Slow leak damage not covered under all risks policy

Insurance Buildings insurance

Sandy put in a complaint with us when her insurer rejected her claim for damage to her lounge ceiling from water damage.

What happened

Sandy noticed a stain had appeared on her lounge ceiling. She called a plumber to come and take a look. They found that the waste pipe from the shower room above the lounge had a small hole in it. Over time, leaking water had built up to soak through to the lounge ceiling and caused the stain to appear. 

Sandy had an 'all risks' policy which covered damage, unless it was caused by a policy exclusion. One of those exclusions was for damage caused gradually. The insurer declined the claim for this reason, but Sandy wasn't happy about this, so she came to us for help. 

What we said

After checking the evidence from both sides, we were happy that the damage was from an escape of water from a pipe. This is something that most standard household policies would cover. 

Sandy had taken photos of the ceiling on the day she made the claim. We thought they showed that the stain was relatively new. It hadn't spread far and there were no signs of mould or darker, significant staining to suggest it'd been there for a long time. 

The shower pipe was underneath the shower room floor, so we didn't think Sandy could have been aware of the leak until the stain appeared on the ceiling below. 

We agreed that the damage had been caused gradually. And that meant the insurer's decision to decline the claim was consistent with the policy wording. 

But we didn't think it was fair to decline Sandy's claim as it was damage that's usually covered by standard policies. She couldn't have known the damage was happening, and she'd reported the damage to the insurer fairly soon after she noticed it. So we decided to uphold Sandy's complaint.