Insurer liable for swimming pool damaged by roof repairs

A homeowner will be compensated after a dispute ruling determined that an insurer-appointed repairer damaged her swimming pool while conducting separate repairs on her roof.

The complainant lodged a claim in April 2020 after a hail storm damaged her home. After prolonged delays, the repairs were completed between May and June last year.

On June 14 last year, the claimant contacted the repairer, referred to as PB, saying her swimming pool and the surrounding area, including the shade sail, sustained damage due to its repairs.

The complainant said repair debris – leftover nuts, bolts and steel fragments – had fallen into and around the pool, causing discolouration and rust staining.

PB denied liability for the damage but offered to arrange an attempt to remove the stains with a chemical clean.

The homeowner declined PB’s offer and contacted Allianz on July 2 to arrange a specialist assessment and rectification work to restore the pool. The insurer denied liability and said PB’s proposal was reasonable within the circumstances.

The Australian Financial Complaints Authority (AFCA) ruled that PB’s repairs likely damaged the swimming pool.

It said there had been no evidence to show there was previous rust discolouration to the pool and noted the “reasonably close” proximity of the repairs to the pool.

AFCA also referred to “extensive metal staining” to the pool lining and rust, which pool specialists appointed by both parties had confirmed. The Allianz-appointed specialist observed that metal debris embedded into the pool’s fibreglass caused the rust.

The ruling said the General Insurance Code of Practice required Allianz to accept responsibility for any damage caused by the authorised repairer.

AFCA acknowledged that the pool’s staining could not be removed and said it required a complete resurfacing to be restored to its previous state.

Allianz said its ability to mitigate the loss had been prejudiced by the complainant’s refusal to allow PB to conduct the offered chemical cleaning to the pool after its inspection on June 25.

The homeowner said her dispute with the insurer was that she wanted a pool specialist appointed to inspect the damage rather than an unqualified representative from PB.

The insurer provided a report from its pool expert from September 1 that noted that the embedded metal was “almost impossible to remove”, given the prolonged time that the stains had been present.

“From what I have been told, these stains have been present for 4 months. If this had been actioned within a couple of weeks of it happening, the rust stains may have lifted or subsided to barely noticeable,” the expert said.

The expert said stain treatment could be attempted but that there was “no guarantee” it would work, and staining was likely to resurface because the embedded metal would not be removed.

AFCA said it was unconvinced that the complainant’s initial refusal impacted the insurer’s ability to mitigate the damage. It noted that the expert’s report did not confirm if the chemical cleaning would have resolved the issue entirely but instead caused the stains to become “barely noticeable”.

The decision also commented that it was not until July 27 that PB recommended the chemical cleaning of the pool, six weeks after the damage had been noticed. It said that even if PB completed the cleaning on July 27, it would have been “well beyond” the stated “couple of weeks” recommended by the expert.

The ruling determined that the chemical cleaning offered by the repairer was unlikely to mitigate any of the complainant’s losses and required Allianz to cover the complainant’s losses to resurface the pool, which amounted to $16,500.

AFCA added an extra 20% cost for time and transfer of risk contingencies onto the quoted amount, upping the covered sum to $19,800.

The determination did not mandate Allianz to cover replacement costs to the pool’s shade sail, saying there had been insufficient evidence to show it sustained damage by the repairs. It did require the insurer to pay the complainant to have the shade sail professionally cleaned.

Allianz was also required to pay the homeowner for previously agreed upon electricity expenses relating to the removal of solar panels for the roof repairs.

AFCA denied the complainant’s attempt to have the insurer reimburse costs related to the swimming pool’s maintenance, saying those expenses are for the complainant “regardless of whether a claim existed or not”.

The complainant was also awarded non-financial losses of $3500 for stresses caused by Allianz’s “unreasonable” handling of the claim and poor communication, which AFCA said caused an “unusual degree of inconvenience”.

Click here for the ruling.