What Should a Body Corporate Do When Mould Complicates an Insurance Claim?

Why mould makes a body corporate claim more complicated

Mould may develop after the event and remain hidden behind walls, under flooring or in adjoining lots. By the time it is found, different parties may give different accounts of its timing and cause.

The dispute may centre on:

• whether the moisture came from a sudden event or a longer-term building issue

• whether make-safe, drying or repairs occurred within a reasonable time

• whether damage worsened while the claim was being assessed

• whether the insurer’s inspections and testing were adequate

• which affected areas and repair items belong in the scope of works

Evidence may be spread across the strata manager, committee, building manager, lot owners and contractors. An assessor working from an incomplete history may not see the full building conditions.

Identify and stop the moisture source

Removing visible mould without addressing the moisture is unlikely to solve the building problem. The body corporate first needs a clear view of where the water is coming from and whether the source remains active.

This may require inspection of roofing, plumbing, waterproofing, balconies, drainage or building penetrations. Record what was observed, what work occurred and whether the cause was confirmed or only suspected.

Urgent work may be needed to protect occupants or prevent further damage. Where practicable, photograph materials before removal and retain the contractor’s records. The leak may need to be stopped while coverage remains under assessment.

Build one reliable claim record

Create one chronology covering the event, first water report, inspections, make-safe visits, drying, mould, occupant complaints and insurer decisions.

Preserve:

• dated photographs and videos of water entry, staining, mould and removed materials

• maintenance records for the affected parts of the building

• plumbing, roofing, waterproofing and remediation invoices

• insurer correspondence and telephone file notes

• moisture readings and drying logs

• previous building, engineering or defect reports

• work orders, scopes, estimates, decision letters and relevant committee minutes

Keep original files where possible and label evidence by building, lot, room and date. Previous reports may distinguish an older issue from new damage or show that an area was previously dry.

What to check in an insurer-appointed report

An insurer-appointed report can influence the claim, but it should be checked against the records and the inspection performed.

Confirm the event and inspection dates, affected areas and claim history. Check what areas were accessed and what documents or testing the author relied on.

Then review the reasoning:

1. Was the source tested or assumed? A conclusion about waterproofing, a roof leak or humidity should identify its supporting observations or tests.

2. Was the full damage inspected? Note adjoining rooms, cavities or common-property areas that were inaccessible or omitted.

3. Does the conclusion fit the timeline? Compare it with photographs, contractor visits, reports and moisture readings.

4. Was conflicting evidence addressed? A report should not ignore a plumber’s findings, leak-detection result or earlier building report pointing to another cause.

5. Does the scope follow the findings? Check whether supported investigation, removal, drying, remediation and reinstatement are included.

Common problems in reports and scopes

Look for errors that could affect causation, the damage or the proposed outcome:

• incorrect dates, locations or claim history

• damaged areas shown in photographs but excluded from the report

• assumptions made after limited inspection or testing

• opinions stated without supporting observations

• failure to address evidence that conflicts with the preferred conclusion

• mould attributed to maintenance without properly considering the reported event and later delays

• a scope omitting necessary investigation, removal or remediation

• inconsistencies between the report, decision letter and settlement proposal

Not every mistake invalidates an assessment. Focus on errors that could change how the insurer understands the cause, damage or repairs.

Put factual errors to the insurer in writing

A general statement that a report is “wrong” is easy to dismiss. Respond by identifying the page or section, stating the factual error, attaching the evidence and explaining why the issue matters.

For example, if a report records the first water notification as 18 March but a dated work order and photographs show water entry on 12 March, provide those records. Ask the insurer to have the author address the discrepancy and confirm whether it changes the opinion.

Separate confirmed facts from matters still under investigation and ask direct questions. This gives the insurer defined issues to answer and creates a record for any later escalation.

When further technical evidence may be needed

Independent evidence may help when the source, timing, extent or repair method remains disputed. Choose the expert for the unanswered question:

• a building consultant may assess building conditions, damage and repair requirements

• a leak-detection specialist may investigate the source and path of water

• a mould hygienist may assess contamination, moisture and remediation

• an engineer may be needed where structure, design or building performance is involved

• a suitably qualified trade may report on plumbing, roofing or waterproofing

Before commissioning a report, define the questions it must answer and provide the relevant chronology and documents. A focused report addressing the insurer’s reasoning is more useful than a broad inspection that misses the disputed points.

Technical evidence and claims advocacy are different

A technical expert investigates a building question within their discipline. A claims advocate reviews how the insurer assessed the decision, evidence, reports, scope and settlement. The advocate may identify gaps requiring further evidence but does not replace the building specialist.

Independent advocacy may be appropriate where:

• the claim has been significantly delayed

• the insurer’s report contains material errors

• relevant evidence has not been addressed

• the claim has been declined or partially declined

• the scope or settlement does not reflect the documented damage

Claimboost’s mould damage insurance claim advocacy is available for suitable disputed, delayed, declined or underpaid claims. Claimboost reviews the written decision, available evidence and proposed outcome before confirming whether it can assist. Advocacy does not guarantee that an insurer will change its decision.

Practical steps before escalating the dispute

Before lodging a formal complaint or seeking outside assistance, the body corporate should:

1. Stop continuing water entry and limit further damage.

2. Prepare a dated chronology of the event, inspections, drying, repairs and communications.

3. Collect the reports, scopes, photographs, readings and correspondence.

4. Compare the insurer’s account with the body corporate’s records.

5. Ask the insurer to explain its view of the cause, evidence and relevant policy wording.

6. Request that factual errors and missing evidence be referred to the report author.

7. Identify any question requiring independent technical investigation.

8. Review the written response before choosing further evidence, a complaint or claims advocacy.

Nominate one person to coordinate documents and correspondence, reducing duplication and inconsistent accounts.

When mould develops during a strata claim, stop the moisture, preserve the history and test the insurer’s conclusions against the documented conditions. Use technical evidence for disputed building questions. Consider claims advocacy where the issue is how the insurer interpreted the evidence or applied it to the decision, scope or settlement.