A QBE business pack customer who disputed the insurer’s decision to reject his claim for water damage, insisting the initial inundation at the insured premises was caused by storm water and not flood, has lost his complaint.

The Australian Financial Complaints Authority (AFCA) says the exchanged material shows it was flood waters from a creek and a central basin area that damaged the property in Lismore, NSW, in December last year.

AFCA also says it was clear that that the customer, whose claim was lodged by his broker days after the inundation, was aware he did not have flood cover under the policy.

In the policy issued to the customer, flood is defined as the covering of normally dry land by water that has escaped or been released from normal confines such as a creek, canal, dam or a lake.

As the policy specifically excludes damage caused by or arising from flood, QBE is entitled to decline the claim, AFCA says in its ruling of the dispute.

According to details provided in the ruling, the customer says his business premises was inundated by storm water, following a torrential downpour in Lismore on December 16 last year. More than 200mm of rain was recorded between 9am and 6pm on that day, causing widespread flooding within the city.

His broker contacted QBE a week later to lodge the claim for storm water damage to the flooring of the property on a street identified as D in the NSW city.

The complainant provided two statutory declarations to support his position regarding the storm water inundation. He also submits the water is clear, citing it as evidence that the inundation was from storm water.

However AFCA was not persuaded by his arguments, backing QBE’s position that the damage fell within its policy definition of what constitutes a flood.

A hydrologist engaged by QBE visited the property on January 12 this year, and their report released days after the site visit states the initial above-ground floor level inundation was the result of water overflowing from the creek - named as B in the ruling - and central basin area.

“[The hydrologist] noted as the local catchment draining to the buildings on the complainant’s property is not significant, stormwater runoff would not have caused inundation prior to the arrival of water from B Creek and the central basin,” AFCA said.

“[The hydrologist] concluded the maximum depth of above floor inundation of the complainant’s property was caused by water overflowing from B Creek and the central basin area.

“This information shows the findings of [the hydrologist] were conclusive in detailing inundation was due to flood waters.”

AFCA also dismissed the customer’s complaint that QBE did not handle the claim in a timely manner.

It says a review of the available information shows the insurer took about two months to decide on the claim, starting from the day the claim was lodged to the day the customer was informed of the outcome.

Click here for more from the ruling.