When the sum insured is not the sum insured – Implications of GST clauses in property policies

Property and ISR

When a loss exceeds the sum insured the deduction of GST from claim payments can be a source of contention between insureds and insurers.  However, there is surprisingly little case law on the construction of GST provisions in property insurance policies.  The Supreme Court of Queensland in Mattress Innovations Pty Ltd v MIB Insurance Brokers Pty Ltd & Anor [2013] QSC 028 recently considered the issue and, adopting a commercial approach, found in the insurer’s favour.

We discuss the Court’s decision in the attached alert.