached her duty of disclosure and it would not have offered cover if it had known the multi-tenanted property was also used for temporary accommodation.

The owner blamed broker Professional Services Corporation for the non-disclosure, and accused it of failing to arrange appropriate cover.

She said if PSC was a responsible broker, it would have asked her what type of property it was and what it was used for. She said she would have “openly and honestly” answered the broker.

But PSC told the Australian Financial Complaints Authority it arranged the business insurance cover based on previous policy terms that the owner’s prior broker set up with the same insurer.

The owner provided PSC with the previous broker’s 2024-25 renewal schedule, which contained a notice about the duty of disclosure and possible consequences of non-compliance. That schedule listed the owner’s occupation and the tenants’ businesses in the same way as the 2023-24 policy.

PSC said it relied on the information provided by the owner, and an email was sent in July 2024 providing her with quotes obtained on a like-for-like basis.

Later that month, the broker confirmed the cover would take effect on July 31. An email with the 2024-25 policy schedule, a disclosure duty notice and a “what you told us” form was sent to the owner. PSC asked the owner to review the documents to ensure the information was correct, and reminded her about the duty of disclosure.

The owner said she did not sign and return the “what you told us” form because she noticed the apartments were not listed. She said she called the broker to make the “necessary corrections”, but later said she may not have spoken with her contact and may have forgotten to call him again.

The complaints authority says there was no mention of short-term accommodation, or anything similar, in the old policy schedule to have alerted PSC.

“Based on the exchanged information, I am not satisfied that the complainant told the broker part of the property was used for short-term accommodation,” an AFCA member said.

“Further, she did not tell the broker that the information set out in her policy documents was incorrect, despite being asked to check that.

“Therefore, while I acknowledge the difficult circumstances the complainant has found herself in, I am not satisfied that the broker breached the duty of care it owed her.”

See the ruling here.