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Insurance not placed

In July 2021 Sione contacted his insurance broker to say that he had sold his home and was looking to purchase a lifestyle block. Sione asked the broker to cancel the insurance on his home and gave the broker details of a property he was considering buying. Sione wanted to make sure he would be able to get insurance before making an offer to buy the lifestyle block.

The broker came back with an offer from an insurer, Sione was successful with his offer to buy the property and accepted the insurer’s offer. Sione told the broker he would be moving into the property on 20 August 2021 and the broker confirmed that the insurance would be effective from 20 August 2021. The insurer issued a certificate of insurance.

On 17 August 2021 New Zealand went into a level 4 lockdown and, on 18 August 2021, Sione advised the broker that he would not be moving into the property on 20 August 2021 as expected. Sione said he would contact her as soon as he knew the settlement date.

Sione moved into the new property on 4 September 2021 and thought that he had called the broker to confirm the settlement date.

In January 2022 the broker sent Sione renewal documents, asking him to check the insurance and listing cover for:

  • Sione’s rental property
  • two vehicles, at another address
  • contents insurance at the lifestyle property’s address.

The policy did not include house insurance for the lifestyle property. Sione replied to the broker that he was busy and had not had a chance to review the cover, but that he did not want to make any changes. The broker confirmed that insurance cover for the rental property, the vehicles, and contents was in place.

A month later Sione’s home was damaged by a storm, and he contacted his broker to lodge a claim. The broker replied that Sione’s home was not insured because he had not confirmed the settlement date. Sione was shocked. He was sure that he had called the broker to confirm the settlement date. Sione complained through the broker’s internal complaints process.

The broker’s company responded on the broker’s behalf saying they did not accept any liability for Sione’s loss. Sione then complained to FSCL.


Sione looked at his telephone records at around the time he moved into the lifestyle property but could not locate the call to the broker. Sione accepted that he may not have called the broker. Sione then accepted that the broker was not responsible for his loss. However, Sione felt let down by the broker.

Sione had been using the same broker for all his insurance needs for about ten years. Sione thought he had built up a relationship with the broker where she would look after him. Sione said the broker knew he had bought the lifestyle block and was just waiting for the settlement date. Sione expected that the broker might have systems in place to notice that the insurance had not been finalised.

Looking at the renewal notice and confirmation emailed to Sione in January 2022, Sione noted that the physical address on the documentation was the lifestyle block address and that his contents at the lifestyle block address were also insured. Sione felt this should have triggered the broker to ask more questions about the house insurance.

The broker company maintained their view that they were not responsible for Sione’s loss, but in the interests of resolving the complaint the broker offered Sione $500 as a goodwill gesture provided Sione acknowledged that the broker was not at fault.

Sione replied that he would accept the $500 but could not agree to the ‘no fault’ clause in the settlement agreement.


When we formally reviewed the complaint, we agreed the broker’s actions were not the primary cause of Sione’s loss. Sione did not tell the broker that settlement had taken place and did not notice the property was uninsured when he received the renewal notice and invoice.

However, we considered the broker could have provided Sione with a better level of service by following up with him once the Covid-19 alert levels reduced and by noticing that there were discrepancies on the renewal notice. The broker’s inaction contributed to Sione losing the opportunity to discover the insurance was not in place before the loss occurred.

We accepted it would have been very stressful and disappointing for Sione to discover the property damage was not covered by insurance. Our preliminary view was that the broker should pay Sione $1,500 as compensation for non-financial loss for the stress and lost opportunity.


Sione and the broker accepted our preliminary view, and the complaint was resolved.

Insights for consumers and participants

The relationship between the client and the broker carries with it responsibilities and obligations on both sides. In this case, Sione had some responsibility to check that his house insurance was in place and to communicate with the broker and correct the error. Equally, the broker could have provided better service and identified at an earlier date that Sione’s house insurance for his new property had not been arranged, leaving the property uninsured.