The insured’s rental property was contaminated with methamphetamine and so a claim was made to the insurer for the cost of the decontamination.  However, the insurer declined to meet the claim on the basis that there was no evidence of sudden damage to the house.  The policy provided cover for “sudden and unforeseen accidental physical loss or damage”.

The physical damage here was the methamphetamine contamination and that required decontamination.  The insured had to prove that the contamination occurred all at once to qualify under the “sudden” requirement of the policy.  There was no evidence that the contamination had occurred all at once and therefore the insurer was entitled to decline the claim.

When taking out insurance to cover such losses you need to be aware of what insurance is being purchased and the limits on that imposed by the policy wording.

Alan Knowsley

Insurance Lawyer