A homeowner whose flooring was damaged in a storm has won a claim dispute after her insurer refused to replace carpet throughout the property, meaning she faced a “patchwork” of different styles.

The home featured continuous carpet connecting rooms, hallways and stairs. The upstairs theatre and ground-floor library were damaged in the storm.

IAG-RACV joint venture Insurance Manufacturers of Australia accepted the woman’s damage claim but could not find an exact carpet match.

It proposed using similar carpet in the theatre and library but not replacing undamaged sections in the rest of the home.

The homeowner told the Australian Financial Complaints Authority this would create a patchwork effect, impacting the home’s aesthetic and its value.

AFCA says repairing the carpet “means restoring a uniform appearance”.

The insurer must replace the carpet throughout the property or pay the complainant the cost of doing so, it finds.

The policy had an anti-matching provision for buildings but not for contents – the classification carpets fell under.

The insurer argued repairing an item does not involve maintaining a uniform appearance, but AFCA says if that were the case, there would “be no need for the anti-matching provision under buildings insurance”.

“This implies the policy can cover the cost of replacing undamaged contents to maintain a uniform appearance,” the ombudsman said.  

“A carpet with a uniform appearance is substantially different to a carpet with a patchy or mismatched appearance. If the insurer replaces some of the carpet with carpet that is visibly different, the carpet will not be substantially the same as before it was damaged. It will be less attractive and less valuable. It will not be fully repaired.”

The function of carpet is “partly utilitarian and partly aesthetic”, AFCA says.

“A patch of carpet that is visibly different to the carpet around it is not performing the same function as one that blends in seamlessly.”

Because the insurer could not find carpet that would match, AFCA says the “only way to maintain a uniform appearance is to replace the carpet throughout the property”.

Insurance Manufacturers of Australia also offered the homeowner $3000 compensation after she complained of delays in claim handling and poor communication from the insurer and its builders. She accepted the sum and AFCA says it is fair.

See the ruling here.