A faulty door handle on a fire safety door led to an emergency callout, property damage and a liability claim against a joinery business.
In Episode 8 of Risky Business, Fran Eaton from DUAL New Zealand's Claims Team explains how the claim was assessed, how the Defective Materials, Design & Workmanship exclusion applied, and what brokers can learn about understanding resultant damage.
Who: A joiner who supplied and installed door handles for holiday accommodation.
What: The faulty handles prevented the door from being opened during an emergency, requiring the fire department to force it open.
Risk: Liability for the damage to fire door and the cost of rectifying the defective workmanship.
Outcome: The claim was largely covered, with the defective door handle component excluded.
The case demonstrates how General Liability policies respond when defective workmanship causes damage to other property, and the importance of distinguishing between the defective component itself and the resulting damage that follows.
Notify claims early: The insured notified DUAL immediately after receiving a letter holding them liable, allowing the assessment to begin without delay.
Understand how resultant damage provisions apply: While the component was excluded, the damage to the fire door was treated as separate resultant property damage and fell within the policy’s cover, subject to the applicable policy terms.
Provide clear, timely information: Prompt responses from the broker and insured enabled DUAL to assess the claim without appointing a loss adjuster, saving valuable time in reaching a settlement.
Ensure clients have appropriate General Liability cover: Trades and SMEs undertaking physical work can face unexpected liability claims. Understanding the cover in place, including relevant exclusions and exceptions, helps brokers guide clients through these situations.
Watch the full video to hear Fran explain how the claim unfolded and the key considerations for brokers.
Explore our General Liability insurance.
Connect with our NZ Claims team.
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