Rejected Insurance Claim :-(

Hoping for some guidance on whether there are appropriate grounds for appeal for a rejected insurance claim

The scenario:

• Settled on a property in Oct 2015, tenant was already in place, however they were in arrears (3weeks) and complete documentation didn't exist and property management was done by owner
• Fast forward to Jul 2016, and the tenant started falling behind in arrears and 2 x court tribunals later we were finally able to evict the tenant (at first hearing judge gave leniancy due to recent birth of child)
• Tenant was in arrears a total of approximately 4 months including some minor malicious damage to the property
• Insurance claim was raised however was reject on the basis that the tenant was in arrears when we took over the property
• Property is in Kallangur, QLD and I have a property manager that looks after the property

Any of you guys know if in this situation there is any grounds for a appeal.. hoping for some advice.......

 

This site may help ..
Home | Residential Tenancies Authority

 

What do the policy terms say. You cant appeal a disregard of the policy wording.
Your due diligence when acquiring overlooked that concern

 

Your broker will be a good contact point here - this is where they really make a difference.

 

EBM policy wording

What we will NOT pay.... We do not pay under Section 4: (Rent Arrears) when rent is in arrears on or before the commencement of the period of insurance. Cover will not apply until rent in arrears is brought up to date.

 

So then if rent was brought up to date at any time after purchase, cover does apply?

@qonyx_sydney was the rent ever up to date?

 

I also note two other concerns in the OP
1. No lease documentation. Mopst insurances refer to a lease. Not a undocumented agreement to pay rent (this is why AibBnb can be excluded - Its a short stay let)
2. No PM. Most LL insurers have a expectation of a PM or a onsite managing agent.

All reasons why EBM would not pay. Assuming is a equivalent policy of course. So important to understand what is insured and make no assumptions. Insurance companies will happily accept your premiums and deny claims.

 

Although, the OP did state:

Property is in Kallangur, QLD and I have a property manager that looks after the property
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Hopefully the PM got the rent up the date at some point and EBM has just made a mistake. I have found insurance companies often refuse claims then back down if challenged.

 

exactly, its all in the insurance policy/contract, not a leg to stand on

 

Lets not assume its EBM...I just used their policy as a guide.

I recently had hail damage to my car and was in getting assessed early this week. Guy before me had arranged a install of replacement windscreen. They told him they would not pay that claim as the policy specifically say he needs to get approval for all emergency costs over $200. He didnt so they wont pay. He was unimpressed but that is the policy wording. He argued that if they approve it now he can be reimbursed...No they say they would have sent him to a cheaper repairer. Thats why the rule exists. He asked for the lesser amount. No. He didnt follow policy. Paying him rather than their glass replacement specialists costs admin time etc . So...no approval !!

Guy behind me had a lambo. Three panels of glass including windscreen broken. His claim for glass alone likely to be $8500 (only glass supplier is genuine part !!) and they just approved it then and there and said they would do arrange the glass and install by Obriens while it was being repaired for hail. Two approaches to the same issue.

 

Not true at all. My mate got refused, appealed then approved. He breached the terms of the policy but had mitigating circumstances and got the refusal overturned on appeal. Insurance is a lot of discretion. Mostly the discretion to refuse claims that fall within policy. In my experience you have to push to get a claim paid.

 

so what were circumstances ?? curious

 

Thanks everyone for your feedback and there are definitely some things i should have double checked before settling and I'm a little disappointed that my PM didn't sort this out as soon as I settled which has subsequently resulting in this rejected claim.

I'm not sure whether the tenant ever got to be current with their rent, however I will check with them and also look at at my policy wording (Terri Sheer).

At the end of the day the loss isn't significant (~$4k) so can just attribute this to the mistakes and subsequent learning that we will all go down.

For my next purchase i did a lot more due diligence on the current tenant which I would have normally expected the PM to conduct.

 

Insurance company claimed that something that was storm damage was a maintenance issue. Not true. I helped my mate prepare a comprehensive submission to the insurance company with a lot of evidence about the storm and the damage it did. Even then it still took a few more emails. Insurance companies don't care if they are in the wrong. It's a war of attrition. The person who refuses to back down wins.

 

I would advise you to check with the PM if the tenant ever got up to date and then appeal. It can sometimes take a few goes to get them to pay. It may not work but it is worth a shot for $4k.

 

Insurance ombudsman another option

 

The insurance ombudsman is a last resort. If you go straight to them they will direct you to the appeals process with the insurer first. Once that avenue is exhausted the ombudsman may decide to become involved if the circumstances warrant.

Gather your evidence and appeal if appropriate.
Marg

 

Yes went down this road long story, took 12 months I eventually won the rejection was overturned and insurance company had to cough up 30k for roof

 

We had a decision on a landlord claim overturned on appeal. Total stuff up by Terri Scheer rep and PM, who betwen Sometimes you just have to deal with things yourself.
Marg