The score sits at a one-all draw. IAG Insurance said there is no insurance cover. The Insurance Ombudsman said the Aubreys are covered for damage to the roof of their Twizel property. The High Court ruled insurance contract wording is unclear.
Problems followed construction of a new house for the Aubreys at Twizel in Canterbury through 2022. Contractors installing solar panels on the roof dented roofing sheets nearby, causing some $97,000 damage.
The Aubreys claimed on their NZI Contract Works policy, underwritten by IAG Insurance.
IAG declined cover. Fixing faulty workmanship is excluded, it said.
Contract works policies commonly exclude liability for faulty workmanship, otherwise insurers would be underwriting the competence of contractors and the quality of their work.
The Aubreys said their claim was not about how well the solar panels were installed; it was a claim for damage the contractors did to another part of the roof.
Discussions with IAG were deadlocked. The Aubreys took their claim to the Insurance Ombudsman: the Insurance and Financial Services Ombudsman Scheme.
The Ombudsman ruled in their favour.
As is its right, IAG asked the High Court to rule on the dispute. It was obliged to pay the Aubrey’s legal fees; part of the rules insurance companies agree to when signing up to the Insurance Ombudsman scheme.
IAG asked for a definitive Declaratory Judgments Act ruling on its insurance contract wording.
In the High Court, Justice Gendall said no ruling could be made on key phrases in the contract; a declaratory ruling having general application could not be made when each insurance claim is heavily fact specific, he said.
Justice Gendall ruled there was a lack of clarity in IAG’s insurance policy holding IAG liable for contractor’s damage to ‘separate insured property’ and ‘other parts of the same insured property.’
Left hanging is resolution of the Insurance Ombudsman’s and IAG’s differing views of whether damaged roofing panels adjoining the Aubreys’ solar panel installation are separate from the installation, or one and the same.
IAG New Zealand Ltd v. Aubrey – High Court (28.11.25)
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