The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
A homeowner’s request for compensation after discovering a large pit on his property was denied when it was revealed to be a decommissioned well, rather than a sinkhole.
The deep pit, which measured 4.5 meters, appeared beneath pavers just 1.5 meters away from the house in August 2022.
The homeowner contacted QBE insurance to lodge a claim, prompting the insurer to send a team to cordon off the affected area for safety.
The homeowner argued that the pit had been formed by a leaking pipe and believed the visible water flow at the bottom was evidence of such. He suggested that the water leak had caused soil erosion, exacerbating the formation of the pit.
In response, QBE appointed a forensic structural engineer to investigate. The engineer, assisted by a plumber, conducted several tests and authored three reports on their findings.
The investigation concluded that the pit resulted from the collapse of a well capping that had been in place for over five decades, predating the home's construction according to the neighborhood residents' accounts.
According to the engineer, the old well capping had eroded over time, explaining the presence of water at the base. Nearby sewer and stormwater pipes were examined, and it was found that water flow into the pit had been consistent. A sewer pipe leakage, identified approximately 19 meters from the pit, was determined to be too far away to contribute to its formation.
No legal or physical connection was determined to link the sewer leakage or any nearby pipes to the well's deterioration. The plumber validated the engineer's conclusions, confirming a lack of nearby pipe networks capable of forming a sinkhole.
The Australian Financial Complaints Authority (AFCA) later ruled in favor of QBE, citing comprehensive evidence provided by the engineer. The findings firmly established that the pit was a disused well, lacking any evident links to a leaking sewer or other leaks.
AFCA endorsed, "The expert evidence substantiates that the pit originates from a long-decommissioned well existing before the complainant’s house was built. Despite extensive testing, the results indicate no connection between any pipe leaks and the pit’s formation, the water at its base, or the erosion observed."
Though QBE did agree to compensate for incidental damages done during the examination process, including $1122 for the damage to the homeowner’s timber deck and an additional $1500 for the delays in processing the claim, which took over six months.
This case, initially reported by insurancenews.com.au, underscores the critical role of thorough expert investigation to differentiate between naturally occurring subsidence and structural failures caused by other factors.
Please Note: We do not endorse any specific products or companies. Some content is sourced from third parties, including press releases, and may not be independently verified for accuracy or completeness.
NSW Fair Trading’s criminal proceedings against Network Strata Services Pty Ltd, trading as Netstrata, have pushed strata governance and insurance transparency back into the national spotlight. The regulator alleges the company and its director and licensee in charge breached statutory obligations connected with strata scheme management in New South Wales, including alleged failures around conflicts of interest, undisclosed financial benefits and information provided to the regulator. - read more
A fresh dispute over the proposed Insurance Brokers Code of Practice has sharpened the focus on transparency for Australian small businesses. Industry figure John Trowbridge has criticised gaps in the draft code, particularly around whether brokers should disclose commissions and other remuneration to all clients, not only those captured by narrower product or client categories. - read more
A recent Australian Financial Complaints Authority decision has put a spotlight on a detail that can be easy to overlook: how an income protection policy defines income. In the case, a policyholder receiving payments under an employer-arranged group income protection policy argued that regular sales commissions should be counted when calculating his pre-disability income. - read more
A fresh dispute over Australia’s insurance broking standards has put transparency back in the spotlight for small business policyholders, including personal trainers, fitness instructors and studio operators. On 17 July 2026, several consumer and strata owner groups withdrew from consultation on the National Insurance Brokers Association’s rewritten Insurance Brokers Code of Practice, arguing that industry self-regulation does not go far enough on conflicted payments and commission disclosure. - read more
Australia’s life insurance sector has welcomed the Federal Government’s updated expectations for APRA and ASIC, a policy signal that could shape how insurers balance consumer protection, affordability and innovation. The new expectations ask the regulators to keep the financial system safe and stable while also supporting competition, productivity and proportionate oversight. For life insurance customers, the practical question is whether that balance leads to clearer products, better service and cover that remains within reach. - read more
Public liability insurance is a type of coverage designed to protect businesses and individuals from the financial fallout associated with claims for injury or damage caused to third parties. It is particularly crucial for event organizers, who are responsible for ensuring the safety and security of attendees, vendors, and participants. - read more
Public liability insurance is a crucial form of protection for both businesses and individuals, safeguarding them against potential claims for personal injury or property damage that occur as a result of their operations or services. In an increasingly litigious society, having this coverage can mean the difference between staying afloat financially and facing business closure due to unexpected claims. - read more
Running a small business in Australia comes with its own set of challenges and risks. One crucial aspect that should never be overlooked is insurance, particularly public liability insurance. The reason is simple: it offers essential protection against claims of property damage or personal injury caused by your business operations. - read more
Liability insurance is a form of coverage that protects businesses against claims resulting from injuries and damage to people or property. It provides crucial peace of mind, ensuring that your business is shielded from potentially devastating financial losses due to lawsuits or claims against it. - read more
Liability insurance is a crucial form of protection that offers coverage against claims resulting from injuries and damage to people or property. Within the bustling landscape of Australian businesses, possessing this form of insurance is key to financial security and continuity. It acts as a safety net, ensuring businesses can manage risks without bearing the full brunt of potentially costly legal claims. - read more
Start Here !
Knowledgebase
Whole Life Insurance: A type of life insurance that provides coverage for the insured's entire lifetime, with a savings component that builds cash value.
No comments yet. Be the first to share your thoughts.