Flooding and extreme weather events have become a familiar part of life for many New Zealanders—and with them, an increase in insurance claims. But as pressures rise, so too does the temptation for some homeowners to overstate losses. The recent warning from the Insurance & Financial Services Ombudsman (IFSO) highlights why falsified insurance claims remain a serious legal risk, and why those wrongly accused of fraud also need robust support.
The Serious Consequences of Falsified Insurance Claims
In the RNZ article referenced here, the Ombudsman cautions that “providing false information can result in your whole claim being declined, not just the items that were inaccurately included”. This reflects a critical principle of insurance law: insurers must be able to trust the information provided by policyholders. Even small embellishments—such as extending a list of damaged items or guessing details without checking—can have significant consequences.
The case reported by the IFSO involved a homeowner who submitted a long list of household contents allegedly destroyed in the Auckland floods. An investigation later showed that many items were safely stored elsewhere. Her claim was declined, her policy cancelled, and the IFSO found she had acted “deliberately recklessly”. Notably, the consequences went beyond losing compensation; a finding of fraudulent conduct can also jeopardise a person’s ability to obtain insurance in the future.
For homeowners, the lesson is clear: accuracy matters. Policies often require claimants to take “reasonable steps” to verify information before submitting it. Even during chaotic post-disaster circumstances, insurers expect honesty and diligence—not assumptions.
When the Accusation Goes the Other Way
While genuine fraud is taken seriously, not every disputed claim stems from wrongdoing. Some homeowners find themselves accused of dishonesty when the real issue is misunderstanding, lost documentation, inconsistent recollections, or an insurer interpreting circumstances too strictly.
If you believe you are being wrongly accused of lodging a falsified insurance claim, you have legal rights and options:
- Request clarity on the insurer’s concerns, including the specific evidence they rely on.
- Provide supplementary information, such as receipts, photos, witness statements, or expert assessments.
- Seek a review through the insurer’s internal process or an external dispute-resolution scheme such as the IFSO.
- Obtain legal advice early, particularly if the insurer suggests fraud or threatens to cancel your policy.
Allegations involving dishonesty can have reputational, financial, and practical impacts far beyond a single claim. A calm, methodical response—guided by clear legal advice—can make a meaningful difference to the outcome.
Why These Cases Matter
Insurance operates on mutual trust. As the Ombudsman notes, “honesty is always the best policy”. But trust cuts both ways: insurers must assess claims fairly, and homeowners must present their losses truthfully. As severe weather events increase, so will scrutiny on claims—and so will the need for balanced, legally sound guidance.
Wynyard Wood advises homeowners, businesses, and insurers on issues involving falsified insurance claims, disputed assessments, and allegations of fraud. If you’re lodging a claim, disputing a decline, or facing an accusation, our Insurance Law team can guide you through your options. Contact us today for practical, informed support.
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