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Patrick H.
Patrick H., Lawyer
Category: Australia Law
Satisfied Customers: 5375
Experience:  Dip Law LPAB - Sydney based lawyer
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I have a situation here regarding property/home insurance.

Customer Question

Hi. My name is ***** ***** I have a situation here regarding property/home insurance.
It was last year Nov 2014 when my daughter accidentally damage the wall. She accidentally stepped on the gas instead of the break and as a result the wall has been damaged. My landlord, who happens to be my sister filed an insurance claim and it was approved. So in short, the wall has been fixed and the insurance company shouldered the expenses which amounted to $12,000.
After one year, Nov. 2015, my daughter got a letter from the insurance company saying that she is liable and responsible for the damaged wall and that they have the intentions of recovering the expenses. I dont really understand why its been a year since the incident happened and wondered why they approved my landlords/sisters claim in the first place to fix the damaged wall. Please help as we are just ordinary people who cannot afford to pay the $12,000 they are after. Thanks. Maria.
Submitted: 1 year ago.
Category: Australia Law
Expert:  Patrick H. replied 1 year ago.

Hello and thank you for your question.

Your landlord's insurance covers only your landlord against damage caused to his property. When a landlord insurer pays a claim of this sort, they then acquire the right to recover the damage against any party they can prove was responsible for the damage, and they have several years to make such a claim.

Now, if you have your own insurance, such as contents insurance which would govern you and your family members who reside in the property (or if your daughter has her own home or contents insurance and lives elsewhere, then you should refer this claim to hat insurer, as such policies will have a public liability extension that will cover you/your daughter to damage you or your daughter may cause to other people's property. In those circumstand you or your daughter's insurer would then settle the matter with the landlord's insurer.

If there is no such insurance, then unfortunately your daughter may be liable if she caused the damage through her negligence. If that is the case, and they can prove it they can sue her for the full amount of the damage, and ultimately bankrupt her if she is unable to pay.

If the situation is that she is unable to pay but liable, then her best option is to try to negotiate a reasonable outcome that she can afford to pay, either by installments or some reduced lump sum settlement. The insurer is still likely to require her to pay whatever amount they believe she can afford to pay, but your daughter may still be able to negotiate a greatly reduced amount to resolve the matter, as insurers are not usually interested in incurring the legal expenses of bankrupting someone who genuinely cannot pay, as this costs them money, and so will usually only do so if they believe the person will pay more if subject to such action.

I appreciate the above may not be what you wanted to hear but assist your understanding of your daughter's legal situation.

Good luck and PLEASE RATE MY ANSWER.

Patrick

Expert:  Patrick H. replied 1 year ago.

Please rate my answer as I am not paid unless you rate my answer positively.

Thanks,

Patrick