Will insurance pay for storm damaged ground in Victoria?

Evidence first

Tick this off before anything is repaired or thrown away

Claims for ground and water damage are won or lost on evidence collected in the first day, because once the hole is backfilled and the broken pipe is in the skip there is nothing left to prove. Work down this list in order. Tick boxes save in your own browser, and the print button gives you a paper copy for the site.

In the first hour, before anything moves

Photograph the damage from all four corners of the block before you shift a single item.
Take a slow phone video walking the site, saying the date, the address and what you are looking at out loud.
Photograph the high-water mark on the wall, fence or garage door while it is still visible.
Photograph the water meter dial and note the reading if a leak is suspected.
Only then do the make-safe work, and photograph that too so the insurer can see it was reasonable.
Ring the insurer the same day to open a claim number, even if you have not decided whether to proceed.

Measure it, do not estimate it

Depth of any subsidence or slump in millimetres, with a tape or a straight edge in the photo.
Length and width of every crack in millimetres, plus where it starts and stops.
Area of ground affected in square metres, worked out from two tape measurements.
How far the water travelled and where it entered the building, marked on a rough sketch.
Save the Bureau of Meteorology rainfall record for that date from the nearest station, as a screenshot with the date visible.
Note the time the damage was first noticed. Gradual damage arguments are beaten with dates.

Documents to pull together now

Your policy schedule, the excess amount and the product disclosure statement for your policy version.
Receipts for the last three years of gutter cleaning, drain clearing and grate maintenance.
Any earlier photos of the same area, including real estate listing photos, showing it was sound.
Building permits, engineering drawings and the soil report if the home is under about 15 years old.
Any previous building inspection or plumbing report that mentions the same area.

Keep it, do not throw it out

The failed section of pipe, cut out and bagged, with the date written on the bag.
Damaged pavers, edging or a sample of the failed backfill material.
The make-safe invoice, kept separate from every permanent repair quote.
Dump dockets for anything carted away, showing weight and date.

What to ask your contractor to supply

An itemised scope of works with quantities, not a single lump sum figure.
A plain-English statement of cause, saying what failed and why, on their letterhead.
ABN, a current certificate of currency for public liability, and workers compensation cover.
Progress photos during the work, especially of anything that gets buried again.
Compaction results for any backfill, so the repair cannot be blamed for the next movement.

Traps that sink claims

Do not authorise the permanent repair before the assessor has seen it or released you in writing.
Do not tell the assessor it has been like that for a while unless it genuinely has.
Do not accept a cash settlement before you hold your own itemised quote.
Do not let anyone backfill the hole until every photo and measurement above is done.

Covered event versus wear and tear, in plain words

Every home policy in Victoria is built the same way. It lists the events it will pay for, then it lists the causes it will not. Storm, rainwater and impact are listed events. Wear and tear, gradual deterioration, lack of maintenance, faulty workmanship, settling and shrinkage of the ground, and tree roots are the standard exclusions.

The practical test an assessor applies is simple: did one identifiable event on one identifiable day do this, or did it happen slowly? A downpipe that has discharged onto bare soil for six years and finally undermined a path is gradual damage, no matter how sudden the collapse looked. A 45mm storm cell that overwhelmed a properly maintained system and washed out a batter in an afternoon is a storm claim. Note that flood has its own standard definition in the Commonwealth insurance regulations and is usually a separate section of the policy: water escaping from a creek or lake is flood, water running off the surface of the ground during a downpour generally is not.

Two more traps are worth knowing before you ring. Retaining walls, fences, paths and driveways are often treated as outdoor items with their own sub-limit or excluded from some perils altogether, so a $9,000 retaining wall rebuild can come back with a $2,000 cap. And landslide or subsidence cover is usually conditional: it applies only where an insured event directly caused the movement and the movement shows up within a short window after it. If you are unsure which bucket your damage falls into, our guide to the signs of bad earthworks will help you tell defective work from a genuine weather event.

Make-safe, excess and the assessor

Make-safe is the temporary work that stops the damage getting worse: sandbags, a tarp over an open cut, a pump, temporary fencing around unstable ground, a diversion channel. Insurers expect you to do it, and they normally pay for reasonable make-safe even while the claim is still being assessed. Keep it proportionate, around $250 to $900 for a residential block here, and invoice it separately from the permanent repair so nobody can argue you started work without approval.

Then compare the excess with the repair. A typical Victorian home policy excess is $500 to $2,000. Regrading a yard and piping downpipes away is $1,200 to $3,500. Excavating and replacing a failed stormwater line is $2,500 to $6,500. Rebuilding a slumped retaining wall with proper drainage behind it is $4,000 to $14,000. Only the last of those is clearly worth a claim on a $1,000 excess once you allow for the effect on your renewal premium.

If it goes ahead, an assessor attends, and for ground movement the insurer will often also appoint a hydrologist or a structural engineer. Their report decides the claim, so be there when they walk the site, hand over your photos and rainfall record, and show them the drain that was clear. A scope of works is then written, either by the insurer’s builder or from your contractor’s quote. Read it line by line: the item that gets left out of the scope is nearly always the one that has to be done twice, and reinstatement, compaction testing and topsoil are the usual omissions.

Cash settlement or insurer-managed repair

A cash settlement pays you a figure and closes the file. It is calculated on the insurer’s panel builder rates, which are typically 10 to 25 per cent below what an independent contractor will charge you for the same scope, and once you sign it the shortfall is yours, along with anything nasty discovered when the ground is opened. Take cash when you already hold your own itemised quote and the offer beats it, or when you want to control who does the work.

Insurer-managed repair keeps the warranty with the insurer and removes the risk of an under-quote, but you get their contractor, their timetable and their material choices. On earthworks the risk is specific: panel scopes routinely price the trench and the pipe, and price the backfill as return of spoil. That is how you end up with a 60mm settlement trench across your lawn eighteen months later. Ask for compaction in layers to be written into the scope, whoever pays for it, and read backfill settlement and aftercare so you know what to insist on.

The honest advice

Do not lodge a claim on a repair that costs less than your excess plus the likely premium rise. Do not lodge one where the cause is plainly maintenance, because a declined claim still sits on your record and still gets disclosed at renewal. If we look at your site and the cause is a downpipe nobody ever connected, we will tell you that and quote you a $1,200 fix rather than help you write a claim that will be knocked back. If it is a strike on a buried service, our service strike page covers who wears that cost, and if it happened last night start with the emergency first-hour guide.

Insurance questions we get asked on site

Does home insurance in Victoria cover a blocked or collapsed stormwater drain?

It usually covers the damage the escaping water did, and usually not the drain itself. Most policies pay for water damage to the building and often contribute $500 to $1,000 toward locating the leak and getting access to it, then exclude the cost of repairing the failed pipe. Excavating to expose a broken line in Casey runs $700 to $1,800, so read the escape of liquid section of your product disclosure statement before you commit.

Will an insurer pay for subsidence or slumping ground on my block?

Only when a covered event caused it and only inside the time window the policy sets. Many Victorian policies cover landslide or subsidence only where it results directly from an insured event such as a storm and shows up within a short set period afterwards, which is commonly a few days. Ground that sank because fill was never compacted, because clay shrank in a dry summer, or because a leak washed material away over months is treated as gradual damage and declined.

What is a make-safe and who pays for it?

A make-safe is the temporary work that stops further damage, such as sandbagging, tarping an open cut, pumping out and fencing off unstable ground. Insurers expect you to do it and normally pay for reasonable make-safe even while they are still deciding the claim, so keep it proportionate and invoiced separately from the permanent repair. A typical emergency make-safe here is $250 to $900, and authorising it does not commit the insurer to accepting the rest of the claim.

How long does an insurer have to decide my claim?

Under the General Insurance Code of Practice, subscribing insurers decide a claim within 10 business days of receiving all the information they need, and respond to a complaint within 30 calendar days. If they need an expert such as a hydrologist or a structural engineer, the clock effectively restarts around that report. If you are unhappy after the internal complaint stage, the Australian Financial Complaints Authority is free for consumers.

Should I take the cash settlement or let the insurer manage the repair?

Take cash only when you have your own itemised quote in front of you and it is higher than the offer. A cash settlement is calculated on the insurer's builder rates, which are often 10 to 25 per cent under what an independent contractor charges, and once you accept it the shortfall and any further discovery are yours. Insurer-managed repair keeps the warranty with them, but you get less say in who turns up and when.

When is it smarter not to claim at all?

When the repair is close to your excess. Excesses on Victorian home policies commonly sit between $500 and $2,000, and a lot of yard drainage rectification lands at $1,500 to $3,500. Paying a $2,500 repair yourself instead of claiming a $1,000 net benefit is often the better call once you factor in the claim sitting on your record and the premium at renewal.

General information for Victorian homeowners, not financial or legal advice. Your policy wording and your insurer decide your claim.

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Will home insurance pay to fix storm damaged ground in Casey? What is covered and what is not