Leaking shower water damage: warranty, insurance and cost

A leaking shower can leak for a long time before anyone sees it. That makes it an awkward insurance claim and, in a bathroom built in the last few years, a much better builder’s warranty claim. Knowing which of the two you have is worth more than any quote, because the builder route can pay for the part the insurance route argues about.

Builder’s warranty or insurance claim?

The two can run side by side: the insurer on the resulting damage, the builder on the defective work. But the warranty clock runs from completion of the work, not from when you noticed, so the date the bathroom was finished is the first thing to find.

New South Wales: waterproofing is a major element

Read the definition closely before relying on the 6 years. Waterproofing is named as a major element, but a defect in it is only a major defect if it causes, or is likely to cause, the inability to use the building or part of it for its purpose, its destruction, or a threat of collapse. A shower you cannot use because it leaks into the next room is the kind of case the words point at; a hairline crack in grout may not be. Otherwise the period is 2 years. In a strata building, a failed membrane in common property is the owners corporation’s to repair (Strata Schemes Management Act 2015 (NSW) s 106(1)).

Queensland: water penetration is structural

That average is for bathrooms rectified under the home warranty scheme, so it describes defective bathrooms serious enough to claim, not every leak. It is still the clearest public figure for what fixing failed waterproofing properly costs, and it explains why the 6 years 6 months window matters.

Victoria: the implied warranties and 10 years

Victoria has no separate waterproofing category. What it has is a warranty in every domestic building contract that the work will be done in a proper and workmanlike manner and comply with the building laws, enforceable by later owners, and a 10-year limit on building actions from the occupancy permit or final inspection.

What the building code requires

That requirement is why a leaking shower is a defect rather than bad luck when the bathroom is recent: the code requires water to be kept out of the wall and floor cavities. AS 3740 is the standard the code points to; it is a paid Australian Standard and its text is not reproduced here.

The insurance claim

A shower is fixed apparatus that holds and carries water, so a leak from it is the kind of event the regulation names. The likely argument is about the exclusion in Insurance Contracts Regulations 2017 (Cth) reg 19(2)(b): wear and tear, rust or corrosion. A membrane that failed years after it was laid, or grout that perished, is where an insurer will say the cause was deterioration rather than an event. A policy may also have its own wording on gradual or repeated leaks; read yours, and its Key Facts Sheet, before you lodge.

Drying the damage around it

Whoever pays for the new waterproofing, the wet wall frames, subfloor and the room next door have to be dried before anything is closed up, or the new bathroom goes in over a mould problem. NSW Health’s position is that mould is likely to return unless you fix the cause. On the published rate card, two rooms dried over five days is $2,269 excluding GST; a subfloor or a wall cavity can add days. Ceiling water damage covers the stain that shows up in the room below, and mould removal covers what grows behind the tiles.

Common questions