Glenn William Starr v Insurance Australia Limited [2017] NSWDC 284

Glenn William Starr v Insurance Australia Limited [2017] NSWDC 284

The NRMA policy is a contract of indemnity, not agreed value. Upon the plaintiffs’ rejection of the insurer’s builder for reinstatement, the insurer was obligated to pay the reasonable cost to rebuild, not the sum insured, as the loss did not equal or exceed the sum insured. The PCR quote of $494,414 represented the reasonable cost. The defendant therefore fulfilled its obligation, and the plaintiffs are not entitled to any additional amount.

Parties
First Plaintiff: Glenn William Starr; Second Plaintiff: Tanya Nieuwendyk; Defendant: Insurance Australia Limited
Jurisdiction
Australia
Judgment Date
20 October 2017
Procedural Posture
Civil / Trial Judgment
Outcome
Judgment for the defendant.
Legal Topics
Indemnity Insurance, Home and Contents Insurance, Reasonable Cost of Reinstatement, Construction of Insurance Policies
Insurance Law Contract Law Indemnity Insurance Home and Contents Insurance Reasonable Cost of Reinstatement Construction of Insurance Policies

Case Brief

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Parties

Glenn William Starr

First Plaintiff

Tanya Nieuwendyk

Second Plaintiff

Insurance Australia Limited

Defendant

Procedural Posture

Civil / Trial Judgment

Legal Issues

  1. 1 Whether the plaintiffs are entitled to the full Buildings sum insured or only to a reasonable cost of rebuilding under the policy
  2. 2 Whether the sum paid by the insurer constituted the reasonable cost of rebuilding the home and pool

Ratio Decidendi

The NRMA policy is a contract of indemnity, not agreed value. Upon the plaintiffs’ rejection of the insurer’s builder for reinstatement, the insurer was obligated to pay the reasonable cost to rebuild, not the sum insured, as the loss did not equal or exceed the sum insured. The PCR quote of $494,414 represented the reasonable cost. The defendant therefore fulfilled its obligation, and the plaintiffs are not entitled to any additional amount.

Court Disposition

Judgment for the defendant.

Orders

  • Judgment for the defendant.
  • The plaintiffs are to pay the defendant's costs.