Farm Flood Dispute Shows the Cost of Delayed Claims Handling

The dispute followed flooding in late February 2022, with the claim lodged in early March that year under a farm pack policy. The insurer accepted the claim, but the parties disagreed over the repair scope, the adequacy of cash settlement offers and the impact of delays. AFCA ultimately preferred the policyholders' quantity surveyor evidence, which identified repair items the authority considered had not been adequately allowed for, including mould remediation, asbestos-related work, wall and ceiling linings, engineering costs and council approvals.

For farmers, the key lesson is not that every flood claim will produce the same outcome. AFCA determinations are fact-specific, and policy terms, insured values, exclusions and evidence can vary significantly. However, the ruling does highlight why a farm insurance claim involving water damage needs to be managed as a building, health, documentation and business continuity issue at the same time.

Several practical points stand out for rural property owners reviewing their own readiness:

• Photograph and video damage early, including water lines, contaminated materials, sheds, contents, fencing, machinery and access points.
• Keep written records of insurer contact, assessor visits, repair authorisations, temporary accommodation costs and any directions from councils or emergency services.
• Seek written permission before major strip-out or repair work where possible, while still taking reasonable steps to limit further loss.
• Check whether the repair scope properly reflects rural realities, such as contractor travel, freight, engineering, approvals, hazardous materials and replacement lead times.
• Challenge unclear assumptions about maintenance, pre-existing damage or mould if the evidence does not support them.

The ruling also reinforces the value of understanding the difference between a cash settlement and insurer-managed repairs. A cash amount may appear straightforward, but it needs to be tested against the actual cost of reinstatement, contingencies, specialist reports and any loss of repair warranties or guarantees. Where large farm buildings, older homesteads or remote locations are involved, estimates prepared without adequate site inspection may not capture the full repair pathway.

More broadly, this decision is another signal that claims evidence matters. A well-organised file can help farmers explain what happened, what changed over time and why additional costs were incurred.