Not upheld: unfair claim decline - escape of water complaint against AXIS Specialty Europe SE

Decision detail

Summary

Ms Q claimed for water damage to her property under her AXIS home insurance policy, alleging an escape of water from the shower area. AXIS declined the claim after investigation concluded the damage was caused by defective grout, seals and tiling in the shower enclosure allowing water to escape gradually over time, rather than from a sudden escape from pipes, tanks or apparatus covered by the policy. Ms Q disputed this, arguing the shower tray was faulty apparatus, there was a separate leak from pipework, and that faulty workmanship was not excluded under the Buildings section. The Ombudsman upheld AXIS's decision, finding the expert evidence supported gradual deterioration from defective shower enclosure components rather than an insured peril, and that policy exclusions only apply once an insured peril is established.

The Ombudsman's reasoning

The Ombudsman concluded that the available expert evidence demonstrated the damage was caused by defective grout and tiling in the shower enclosure developing gradually over time, not by a sudden escape of water from an insured peril (pipes, tanks or apparatus). The evidence did not support that the shower tray itself failed or that there was a separate insured leak from pipework. Policy exclusions only become relevant once an insured peril has been established; since no insured peril applied, the faulty workmanship exclusion was irrelevant. Trace and access cover only applies where an insured escape of water has occurred, so AXIS was not required to meet reinstatement costs once the underlying cause was found to be uninsured.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website