A homeowner will be compensated for his wrecked greenhouse after winning a claims dispute against his insurer, which tried to argue that the structure was a commercial building.

The complainant lodged a claim under his Allianz home policy after a storm had damaged his greenhouse. Allianz agreed that the storm caused the damage but denied the man’s claim, saying the greenhouse was a commercial building.

The claimant rejected the insurer’s assertion, saying there had been no evidence to prove that he had been using the structure for business purposes.

The Australian Financial Complaints Authority (AFCA) sided with the complainant. AFCA said the man's policy covers items that fall within the definition of "building", which includes any residential buildings or outbuildings on the site.

The greenhouse would fall within this description, it said, but specifically excluded are "buildings or structures used for business or commercial purposes".

"The insurer says the greenhouse falls within this exclusion given it was constructed for commercial purposes," AFCA said.

"However, this is not enough to fall within this exclusion. The wording clearly says the building has to be ‘used for business or commercial purposes’ in order to fall within the exclusion.

"The insurer has provided no evidence to show the complainant used the greenhouses for business or commercial purposes. The complainant specifically refutes he did. The insurer has provided no information to challenge this.

"This is consistent with the claim notes where the complainant told the insurer he was not using the greenhouse for business or commercial purposes."

AFCA required Allianz to cover the claim and pay interest from January 21 last year if it chose to offer a cash settlement.

Click here for the full ruling.