An Australian tenant who claimed she and her family were rendered homeless due to their insurer’s failure to properly assess damage claims due to mould has been compensated following a determination by the Australian Financial Complaints Authority (AFCA).
In May of last year, the complainant lodged a claim for mould damage for her contents which she noted as a ‘total loss’. Between June of the previous year and May last year, she had lodged a total of six claims for damage due to leaky appliances and storms, which her insurer, IAG, did not dispute. She noted that the leaks had caused mould and related damage.
IAG agreed to settle for damage caused by the water leaks but said the complainant had not established a total loss. They said that the mould damage was due to the “ongoing negligence” by the owner of the building, for not repairing the areas that leaked.
The complainant appointed her own building biologist, who reported air and surface sampling returning “extremely high levels of mould” and recommended that the contaminated items not be moved within the home.
The building biologist also conducted a secondary inspection a week later, noting that the fungal spore concentration samples within the property were five to ten times higher than those outdoors, and noted that all porous and semi-porous items within the home be considered “non-restorable waste”.
AFCA agreed with the building biologist’s findings, noting that, based on the evidence, that there was a “significant level of mould contamination” in the property.
Despite IAG claiming that the mould damage was caused by the complainant, and her landlord’s failure to address leaks, AFCA disputed the claim, noting that it was not her responsibility to be aware of the impact of water ingress, as a tenant and not an owner.
It said that the damage to the contents was likely “a combination of the impact of storm and water and oil leaks causing the development of mould,” which was covered by the insured’s policy.
Noting the volume of claims, and following assessment of the losses based on the damage to contents, they awarded the complainant $76,690,
noting the significance of the adverse health circumstances of mould exposure.
“The available information indicates that most likely the extent of damage to the contents would exceed the sum insured and it is fair in these circumstances that the claim be settled as a total loss,” AFCA said.
“While… there are many people who may have been able to continue to reside in the complainant’s home, I accept based on the reports provided, that both the complainant and her son were significantly impacted by mould.”