The owner of a rusty shed has won a payout in a claim dispute after it was blown over by strong winds and partially demolished during a severe storm last winter.

The Youi home insurance customer made a claim for storm damage to his home and other structures in June. The insurer accepted the claim for some damage and made a cash settlement but declined inclusion of the shed, saying the proximate cause of that damage was deterioration of the structure.

The Australian Financial Complaints Authority (AFCA) ruled Youi must arrange an actionable quote for repairs to the shed and pay the owner that amount, plus a 15% uplift for repair contingencies and transfer of risk.

“While the shed did have rust and corrosion, damage to the shed was the direct and immediate result of wind during the storm event,” AFCA said.

“A common-sense assessment makes it clear that parts of the shed were blown over by strong winds and that this was the immediate and proximate cause of the damage. Accordingly, the insurer is not entitled to decline the claim for damage to the complainant’s shed.”

The policy excluded loss or damage to property caused directly or indirectly by "wear and tear, rust, corrosion, or deterioration".

Youi’s builder assessor said the shed damage was the result of age and deterioration as its footings and fixtures were rusted and sheared off at ground level, while Youi’s engineer - who inspected the site about 10 days after the storm - said severe corrosion of the structure caused the shed to collapse during the strong winds.

The failure of the structure was observed where there was corrosion of steel post to pad footing connections, and the southern opening of the shed had no ridged connections or portal structure to resist lateral wind loads, making it susceptible to high wind pressures to all its clad surfaces, further contributing to the failure of the structure, Youi said.

Photographs backed up the assessments of severe levels of deterioration throughout the structure and the points of failure. Youi said structural deficiencies and deterioration allowed the shed to fail during wind speeds that were far less than what a structure of its type should be designed to withstand.

The shed owner said a weather station relied on by Youi indicating maximum wind gusts of 54km/h was located around 20km away and at a lower altitude than his ranges area property.

The shed had been stable for the five years he owned the property and withstood other storms, and the June storm affected thousands of properties and similar sheds on neighbours’ properties had been demolished. His photos showed large gum tree branches had fallen and other storm damage at the property, and he noted Youi had covered damage to his fencing caused by fallen gum trees.

AFCA said online media reporting made it is clear severe storms occurred in the region of the property on June 10, with reference to heavy rains and damaging winds, and that the wind speed data provided by Youi was “not persuasive” due to the distance between the weather station and the property.

“While I accept that the information shows that the complainant’s shed was corroded in certain areas, I am not persuaded that the proximate cause of the damage was deterioration,” the ombudsman said.

“There was no doubt that a severe storm occurred that caused damage to the complainant’s home and that the wind speed was high enough to blow parts of the shed away, and to cause large gum tree branches to fall on the property, and that the shed had been standing without damage from wind/storm for at least five years.”

See the full ruling here.