Complaint

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					GROUP: Fire and General Insurance
SERVICE: House
Complaint No : 109196
YEAR: 2001

Casebook Index: Gradual damage, Interpretation - Specific policy provisions,
Land movement/Settlement/Subsidence.


Complaint
The roof of C’s septic tank collapsed. C made a claim to P for the loss under his house
insurance. P appointed a loss adjuster and an engineer to report on the cause of the
loss. The loss adjuster and engineer concluded that the loss was caused by the septic
tank being buried too deeply and the excess soil, exacerbated by heavy rain, weakened
the roof of the tank. P declined the claim on the basis the loss was gradual damage
which was not covered under the policy. C argued that if the loss was caused by
gradual damage, then it should still be covered by the policy, as it was sudden and
unforeseen.
Assessment
As septic tanks are buried and hidden from inspection, it is difficult to ascertain when
the damage first occurred. For that reason, the probable cause of damage can assist in
determining when the damage took place.
The septic tank was cleaned 6 months prior to the roof collapsing. The septic tank
cleaner stated there was at least 6 feet of soil over the tank when he cleaned it. He
recalled this specifically, because this was unusual and access to the tank was
difficult.
The Case Manager discussed the appropriate depth for a septic tank with experienced
manufacturers and an installer, who said that most septic tanks are designed to be
buried 500mm below the surface. The manufacturers and installer said that, if a tank
was buried under approximately 2 metres of soil, as it was in this case, an obvious
result would be the collapse of the roof of the tank.
The Case Manager believed that the excess soil on the top of the septic tank led to the
collapse of the tank’s roof. Although C did not realise that this amount of soil over the
tank would result in the collapse of the tank’s roof, it is the cause of damage which
determines whether or not the loss is covered by the policy, not the discovery of the
loss.
Although C’s detection of the damage was sudden, the loss was as a result of a
gradual process. C’s policy did cover gradual damage, but only in specific situations,
which did not occur in this instance. Therefore, the loss was not covered by the
policy.

Result Complaint not upheld