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.
Please Note: We do not endorse any specific products or companies. Some content is sourced from third parties, including press releases, and may not be independently verified for accuracy or completeness.
In a significant development for Australia's transport insurance sector, specialist underwriting agencies Insuret and ATL have announced their merger, creating a unified national platform dedicated to fleet and trucking insurance. This strategic alliance is poised to address the evolving and complex risk demands within the country's transport and mobility sectors. - read more
The Australian Competition and Consumer Commission (ACCC) has escalated its scrutiny of Insurance Australia Group's (IAG) proposed acquisition of Western Australia's RAC Insurance, initiating a second-phase review due to potential competition concerns. This development underscores the regulator's commitment to maintaining a competitive insurance market, particularly in regions where market concentration could adversely affect consumers. - read more
Recent analyses by Aon indicate a notable decline in Australian insurance prices during the first quarter of 2026, with reductions ranging from 11% to 20% across various sectors. This trend is attributed to abundant market capacity and broader coverage options. However, escalating global conflicts, particularly in the Middle East, are casting shadows over the market's future stability. - read more
HESTA, a prominent Australian superannuation fund, has unveiled a significant reduction in insurance fees, set to take effect from 1 July 2026. This initiative aims to make insurance coverage more accessible and affordable for its members, aligning with the fund's commitment to enhancing member benefits. - read more
Hostplus, a leading Australian superannuation fund, has announced the extension of its group insurance partnership with MetLife Australia until June 2028. This strategic move aims to elevate the servicing models across claims and underwriting, ultimately delivering stronger outcomes for Hostplus members. - read more
The horizon of the insurance industry has undergone a transformative shift with the advent of digital technology. With a few clicks, consumers can navigate the once-complex world of insurance policies from the comfort of their home. The digital landscape for insurance services offers unprecedented access to information, comparisons, and instant communication, fostering a more empowered insurance client. - read more
For many millennials, navigating the complexities of personal finance and future planning can feel like a bewildering journey. Among these financial responsibilities, life insurance emerges as a paramount consideration. More than just a safety net, life insurance can be the cornerstone of a sound financial strategy, providing peace of mind for both the policyholder and their loved ones. - read more
Life insurance is a cornerstone of financial planning, offering peace of mind to you and security for your loved ones. It's a contract between you and an insurance company: in exchange for regular premiums, the insurer agrees to pay a sum of money to designated beneficiaries upon your passing. This vital tool ensures that your family's financial needs can be met during an incredibly difficult time. - read more
Choosing the right life insurance policy is one of the most important decisions for Australians, especially for those who are middle-aged or older. Life insurance provides financial security for your loved ones in the event of your passing, ensuring that they are not burdened with financial hardships. - read more
Life insurance is a crucial consideration for middle-aged to older Australians. It provides financial security for your loved ones in the unfortunate event of your death. Understanding the various options available is vital to making an informed decision. - read more
Start Here !
Apply now for your free Insurance assessment and price comparisons!
Knowledgebase
Endorsement: An amendment or addition to an existing insurance policy that changes the terms or scope of the original policy.
