Media release: 27 November 2025
A forestry business caught in the chaos of Cyclone Gabrielle learned the hard way that acting before contacting your insurer can be a costly mistake—to the tune of $85,000.
Cyclone Gabrielle rendered some forestry skid sites unproductive in February 2023 due to damaged roads, bridges, and forests. A North Island forestry business caught in the aftermath with 19 heavy machines stuck in the forest, decided to relocate them to a more accessible site. Under normal circumstances, the forestry business’s client would have paid for the machines to be transferred to the next skid site.
The business claimed under their insurance policy for labour, machine running costs, accommodation, and vehicle costs associated with moving the machinery.
The insurer declined the claim because the policy only covered recovery expenses if the machinery was immobilised or inaccessible and unable to be operated under its own power. The policy also stated that the insurer had to give written permission before any recovery action was taken. The machinery could be moved with its own power, and the insurer was never contacted before the costs were incurred.
The complaint reached Financial Ombudsman Service, Financial Services Complaints Limited (FSCL), which agreed with the insurer’s reading of the policy.
“We understand that, when a cyclone hits, your priority is protecting your people and property,” says Susan Taylor, Financial Ombudsman. “Natural disasters bring urgency, but skipping the paperwork can lead to denied claims.
“If your insurance policy has strict conditions, even well-intentioned actions might not be covered. That’s the reality, and it catches people out”.
The Financial Ombudsman encourages all consumers and businesses to regularly review insurance policies, clarify unclear terms, and notify their insurer before taking any major action.
With Gabrielle’s impact topping $14 billion, and the likelihood of more severe storms ahead, these steps are critical for rural resilience.
Ends
Notes to Editors
*Names have been changed for privacy
Read the case note: https://fscl.org.nz/case-studies/claim-not-covered-under-policy-wording/
