Insurer Denied Your Legitimate Claim? Take Them to AFCA (It’s Free)

A storm took half your roof off. You’ve paid $2,100 a year in premiums for eight years. The assessor came, took photos, and three weeks later the letter arrived: “claim declined due to pre-existing wear and tear and lack of maintenance”. The $14,000 repair is now apparently your problem.

Or: your car was stolen. The insurer found out you’d had a speeding fine you didn’t mention when you took out the policy. Claim declined for “non-disclosure”. The fine has nothing to do with theft.

Both of these are fights you can win. Here’s how.

Step 1: Internal dispute resolution (IDR)

Every insurer must have an internal complaints process and must respond within 30 days. Write (don’t ring) to their complaints team. Say clearly: “I dispute the decision to decline claim number X. I request a full copy of the assessor’s report, all documents relied on, and a written IDR decision.” They have to give you the report. Read it. It often says something different from the decline letter.

Step 2: Know the rules they broke

• Insurance Contracts Act s 13 – the insurer must act with the utmost good faith. Stretching “wear and tear” to cover storm damage isn’t good faith.
• Insurance Contracts Act s 54 – the insurer can’t refuse a claim because of something you did or didn’t do unless it actually caused or contributed to the loss. A speeding fine didn’t steal your car.
• General Insurance Code of Practice – sets timeframes and requires them to explain decisions and give you the evidence.
• Australian Consumer Law s 18 – misleading conduct applies to how policies are sold and described.

Step 3: AFCA

If IDR fails or 30 days pass, lodge with the Australian Financial Complaints Authority. It’s free for you. It costs the insurer a fee for every stage the complaint goes through, which is a strong reason for them to settle early. AFCA’s monetary limits are set in its Rules, and its decisions bind the insurer, not you.

Your AFCA complaint should:

• Set out what happened and when, in date order.
• Attach the policy, the decline letter, the assessor’s report, your photos and your own builder’s report if you have one.
• Explain why the decline is wrong, citing s 13 and s 54 where they apply.
• State exactly what you want: the claim paid, plus any extra loss caused by the delay.

Get your own report

For property claims, a $300 to $600 report from an independent builder or roofer saying “damage consistent with storm event on [date], not long-term deterioration” is the single most effective thing you can do. Insurers’ assessors work for the insurer. Yours works for you.

Why this works

A well-put-together AFCA complaint with an independent report is in the minority that gets paid. Many insurers settle at the AFCA “registration” stage, before a case manager even looks at it.

Eight years of premiums bought you the right to be paid. Make them honour it.

Claim Done drafts your AFCA Complaint for $97. Done in about 5 minutes. You approve it before it is sent.