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Ask Leon Your Own Question
Leon, Solicitor
Category: Australia Law
Satisfied Customers: 44391
Experience:  BEc Dip Ed, Dip Law (SAB) MTax (UNSW)
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Can an insurer who investigated a claim, ran it through its

Customer Question

Can an insurer who investigated a claim, ran it through its assessment process, then its internal dispute resolution processes and issued final determination on the claim, when the determination is challenged in court, come up with a 'new' determination, based on a different set of facts, and a different clause in the policy, that was neither investigated nor ran through the insurer's assessment processes of, i.e. the new determination made solely by the legal team defending the action.
Is this allowed under the insurance act or code of practice?
Submitted: 2 years ago.
Category: Australia Law
Expert:  Leon replied 2 years ago.
Good Morning
My name is ***** ***** I am a NSW Solicitor. Thank you for your question, and will do my best to assist you with your question.
Are you saying that he is now coming up with new facts?
In that case the initial determination has to be overturned.
When you say you applied for summary judgement, did they not defend your claim?
Customer: replied 2 years ago.
house damaged during Brisbane floods in 2011, ins said it was 'flood', but water never run over river banks - it was backflow inundation. Lodged SOC defence said flood, asked for summary judgement and a new defence saying it was water 'escaping' from the pipes was lodged.
Customer: replied 2 years ago.
accepted mistake it was not flood on amended defence, but it bothers me that they can reassess the claim outside the claim assessment process
Customer: replied 2 years ago.
Not sure if you got my message above. The insurer rejected the claim based on the flood exclusion clause, when I wrote the SOC I said they were wrong, it was backflow inundation. The defence continued defending the 'flood' assessment so I asked for summary judgement because there was no evidence to support flood. Three days before the hearing ins accepted mistake but lodged a new defence saying water 'escaped' from pipes, something never mentioned previously and not ran through claim assessment processes. The 'escape' argument is just as flawed as the previous 'flood' argument, but I think that is beside the point, my question is can a brand new insurance claim assessment be relied upon if not made through the formal assessment process?
Expert:  Leon replied 2 years ago.
Good Morning
They can do this.
What was the outcome did you get paid out as a result?
Customer: replied 2 years ago.
No, they still challenge the claim based on the new reasons. Wouldn't this crate a precedent as to why bother assessing any claims, reject them all and we assess if you challenge in court?
Customer: replied 2 years ago.
Ombudsman doesn't allow this I think, but we are in the district court
Customer: replied 2 years ago.
DC judge referred matter to commercial court
Expert:  Leon replied 2 years ago.
I am surprised you went to court and not the FOS.
The issue is the credibility of the assessor in this case changing his assessment.
Do you have your own assessment?
It goes to credibility.
But they can do what they want. It is a matter that you would report the insurer about using an inept assessor.
You have to run the case on this basis now and show that they are not sure what they are talking about.
You challenge them with your own report.
I hope this makes sense?
Customer: replied 2 years ago.
No, we all agree it was backflow inundation now, no dispute as to cause of damage. They just say water 'escaped' from the drains, and I argued that 'escape' doesn't apply because the drains are not designed to contain a river in flood.
The judge said "It may be ultimately that the plaintiff succeeds, and it might be said that the argument presented on behalf of the plaintiff by his father constitutes a strong case. Ultimately, however, I think that that is a matter for a trial judge. Among other issues, I am reluctant to determine that the plaintiff would inevitably ultimately succeed without the need for a trial because of uncertainties concerning the exact policy document and disputes as to whether or not the damage suffered by the plaintiff could be said to be caused by water leaking or escaping from a stormwater pipe off the site of the plaintiff’s property or from a stormwater channel or canal. Those it seems to me are factual matters about which evidence must necessarily be given, and which involve issues of construction of the wording of the policy."Leon, I need a case where water 'escaping' is discussed in the context of flood. Can you help with that? I am happy to pay for your time, of course.
By the way, I'm Albert
Customer: replied 2 years ago.
[9] That affidavit suggests it is reasonably likely that the damage to the property was caused by water from the Brisbane River forcing its way up the stormwater system – both up canals or channels and also up stormwater pipes – and then flowing onto the plaintiff’s property.
[10] Mr Merolla submitted the proper characterisation of this ingress of water onto the property was that it was not within the ambit of the term “flooding” as used in the policy and was also not water “leaking or escaping from pipes” onto the property, or from a “stormwater pipe off the site”.
[11] He submitted the exclusions in the policy were to cover the situation where water flowing down the stormwater drainage system as designed for, escaped from the system during its downward flow, and not to the situation where, as here occurred, water flowed up the system from a swollen river downstream of the subject property. He relied, in making this submission, on the decision of Jackson J in LMT Surgical P/L v Allianz Australia Insurance Ltd [2013] QSC 181.
Customer: replied 2 years ago.
SJ attached
Customer: replied 2 years ago.
Matter over 2 years old, not allowed to go to FOS
Expert:  Leon replied 2 years ago.
Good Afternoon
Have the orders been complied with?
Customer: replied 2 years ago.
The first one is due this coming Friday, not sure what we will get... The others will follow every two weeks, I.e. The SOC is due in three weeks
Expert:  Leon replied 2 years ago.
Good Afternoon
If they do not do what the orders says you take it back to court for a breach and seek that the judgement you requested be grated.
This is the best you can do.