A homeowner will not be reimbursed for water damage to his investment property after a claim dispute hearing found an incorrect roof installation was the main factor behind the loss.

The complainant lodged a claim citing damage to the lounge room floor and walls following heavy rain on June 8 last year.

He said water entered through the roof and the room’s window side.

Insurer Allianz appointed a builder, referred to as AB, who found the property had been affected by the rain. The builder conducted make-safe work to address water ingress in the roof, which they said was an “ongoing issue”, as evidenced by mould damage.

AB also obtained the opinion of a roof expert, who reported the roof had been in “average” condition. The expert noted water ingress had occurred due to “flashing that was not correctly installed”.

The builder said water entry should stop once the flashing was replaced. 

The insurer accepted that rainwater had entered the home but said AB’s findings showed the damage occurred due to a “combination of incorrectly installed roof flashing, poor workmanship, wear, tear and gradual deterioration”. It said these causes were excluded from its policy. 

The homeowner did not submit a countering expert opinion and instead relied on rental agent tenancy inspection reports that “showed no apparent issues of concern with the roof”.

In its dispute decision, the Australian Financial Complaints Authority says these reports show only that the issues had not been identified, not that they did not exist.

It says AB was the only expert to observe the damage and notes the claimant did not point to any issues with water ingress following the builder’s temporary fix to the flashing.

“The exchanged material confirms there was an issue with the roof flashing, which permitted water to ingress into the home,” the authority said.

“There is no persuasive evidence this issue was caused by the storm.

“Rather, it was, on balance, due to the way it was installed. As the policy excludes such a loss from cover, the insurer is entitled to deny the claim.”

The authority say whether or not the complainant was aware of the installation issue is "not a relevant consideration" under the exclusions the insurer relies on.

Click here for the ruling.