A complainant who sought cover for storm damage to their swimming pool has won a claims dispute.

The policyholder lodged the claim in late November 2021, reporting that saturated soil slumped against the pool, causing its sides to “buckle”. They say water had leaked into the pool, which had been about a third full before the storm, from its sides, causing damage.

The claimant said the policy should cover the event as the damage was caused by earth movement that occurred within 72 hours of the downpour.

However, Auto & General declined the claim, saying the damage was caused by hydrostatic pressure, which was excluded. 

A report from the insurer’s engineer, who inspected the pool two weeks after the claim lodgement, agreed that the soil saturation was a factor in the damage but attributed the pool’s buckling to hydrostatic pressure. 

The engineer says the low level of water in the pool meant it was unable to resist pressure from water within the soil. 

The insurer also appointed a builder who noted that the pool lining had been “bellied and blistered due to lack of water and bulging of the sides”.

But a complainant-appointed engineer challenged the insurer’s findings, noting that the pool had a hydrostatic valve, which equalised the external pressure.

Auto & General said the hydrostatic valve had been removed from the pool when it had been emptied a week before the storm and said it was unclear whether it was put back.

But the opposing engineer referred to a photo of the empty pool taken on November 17, which showed the valve had been fitted into the pool. The insurer did not respond to this. 

The engineer said the likely cause of the incident was damage to the pool’s shell from the soil, which had slumped towards it during the storm. 

The Australian Financial Complaints Authority (AFCA) confirmed the engineer’s observations relating to the photograph of the installed hydrostatic valve and agreed that the likely cause of the damage was the saturated soil.

“The available information indicates the damage occurred because the soil became saturated by rainwater, causing it to slump against the side of the pool,” AFCA said.

“The policy covers damage that occurs this way: it covers damage caused by rainwater, including damage caused by earth movement that occurs within 72 hours, and because of, heavy rain.

“The available information does not show, on the balance of probabilities, the damage was caused by hydrostatic pressure.

“Therefore, the insurer is not entitled to apply the hydrostatic pressure exclusion to deny the claim.”

The ruling requires Auto & General to accept the claim but it can decide whether to complete the pool’s repair or cash settle. It says if the insured disagrees with how the claim is settled, they can lodge a separate complaint.

Click here for the ruling.