Dispute Over Damages Caused by Violent Painters: Homeowners Unable to Increase Insurer's Offer
Homeowners Lose Battle for Higher Compensation After Painter Attack Damages
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
Homeowners claimed damages from contracted painters who damaged their property during a violent attack.
However, they have lost their challenge to increase their insurer's cash settlement offer of $53,000.
After purchasing the house, renovations were ongoing when a group of painters caused damage to several walls and windows in November 2021. The homeowners lodged a claim with IAG, and the male claimant alleged that the workers had "turned on him" during a meeting over workmanship issues and attacked him before causing damage to the property. The painters were later arrested for assault.
Assessment and Offer from IAG
An assessment from an insurer-appointed builder recommended that the matter be handled with a cash settlement, as repairs might not match the existing texture. The scope of works (SOW) for the repairs quoted by the builder was $13,203 in early December. Despite this, the complainants were not satisfied with IAG's offer, and the insurer's requested the builder to revisit the initial quote. AI updated the initial quote, and IAG offered a cash settlement based on the revised quote in April last year, which the homeowners dismissed again.
They had instead obtained a report from a quantity surveyor, referred to as JB, which stated that AI's SOW was insufficient to cover the rectification works and "not a genuine quotation". JB observed that the property had sustained water and ceiling damage, which led to mold growth. The surveyor quoted a repair cost of $120,000 to $130,000.
However, IAG denied responsibility for the mold or water damage and advised that the complainants would have to file a separate claim for the damage to be assessed. In August, IAG offered to increase its cash settlement by 25%, taking its offer to $24,765, which the claimants also rejected.
Builder's Report and Insurance Settlement Offer
The insurer then engaged a building consultant, referred to as CF, to inspect the property and report on the damage. However, the complainants denied them access. But CF provided a desktop report based on an analysis of the various quotes. The consultant estimated that the repair cost amounted to $39,504, which IAG uplifted with a 20% contingency and fees to cover four weeks of temporary accommodation. This led to the insurer’s offer amounting to $53,000.
The homeowners disagreed that the offered settlement was inadequate since it did not consider rectification works for mold damage, which had worsened due to the insurer's delays. However, the Australian Financial Complaints Authority (AFCA) determined that there had been no evidence to show "a causative link" between the malicious damage and water ingress, leading to mold growth.
"Given that the malicious damage involved scratching and gouging to internal walls and a window frame, the panel on balance considers it unlikely any such link exists," AFCA stated.
The panel further revealed that the delays that led to the mold growth could be attributed to the complainants' failure to provide an itemized counter-quote until mid-June last year, more than seven months after the claim had been lodged. If the homeowners wished to have the mold damage covered, they would have to file a separate claim.
AFCA Ruling
The AFCA acknowledged that IAG's offer was "overall reasonable" and required the insurer to waive the $1000 policy excess. The ruling also stated that IAG's offer for temporary accommodation was fair, despite assessments that suggested it would not be required. The homeowners' request for ten months' worth of accommodation, estimated to cost $23,336, was turned down by AFCA.
In summary, the insurer denied a request by complainants for a higher payout over damages caused by violent painters who were also charged with assault in November 2021. This decision was supported by AFCA, which found IAG's offer reasonable and fair, and the homeowners would need to file a separate claim for mold damage.
Published:Wednesday, 31st May 2023 Source: Paige Estritori
Please Note: If this information affects you, seek advice from a licensed professional.
As of 1 July 2025, the Department of Health, Disability and Ageing has introduced a professional indemnity insurance (PII) product specifically designed for midwives providing intrapartum care. This development, under the Midwife Professional Indemnity Scheme (MPIS), ensures that private midwifery practitioners now have access to insurance coverage encompassing all facets of their practice, including intrapartum services. - read more
In recent developments within the Australian healthcare sector, a significant number of bariatric surgeons are contemplating the future of their medical practices due to a substantial increase in indemnity insurance premiums and a rising incidence of legal claims. This trend poses potential challenges to the accessibility of obesity-related procedures for patients across the country. - read more
Recent projections indicate that global health insurance costs are set to rise by 10.3% in 2026, marking a continuation of the upward trend observed in recent years. This follows a 10% increase in 2025 and a 9.5% rise in 2024, underscoring the sustained inflationary pressures faced by insurers and employer-sponsored health plans worldwide. - read more
Marsh, a leading insurance broker, offers tailored insurance solutions designed specifically for fitness professionals across Australia. Recognising the unique risks associated with the fitness industry, Marsh provides comprehensive coverage options to safeguard personal trainers, gym owners, and other fitness practitioners. - read more
AUSactive, Australia's peak body for the exercise and active health sector, has introduced the Professional Plus Membership, a comprehensive package designed to support fitness professionals in their careers. This membership combines the benefits of AUSactive's professional membership with an exclusive insurance policy tailored for those delivering fitness, exercise, and active health activities. - read more
The digital age has fundamentally transformed how we approach almost every aspect of our lives, including the way we shop for life insurance in Australia. Gone are the days when one had to schedule meetings with insurance agents or flip through pamphlets to understand life insurance policies. Today, obtaining life insurance quotes online has become the norm, offering a hassle-free and incredibly accessible platform for individuals to safeguard their financial future. - read more
The financial fabric of our lives consists of both planning and safeguarding against the unforeseen. Trauma cover, a lesser-known but crucial aspect of personal insurance, provides this protection by offering a lump sum payment upon diagnosis of specific serious illnesses or injuries. In the tapestry of financial planning, it acts as a vital safety net, ensuring that unexpected health crises do not lead to monetary distress. - read more
Welcome to a pivotal guide dedicated to empowering you with the essentials of income protection insurance in Australia. As we navigate through times of uncertainty, safeguarding your financial wellbeing becomes not just a priority, but a necessity. Income protection insurance stands as one of the key pillars of financial security, ensuring a steady flow of income during periods when you're unable to work due to illness or injury. - read more
When you’re young, life is all about new experiences and making plans for a promising future. While factors like travel, career, and relationships often take centre stage, one aspect often overlooked is life insurance. It might seem like something to consider later in life, but starting a policy while you're young can be a savvy financial move. - read more
Life insurance and estate planning are critical components of financial security. They ensure that your loved ones are protected financially when you are no longer around. By understanding these tools, you can take significant steps to secure your family's future. - read more
Start Here !
Apply now for your free Insurance assessment and price comparisons!
Knowledgebase
Umbrella Policy: An additional insurance policy that provides extra liability coverage beyond the limits of the insured's primary policies.
