Broker Not Accountable for Passing on Insurer's Instructions
Broker Not Accountable for Passing on Insurer's Instructions
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
An Australian homeowner's effort to hold his insurance broker responsible for allegedly misleading him about coverage for emergency tree removal has been dismissed by regulatory authorities.
The incident unfolded following a storm that impaired trees on the insured premises.
Initially, the homeowner looked to claim a compensation from the insurer for clearing debris. However, he was informed that his policy would not cater to the removal of trees unless they caused damage to the property itself. Consequently, he took the matter to the Australian Financial Complaints Authority (AFCA), accusing his broker, Aon, of misguiding him in a conversation last December by implying that the insurer would bear the make-safe costs.
The homeowner presented AFCA with an invoice totaling $17,217 for tree removal to establish safe machinery access and an additional invoice of $7370 for further clearance. Aon contested the claim, asserting that their broker merely communicated the details relayed by the insurer to the complainant.
Aon backed its position with contact notes from the insurer which included recommendations to "remove dangerous hanging limbs as part of a make-safe, ensuring photos were taken of the removed limbs."
Records show that the broker had questioned the insurer about the policy's inapplicability concerning make-safe operations. "Our client has now been informed by the assessor that this 'make-safe' work is not covered - surely this would be considered make-safe work, given the alternative risks, such as electrocution or being hit by a falling tree or limb?” Bhupendranathmmmsiddharth_techtw, the email to the insurer reportedly asked.
AFCA’s ruling underscored that although the homeowner conducted the work thinking it would be covered by the policy, the actions of the broker were not prejudicial. The authority noted that the broker had diligently informed the client to document the procedures, yet there was no indication that a more extensive range of work was covered under the existing policy terms.
AFCA summized that in this event The broker did not make any remark or conduct any act that was misleading and deceptive, as it merely transmitted the information received from the insurer and that had the information provided been inaccurate, the fault lies not with the broker, but with the original source of information.
Additionally, AFCA clarified that even in instances of potentially misleading information, the homeowner may not have sustained a financial loss since the insurer would likely have not compensated for the make-safe work under any circumstances. Regardless of the insurance policy specifics, the complainant was obliged to conduct the necessary safety works. Even if there was incorrect information passed from the insurer by the broker, the liability cannot be placed on the broker by simply relaying what they were informed.
This decision supports the conclusion that Aon, as a broker, carried out its duty by correctly conveying the insurer's instructions and therefore, should not bear the burden of liability for the disputed costs.
This case offers a valuable lesson in understanding where liabilities begin and end in the complex web of insurer-broker-customer communications, reminding policyholders to scrutinize the fine details of insurance contracts.
Original information for this article was sourced from Insurance News.
Please Note: We do not endorse any specific products or companies. Some content is sourced from third parties, including press releases, and may not be independently verified for accuracy or completeness.
New broker compliance data has put a spotlight on an issue that matters to every fitness professional who relies on public liability, professional indemnity or broader business insurance: renewal timing and communication. On 18 June 2026, Insurance Business reported that the Insurance Brokers Code Compliance Committee`s 2025 Annual Data Report recorded 5,417 breaches of the Insurance Brokers Code of Practice affecting 14,842 clients. - read more
Australian consultants rely on timely, accurate insurance renewals to keep professional indemnity, public liability and other business covers aligned with current contracts. A recent annual compliance update from the insurance broking sector has underlined why renewal discipline matters: missed or late renewal contact was reported as the leading category of broker code breaches for the past year. - read more
Build Australia’s latest construction technology coverage, published on 16 June 2026, highlights how geographic information systems, or GIS, are moving beyond digital mapping to become a practical project tracking tool for modern construction sites. The report frames GIS as a way to connect dispersed teams, complex schedules, site conditions and operational data into a shared spatial view, helping project leaders make faster and better-informed decisions. - read more
The liquidation of authorised representative network Sphere Insurance Group has put broker governance and client continuity back under the spotlight. According to early estimates reported by Insurance News, the failed network could owe more than $11 million to creditors, including insurers, underwriting agencies and a secured lender. The figures are preliminary and based on company records, with the liquidator still investigating the group’s financial position. - read more
Berkshire Hathaway Specialty Insurance (BHSI) has announced the promotion of Anna Spink to Head of Marine, Australasia. This strategic move underscores BHSI's commitment to bolstering its marine insurance operations across the region. - read more
Jetskiing is an increasingly popular water sport enjoyed by many Australians, with the country's vast coastline offering a playground for both adrenaline seekers and those looking to enjoy a day out on the water. In the excitement of zipping across the waves, safety can sometimes take a backseat, which should never be the case. Understanding and adhering to safety guidelines is crucial to ensure that every ride is as safe as it is enjoyable. - read more
Owning a jet ski can bring endless excitement and fun in the water, but it also comes with its own set of risks. Jet ski insurance is essential for protecting both your watercraft and yourself from unforeseen circumstances. - read more
Jet skiing is a thrilling water sport that has seen a surge in popularity across Australia's beautiful coastlines and waterways. With adrenaline-packed action and the joy of gliding over the waves, it's no wonder why so many Aussies are taking up the reins of these aquatic speed machines. The excitement of jet skiing not only provides an exceptional leisure activity but also offers a unique way to explore the stunning aquatic landscapes that Australia boasts. - read more
Jet ski insurance is an essential coverage option for anyone who owns a jet ski. While some jet ski owners may not see the need for insurance, it is important to understand the risks involved in owning a jet ski without insurance and the legal implications of not having coverage. - read more
Jet skiing is immensely popular in Australia, where the expansive coastlines and beautiful waterways offer the perfect setting for thrilling aquatic adventures. - read more
Knowledgebase
Grace Period: A set amount of time after the premium is due during which a policyholder can make a payment without the insurance coverage lapsing.
No comments yet. Be the first to share your thoughts.