Case Studies
Explore Our Real-Life Case Studies Where We Uncovered Insurance Fraud and Buildling Faults for Body Corps and Pre Purachse Building Inspections
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Real Cases, Real Results: How We Uncovered Insurance Fraud
Insurance Fraud
Case Study: Investigation of Suspected Water Damage in Newly Laid Timber Floor
Claim Overview: A claim was submitted for water damage to a newly laid timber floor. The owner reported water ingress as the cause of the damage. The claim was made despite no actual evidence of water ingress being present. The insurance company requested an investigation to assess the validity of the claim and the cause of the floor damage.
Inspection Process and Findings:
Visual Inspection of Timber Floor:
- Observation: Upon inspection, it was noted that the timber floorboards exhibited significant capping and bowing, particularly in the middle sections of the floor. The damage appeared to be uniform across the affected areas, suggesting a consistent underlying issue rather than isolated water damage.
Assessment of Installation Practices:
- Movement Joints Examination: The investigation revealed that the floorboards were installed without the necessary movement joints near the corners and edges. Movement joints are crucial for allowing the floating floorboards to expand and contract with changes in humidity and temperature.
- Installation Deficiencies: The absence of these movement joints likely contributed to the observed capping and bowing. Without adequate space for expansion, the timber floorboards were unable to accommodate natural movement, leading to warping and distortion.
Water Damage Evaluation:
- Inspection for Water Ingress: A thorough inspection of the area and surrounding environment found no evidence of water ingress. There were no signs of moisture damage, staining, or other indicators that would suggest the floorboards were affected by water.
Conclusion: The investigation concluded that the damage to the timber floor was not due to water ingress. Instead, the issue stemmed from improper installation practices, specifically the lack of required movement joints. This installation error caused the timber floorboards to bow and cap, a condition unrelated to water damage.
Outcome: The claim for water damage was deemed invalid. The observed issues with the timber floor were attributed to installation deficiencies rather than water ingress. This case underscores the importance of proper installation techniques and thorough inspections to ensure that damage claims are evaluated based on accurate and relevant findings.
Case Study: Investigation of Suspected Water Damage Claim
Claim Overview: An insurance claim was filed for significant water damage to the ceilings throughout a residential property. The claimant reported that the damage resulted from heavy rain and leaks from tiles, which they claimed had been repaired and sealed by the owners. An investigation was requested to verify the validity of these claims.
Inspection Process and Findings:
Tile Condition Assessment:
- Observation: The inspection team examined the tiles in the areas specified by the claimant. Contrary to the claim, the tiles were found to be in their original condition, with no evidence of recent repairs or sealing. The condition of the tiles did not corroborate the assertion of ongoing water leakage.
Interior Ceiling Examination:
- Observation: The ceilings exhibited significant flaking of paint. However, no visible signs of water ingress were present on the gyprock ceilings. Normally, water damage would be indicated by yellowish stains or discoloration on the ceilings, but these were absent.
- Ceiling Insulation Check: Further inspection involved evaluating the ceiling insulation above the affected areas. There were no water stains or signs of moisture in the insulation, which would typically be present if there had been water ingress through the ceilings.
- Observation: The ceilings exhibited significant flaking of paint. However, no visible signs of water ingress were present on the gyprock ceilings. Normally, water damage would be indicated by yellowish stains or discoloration on the ceilings, but these were absent.
Paint Condition Analysis:
- Historical Context: The previous paint job used a lime-based paint, known for its porous nature and limited moisture resistance. The current paint flaking was likely due to the interaction between the lime-based paint and the new paint applied without adequate surface preparation.
- Current Paint Job Assessment: The recent paint application was performed without proper surface preparation, such as applying an undercoat. This lack of preparation compromised the adhesion and durability of the new paint, leading to the observed flaking.
Conclusion: The investigation concluded that the ceiling damage was not caused by water ingress from heavy rain or leaking tiles. The absence of water stains on the ceiling insulation and the condition of the tiles supported this finding. The observed paint flaking resulted from inadequate surface preparation and the use of lime-based paint, rather than external water damage.
Outcome: The claim for water damage was determined to be unfounded. The damage was attributed to painting defects rather than water ingress. This case highlights the importance of detailed inspections and accurate diagnostics in the claims process, ensuring that assessments are based on factual evidence and technical analysis.
Case Study: Ceiling Collapse in Main Living Room Area
Claim Overview: The insured person claimed that the ceiling collapse in the main living room area was due to a recent storm event. Upon investigation, it was determined that while the storm may have contributed to the collapse, it was not the sole cause. The primary issue identified was the insufficient or improper application of adhesive. Additionally, it was discovered that most other ceilings in the property had also detached but had not yet collapsed.
Inspection Process and Findings:
Visual Inspection of the Ceiling:
- Observation: The gyprock ceiling in the main living room area was found to be detached from the ceiling joists. This detachment was a significant factor in the collapse. Moreover, similar detachment issues were observed in most other ceilings throughout the property, although these ceilings had not yet collapsed.
Assessment of Adhesive Application:
- Adhesive Application Review: Examination of the provided photos revealed that the adhesive application was inadequate and did not meet the manufacturer’s guidelines. The adhesive coverage was insufficient, and the bonding process was improperly executed.
- Manufacturer’s Guidelines: According to the manufacturer’s guidelines, it is essential to apply an adequate amount of stud adhesive to the framing. AS/NZS 2589:2017 specifies that a daub of adhesive should be 25mm in diameter and 15mm in height on the framing member. The adhesive should be evenly spread and visible on both sides of the joist after plasterboard installation.
Conclusion: Although the storm may have played a role in the collapse of the main living room ceiling, the primary cause of the failure was defective building work, specifically the improper application of adhesive. The lack of proper adhesive application resulted in inadequate bonding of the gyprock to the ceiling joists. Furthermore, the fact that most other ceilings in the property had also detached, though not yet collapsed, indicates a widespread issue with adhesive application.
Outcome: The claim attributing the ceiling collapse solely to storm damage was deemed invalid. The collapse was primarily due to defective building practices, particularly the inadequate application of adhesive as outlined in AS/NZS 2589:2017. This case underscores the importance of adhering to proper construction standards and guidelines to prevent structural failures, even though external factors like storms can exacerbate existing defects.
Case Study: Unjustified Water Damage Claim in Commercial Property
Claim Overview: The insured party filed a claim for extensive water damage to a commercial property, alleging that the damage was caused by a malfunctioning air conditioning unit. They sought compensation for repairs to damaged walls, flooring, and furniture. The insurance company initiated an investigation to determine the legitimacy of the claim and whether the damage was indeed caused by the reported issue or other factors.
Inspection Process and Findings:
Initial Assessment of Water Damage:
- Observation: Water damage was observed on the walls, flooring, and furniture in several areas of the commercial property. The damage included water stains, bubbling paint, and warped flooring.
Assessment of Air Conditioning System:
- HVAC Inspection: The air conditioning unit was inspected to verify its condition and functionality. The inspection revealed that the HVAC system was operating correctly with no signs of leaks or malfunctions. The unit’s drainage lines and condensate pan were clean and properly maintained.
Further Investigation:
- Examination of Water Damage Patterns: The patterns of water damage did not align with what would be expected from an air conditioning unit malfunction. The damage was more severe in areas far from the HVAC unit, suggesting an alternate source of water.
- Building Envelope Check: A thorough inspection of the building’s exterior and roofing system revealed several issues. The roof had multiple small leaks and inadequate flashing around the perimeter. These leaks could allow water to seep into the building, particularly during heavy rain.
- Historical Maintenance Review: The building’s maintenance records were reviewed, revealing that there had been previous issues with roof leaks that had not been fully addressed. Repairs to the roof were incomplete, and there was no documented follow-up to ensure proper resolution of the problem.
- Tenant Interviews: Interviews with tenants indicated that the water damage had been gradually worsening over several months, which was consistent with slow leaks from the roof rather than sudden air conditioning failures.
Conclusion: The investigation revealed that the water damage was primarily due to unresolved roof leaks rather than a malfunctioning air conditioning unit. The damage patterns, maintenance history, and tenant testimonies all pointed to the building envelope as the source of the water intrusion.
Outcome: The insurance company determined that the claim for water damage due to an air conditioning unit malfunction was unjustified. The claim was not approved based on the findings. The insured party was advised to address the roof leaks and complete necessary repairs to prevent further water damage. Recommendations included professional roof repairs and regular maintenance to avoid future issues.
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Building Faults for Body Corporates
Case Study: Persistent Water Leakage in Shared Building Corridor
Claim Overview: A body corporate reported persistent water leakage in a shared corridor of a multi-unit residential building. The issue had been ongoing for several months, causing concerns about potential damage to the building structure and tenant complaints.
Inspection Process and Findings:
Visual Inspection of the Corridor:
- Observation: During the inspection, water stains and damp patches were observed on the walls and floor of the corridor. These signs suggested ongoing water intrusion, although the source was not immediately clear.
Assessment of Potential Causes:
- Roof Inspection: The roof was examined for possible leaks or damage. No obvious issues were detected, but the roof drainage system was noted to be partially clogged.
- External Wall Examination: The external walls were checked for cracks or gaps that could allow water ingress. Several small cracks were found, which were identified as potential points of entry for water.
- Internal Plumbing Check: The plumbing in the building was inspected, including pipes running through the corridor area. No leaks were detected in the internal plumbing system.
Further Investigation:
- Drainage System Analysis: A more detailed examination of the roof’s drainage system revealed that the gutters were not properly aligned, leading to inadequate water runoff. The downpipes were also found to be partially obstructed.
- Crack Assessment: The small cracks in the external walls were examined more closely. It was determined that these cracks had widened over time and allowed water to seep through, exacerbating the leakage issue.
Conclusion: The persistent water leakage in the shared corridor was primarily caused by a combination of factors: improper alignment and partial obstruction of the roof’s drainage system and widening cracks in the external walls. These issues allowed water to enter the building, leading to the observed leakage and damage.
Outcome: The body corporate was advised to undertake repairs to the roof drainage system and seal the external wall cracks. Additionally, regular maintenance and inspections were recommended to prevent future occurrences. Addressing these defects would mitigate further water damage and improve the overall condition of the building.
Case Study: Mould Growth in Tenant’s Apartment
Claim Overview: A tenant reported mould growth in their apartment, claiming that the issue was due to defects in the building’s construction or maintenance. The body corporate requested an investigation to determine the cause of the mould and assess whether it was due to a building defect or tenant-related factors.
Inspection Process and Findings:
Visual Inspection of the Apartment:
- Observation: Mould was found on the walls and ceiling in several rooms of the apartment, particularly in areas with poor ventilation. The tenant had placed several plants near the affected areas, which appeared to contribute to the problem.
Assessment of Potential Causes:
- Ventilation Check: The apartment was inspected for adequate ventilation. It was observed that several windows and vents were frequently kept closed or obstructed. This lack of ventilation could have contributed to high humidity levels within the apartment.
- Plumbing Inspection: The internal plumbing was examined, and no leaks or water damage were detected that could contribute to mould growth.
- Building Common Areas: The building’s common areas, including the roof and external walls, were inspected. No significant issues were found that could affect the tenant’s apartment.
Further Investigation:
- Tenant Practices Review: Interviews with the tenant revealed that they had been using a portable humidifier frequently and had not been regularly using the apartment’s built-in ventilation system. Additionally, the tenant had placed a large number of potted plants in the apartment, which can increase indoor humidity levels.
- Moisture Measurement: Moisture meters were used to measure the humidity levels in the apartment. It was found that the indoor humidity was significantly higher than recommended levels, likely due to the tenant’s use of the humidifier and lack of ventilation.
Conclusion: The mould growth in the tenant’s apartment was primarily caused by high indoor humidity levels resulting from tenant practices. The tenant’s frequent use of a portable humidifier, combined with inadequate ventilation and numerous potted plants, created an environment conducive to mould growth. There were no defects or maintenance issues with the building that contributed to the problem.
Outcome: The tenant was advised on proper ventilation practices and the potential impact of using a portable humidifier in conjunction with poor ventilation. The body corporate provided guidance on maintaining humidity levels and recommended that tenants ensure adequate airflow and avoid excessive use of devices that increase indoor moisture. No building-related defects were identified, and the tenant was responsible for addressing the mould issue by improving their apartment’s ventilation and reducing indoor humidity.
Case Study: Cracking and Movement in Common Area Flooring
Claim Overview: The body corporate received multiple complaints from residents about noticeable cracking and movement in the common area flooring of a high-rise residential building. Concerns were raised about potential defects in the flooring installation or underlying structural issues. An investigation was initiated to determine the cause of the flooring problems and assess the need for repairs or maintenance.
Inspection Process and Findings:
Visual Inspection of the Flooring:
- Observation: Cracks were observed in the common area flooring, particularly near the joints and transitions between different flooring types. There was also noticeable movement in certain areas where the floor seemed uneven.
Assessment of Potential Causes:
- Flooring Installation Review: The installation of the flooring was reviewed. It was found that the flooring had been laid over a concrete subfloor. The installation method included adhesive bonding and a leveling compound.
- Subfloor Inspection: The concrete subfloor was inspected for signs of moisture or instability. No significant moisture issues were detected, but the subfloor showed some signs of unevenness.
Further Investigation:
- Adhesive and Installation Check: Examination of the adhesive used revealed that it was not applied evenly, and some areas had insufficient coverage. This uneven application could lead to poor adhesion and movement in the flooring.
- Leveling Compound Assessment: The leveling compound used was found to have been applied in varying thicknesses, which might have contributed to uneven support for the flooring.
- Building Movement Analysis: A structural assessment of the building indicated that normal settling and movement of the building were within acceptable limits and were not contributing to the flooring issues.
Conclusion: The cracking and movement in the common area flooring were primarily due to improper installation practices. The uneven application of adhesive and inconsistent thickness of the leveling compound led to inadequate bonding and support for the flooring, resulting in visible cracks and movement.
Outcome: The body corporate was advised to take the following actions:
- Reinstallation of Flooring: Engage a professional flooring contractor to remove the affected sections of the flooring, correct the subfloor issues, and reinstall the flooring with proper adhesive application and leveling.
- Quality Control Measures: Implement stricter quality control measures during installation to ensure that adhesive and leveling compounds are applied evenly and according to manufacturer guidelines.
- Regular Inspections: Schedule regular inspections of common areas to identify and address any potential issues early.
Case Study: Water Stains and Damage in Common Area Lobby
Claim Overview: The body corporate received complaints about water stains and damage in the common area lobby of a multi-unit residential building. Tenants were concerned that the issue might be due to faulty construction or maintenance of the building. An investigation was requested to determine the cause of the water damage and assess whether it was a result of building defects or other factors.
Inspection Process and Findings:
Visual Inspection of the Lobby:
- Observation: Water stains and damage were observed on the ceiling and walls of the lobby area. The damage appeared to be concentrated around light fixtures and the edges of the ceiling.
Assessment of Potential Causes:
- Roof Inspection: The building’s roof was inspected for leaks or damage. Although the roof was in generally good condition, minor wear and tear were noted, but no significant issues that would explain the water damage in the lobby.
- Gutter and Downpipe Examination: The building’s guttering and downpipe system were checked. It was found that the gutters were clogged with debris, which could potentially lead to water overflow.
Further Investigation:
- Ceiling and Light Fixture Check: Closer examination of the ceiling revealed that water damage was most severe around light fixtures. The seals around these fixtures were found to be deteriorated, which could allow water to penetrate during heavy rainfall.
- Drainage System Analysis: The downpipes from the roof were partially obstructed, which could cause water to spill over the gutters and potentially enter the building through faulty seals.
Conclusion: The water stains and damage in the common area lobby were primarily caused by a combination of clogged gutters and deteriorated seals around ceiling light fixtures. The clogged gutters led to water overflow, which, when combined with the compromised seals, resulted in water infiltration into the lobby area.
Outcome: The body corporate was advised to undertake the following actions:
- Gutter Cleaning and Maintenance: Regular cleaning of gutters and downpipes to ensure proper drainage and prevent future overflow.
- Repair and Seal Light Fixtures: Replace or repair the seals around ceiling light fixtures to prevent water ingress.
- Routine Inspections: Implement a routine inspection schedule for common area maintenance to identify and address issues before they result in significant damage.
