Insurers Mandated to Fulfill Obligations Post Mine Collapse
Insurers Mandated to Fulfill Obligations Post Mine Collapse
Insurance companies have been directed to complete their responsibilities in restoring a critical piece of mine equipment that collapsed following initial repairs. This ruling comes after a legal contention over their payout duties.
Insurance providers Vero, QBE, and Singapore’s Star International Insurance contended that they were not accountable for the failure of a radial coal stacker during post-repair tests. The initial damage was covered under the industrial special risks (ISR) policy, held by Baralaba Coal Company.
The policy had expired by the time the final repair claim was made by the Queensland mine. However, the Federal Court determined that the insurers were still liable as the equipment had not been fully operational when the second failure occurred.
Justice Sarah Derrington, who presided over the case, stated in her ruling, “The additional damage sustained to the stacker after the insurance period concluded is irrelevant. The insurers’ duty to cover the reparation costs took effect during the policy period. Since the stacker was not restored to its pre-damaged state before the second collapse, the obligation persisted.”
The radial coal stacker initially suffered damage in March 2019, a month before the ISR policy expired. The insurers funded the initial repairs by September of that year. The equipment collapsed again in October during performance tests to verify the repairs.
Insurers argued that by October 27, 2019, the stacker was “substantially reinstated,” and the policy had lapsed by then. Therefore, they claimed that they were not required to cover the costs for the damages from the collapse.
In her decision, Justice Derrington refuted this viewpoint.
The insurers also pointed out that Baralaba Coal Company had signed a “form of release” related to the initial payout in June 2020, which they interpreted as absolving them from any subsequent liability from the storm and the collapse.
Justice Derrington countered, stating, “The context surrounding the creation and signing of the document indicates it was meant to settle the amount payable related to the storm damage from March 12, 2019. There’s no reason to believe it also covered the October 27, 2019, collapse.”
The court ruled that the insurers must cover the additional damages and the mine’s legal expenses. For a detailed understanding, you can access the ruling here.
Original article source: Insurance News Magazine.
Published:Tuesday, 25th Jun 2024
Source: Paige Estritori
Share this news item:
| AustralianSuper Announces Reduction in Default Income Protection Cover 20 Feb 2026: Paige Estritori AustralianSuper, one of Australia's largest superannuation funds, has announced a significant change to its default income protection insurance. Effective from 28 February 2026, the fund will reduce the default income protection cover to $1,000 per month. This adjustment aims to align insurance coverage with members' actual income levels and prevent over-insurance, which can erode retirement savings. - read more |
| APRA Postpones Changes to Individual Disability Income Insurance Policy Terms 20 Feb 2026: Paige Estritori The Australian Prudential Regulation Authority (APRA) has announced a suspension of the planned changes to individual disability income insurance (IDII) policy contract terms. Originally set to take effect from 1 October 2022, the implementation has been deferred for at least two years, providing insurers and policyholders additional time to adapt to the forthcoming regulations. - read more |
| Ocean Underwriting Expands Product Suite with Cyber Insurance for SMEs 20 Feb 2026: Paige Estritori Ocean Underwriting, in collaboration with Tokio Marine Management Australasia, has launched a new cyber insurance product tailored for Australian small and medium enterprises (SMEs). This addition marks a significant expansion of Ocean's offerings, which already include property, liability, and professional indemnity insurance. - read more |
| Club Marine Revamps Policies to Reflect Modern Boating Innovations 20 Feb 2026: Paige Estritori Club Marine, Australia's leading provider of recreational boat insurance, has undertaken a comprehensive review of its product disclosure statements (PDS) to better align with contemporary boating trends and technologies. This initiative reflects the company's commitment to staying at the forefront of the marine insurance industry. - read more |
| The Importance of Comparing Health Insurance Extras for Maximum Savings Health insurance is more than just a precautionary measure; it's a vital component in managing both your health and financial well-being. In Australia, where healthcare costs can quickly escalate, health insurance extras serve as a buffer, ensuring that services like dental, optical, and physiotherapy remain within reach. These extras can significantly reduce the out-of-pocket expenses you might otherwise encounter for non-hospital treatments. - read more
|
| Understanding the Tax Benefits of Income Protection Insurance in Australia When hardship hits and earning a steady income becomes a challenge due to illness or injury, income protection insurance steps in as a crucial lifeline. This insurance acts much like a monetary buffer, providing you with a percentage of your regular income during times when you're unable to work. It's designed to offer peace of mind and stability, not just for you, but also for your dependents who rely on your financial support. - read more
|
| Life Insurance: How much is enough? When considering life insurance, you're planning and preparing for an event that most of us would rather not think about. But life insurance represents a critical step in managing your personal finances and ensuring your family's well-being. - read more
|
| Understanding Income Protection Insurance: A Beginner's Guide for Australians Welcome to the essential guide on Income Protection Insurance for Australians. Whether you're just starting out in the workforce or you're well into your career, understanding how to protect your income is crucial. In this beginner-friendly article, we'll explore what income protection insurance is, why it's a vital safeguard for workers, and dive into some real-life scenarios illustrating its importance. - read more
|
A set amount of time after the premium is due during which a policyholder can make a payment without the insurance coverage lapsing.