MGA Insurance

The most significant hidden danger facing plumbers currently might just be in your insurance policy wording.

What we’re seeing more and more from the insurance market is the exclusion of cover for work in buildings higher than two storeys. This is due to a large number of significant water damage claims in recent years (when we say significant, we’re talking hundreds of thousands of dollars of damage, even over $1 million).

What’s caused this risk?

There are two particular issues specific to this problem. One is burst flexi-piping causing water damage claims, and the other is where the crimping isn’t done correctly or as securely as what welding might have done. Obviously when you have a high rise, the bigger issues with a burst that occurs on the upper storeys impacts the levels below who then are making property damage claims against the plumber. Just this year, Suncorp (one of Australia’s largest home insurers) announced that burst flexi pipes now account for 1 in 10 water damage claims.

Then add to that, if you’re working in a commercial space, it’s not just home and contents claims, it’s loss of income, business interruption expenses, business relocation expenses and, probably the most significant claim we’ve heard of (seven figures) occurred in a building with highly sensitive and expensive government equipment (computer software, servers, etc) in the basement level – everything was fried due to the water damage.