Not upheld: unfair claim decline complaint against QIC Europe Ltd

Decision detail

Summary

Mr C and Mrs C complained that QIC unfairly declined a claim under their home insurance policy for damage to a mains water pipe. When Mr C discovered a leak and had a contractor investigate, the pipe was found to be rusted. QIC declined the claim under the accidental damage to mains services section, reasoning that rust represents gradual deterioration rather than accidental damage. The ombudsman examined the policy definition of accidental damage (requiring sudden, unexpected, and external damage) and the policy exclusion for gradual deterioration, and concluded that QIC's decision was fair. The ombudsman also examined alternative policy sections and found none provided cover for the damage to the pipe itself. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that rust is a gradual process that occurs over time and therefore does not meet the policy definition of accidental damage, which requires damage to be sudden, unexpected, and caused by something external and identifiable. The policy explicitly excludes loss or damage caused by gradual deterioration. The ombudsman also examined alternative policy sections (escape of water, trace and access, and home emergency) and found that none provided cover for the damage to the pipe itself. The ombudsman concluded that QIC fairly declined the claim based on the policy terms and the facts as presented.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website