The complainant had argued that the storm-damaged items on the patio were enclosed enough to avoid the "open air" restriction, but the AFCA found the blinds in place did not ensure an enclosed space, lacking proper lockability. However, the authority noted the policy's language was not explicit in imposing the 10% limitation due to its placement under "additional benefits," which suggested the opposite of a restriction.
Moreover, the AFCA criticized the insurer for failing to present evidence that the policyholder neglected reasonable care of the items. In acknowledging the complainant's hardships, AFCA highlighted that the year-long exposure to mould had affected living conditions, despite the insurer disputing health impacts.
As part of the resolution, AFCA instructed a $4000 payment for non-financial losses, emphasizing that proof of health issues was unnecessary to confirm that the claimant's peace of mind had been compromised. The requirement for the insurer now includes engaging an expert for a comprehensive assessment of the storm and mould damage.
While the insurer can deduct the $1558 already issued as an ex-gratia payment and any policy excess, the decision underscores the necessity of precise and consumer-friendly contract wording to avoid customer disputes.
This case serves as a critical reminder for insurance companies to adopt straightforward language and place important limitations in unambiguous policy sections. As companies reassess contract terms, consumers might see increased clarity in coverage options, potentially averting future misunderstandings.
