We were recently appointed by a national insurer to check on a premises in the western suburbs of Sydney, where the Claimant alleged that the activities of New Years Eve, in particular fire works, caused irreparable damage to the building air conditioning system located on their roof. A total new air conditioning system was being claimed at a total cost, labour and materials of around $50K plus GST.
By way of background we were provided with various photographs showing extensive used fireworks on the roof, however no photographs were provided showing any damages to the air conditioning equipment. The Insured and broker were very forceful in their allegations and required immediate settlement of the claim.
The allegation by the Insured was that the perpetrators placed fireworks on top of air conditioning units located on the roof with the result that the heat and smoke from the fireworks, after they had been let off caused extensive damage to the air conditioning equipment.
When we arrived on site on our first visit we were not able to gain access to the air conditioning equipment located on the roof. We were advised that no access was possible and no ladders on site were available, this being contrary to advices initially provided to us when the matter was discussed with the Insured.
We were required to re-attend the site, this time bringing a ladder to gain access to the roof, which is located around four metres above ground. We also brought on site a specialist air conditioning technician, who proceeded to check the air conditioning equipment for electrical integrity. When on the roof we could not see any damage whatsoever to the air conditioning equipment that is consistent with fire, heat, burning, flames or smoke.
The air conditioning technician on site conducted various checks of the air conditioning equipment and determined that only one out of the four air conditioning units was working correctly and that the other three had various breakdowns in place including fusion of sealed compressor motors, fusion of condenser fan motors, problems with control systems and the like.
In summary the damages in place to the air conditioning equipment were due to general breakdowns and wear and tear and had nothing to do with the activities of New Years Eve.
The moral to the story is when a claim is received it is always important to conduct a site inspection and also view the equipment that is being claimed. When any doubt exists as to the cause of damages it is always advisable to have a specialist attend the site to do various checks of the equipment.
By the way, the Insured always maintained that the air conditioning was working fine prior to New Years Eve and that after New Years Eve the air conditioning equipment was not working. What do you think?
I hasten to add that this was an unusual circumstance as the writer’s experience is that information provided with the majority of claims is quite legitimate, though often knowledgeable interpretation is required.
PS: This claim was denied by the Insurer and no further representations were received from the Insured!