Broker in clear after hay left under cover in an uncovered shed
A farm package policyholder has lost a dispute with her broker after a storm claim was declined because a damaged shed was protecting hay, putting it outside the home and contents cover.
The insurer said the complainant had not insured farm buildings and contents, and the home and contents policy did not include hay sheds unless listed as farm property.
The claimant alleged her broker was aware of the farm business and her desire to have the shed covered but did not have it correctly insured.
She told the Australian Financial Complaints Authority hay was temporarily moved into the shed to stop it getting wet, with domestic items removed a few days before the loss event. She was unaware the change would affect coverage.
When taking out the policy in 2018, she was assured all sheds and outbuildings in the home block were covered, but shed contents would not be unless they were household or domestic goods, she said.
The AFCA decision notes the insurer and the policy later changed and the broker representative the complainant dealt with had retired.
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The claimant said she was given no indication that the shed’s contents would jeopardise the building’s insurance, and it should have been brought to her attention.
The shed was damaged by strong wind in December 2021.
A broker with Steadfast Taswide Insurance Brokers said he advised the complainant the shed was covered under a home and contents policy, and that he was not told it was used for farming purposes.
AFCA says the shed was not listed under farm property in the policy schedule or product disclosure statement, and it was the complainant’s obligation to ensure cover was sufficient for her purposes and not the broker’s obligation to take her through every provision.
“I accept that the shed was being used for domestic purposes when the policy was incepted. However, at the time of the loss event the shed was being used for farming purposes, to protect the hay from rain,” an ombudsman said.
“I also accept that the broker did not and could not have known this, as the shed’s use for farming purposes was not communicated to it until after the loss event.”
AFCA finds no action is required from the broker.
The decision is available here.