A farm owner whose cottage was severely damaged by a “likely intentionally lit” fire will not be covered for his losses. 

The complainant lodged a claim on January 16 2020, after a late-night blaze destroyed the insured building and the contents inside. 

Chubb accepted that the building had been damaged but denied liability, saying that the claimant misrepresented information when renewing the farm insurance policy and that the claim was fraudulent. 

The insurer alleged that the man failed to disclose information about previous fires on the property, the poor condition of the insured building, and past claims filed within the past three years when adding the cottage to the policy a day before the claim was lodged. 

It said that the complainant had lodged a claim for damage to contents from a fire in August 2019 and a separate claim in November 2019. Records showed that the complainant had not made a claim within the past three years but that his former partner, referred to as AB, had filed one on a separate policy for damaged contents.  

The Australian Financial Complaints Authority (AFCA) noted that the cottage had not been insured under the policy at the time of the August 2019 fire and disagreed with the insurer’s contention that the man had failed to declare his claims history when he added the cottage to his policy. 

“There is no history that the complainant had any claims in the three years prior to January 15 2020,” AFCA said. 

“As indicated previously, the only claim was lodged by the complainant’s ex-partner AB on policies held in her name.”  

It acknowledged reports showing that fires had occurred on the property but said there was no evidence to show that the cottage had been in “disrepair or poor condition” before it had been added to the policy. 

However, the ruling questioned the circumstances of the January 2020 claim, saying that the available information indicated that the claim was fraudulent and that the fire was intentionally lit by the complainant or someone with his implied consent.  

AFCA highlighted that AB had taken out cover for the damaged contents a week before the fire and that the cottage itself had been added to the policy on the same day as the event. 

It said that “the coincidence of the timing of the insurance and the fire cannot in these circumstances be ignored”. 

The claimant alleged that a person he had previously been disputing with, referred to as SM, had been responsible for the fire, despite SM moving to another state months before the fire.  

AFCA noted that AB, who had been staying at the cottage, had left the building just hours before the fire and left its entrance unlocked despite her concerns about SM. AFCA also identified that CCTV footage from the claimant’s shed had been turned off hours before the fire without explanation.  

It said that given the property’s remote location, the complainant or someone with his knowledge would have been able to set fire to the property. 

“While the complainant says SM lit the fire, there is no evidence to implicate this person in the fire,” AFCA said.  

“The only people identified as being near the cottage in the hours leading to the fire were the complainant and AB.” 

The ruling acknowledged forensic evidence as well as the complainant’s available opportunity, potential financial motives and character as indicators that the fire was intentionally lit by someone who had access to the cottage on the evening of January 15, 2020. 

It said that Chubb was entitled to refuse payment relating to the claim as per Section 56 of the Insurance Contacts Act 1984 (cth) “on the grounds the claim is fraudulent”. 

“In my view, the evidence is sufficient to establish that most likely the fire was deliberately lit by the complainant or someone with the complainant’s knowledge and express or implied consent.

“I am satisfied the complainant has provided false and misleading information as to the circumstances of the claim to deceive the insurer into making payment of the claim.” 

Click here for the ruling.