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Insurance Dispute Lawyers in Melbourne
We act for businesses whose insurance claims have been declined, underpaid or left unanswered. Business interruption, property damage, public and products liability, professional indemnity, directors and officers, cyber and construction. We act for the insured, not for insurers.
The policy is not the whole story
A denial letter is written to sound final. It quotes a clause, applies it to your claim, and closes. Read on its own terms it usually looks unanswerable, which is the point of it.
But the policy is not the only document that governs the claim. The Insurance Contracts Act 1984 sits over every contract of insurance, and it limits what an insurer may do with its own wording. Section 52 makes void any term that purports to exclude, restrict or modify the Act to the insured's prejudice. Section 13 implies into every policy a duty on both parties to act with the utmost good faith, and section 14 stops a party relying on a provision at all where relying on it would be a failure to act in that way.
That is the gap most declined claims are decided in: between what the policy says and what the insurer is actually permitted to do with it.
Testing the stated reason against the Act, not just the policy.
Indemnity periods, quantum and the arguments that follow.
Defence, indemnity and reservation of rights.
Claims made policies, notification and D&O.
Answering allegations about what was said at inception.
Where the cover was never placed as instructed.
The reason they gave may not be one they can rely on
Section 54 of the Insurance Contracts Act 1984 is the most powerful provision in Australian insurance law and the least understood by the people it protects.
It deals with the most common shape of a declined claim: the insurer says the insured did something, or failed to do something, after the policy started. Notified late. Did not comply with a condition. Made an admission. Failed to keep a record the policy required. Section 54(1) says that where the insurer would refuse to pay by reason of such an act, it may not refuse by reason only of that act. Instead its liability is reduced by the amount that fairly represents the extent to which its interests were actually prejudiced. If the prejudice is nil, the reduction is nil.
The question is not whether you breached the policy. It is what the breach actually cost the insurer.
Section 54(6) puts the point beyond doubt by providing that a reference to an act includes an omission, which is why late notification and failures to comply with conditions fall inside the section. Section 54(3) goes further: where the insured proves that no part of the loss was caused by the act, the insurer may not refuse to pay by reason only of the act. Section 54(4) applies the same logic to part of a loss.
There is a real limit. Under section 54(2), if the act could reasonably be regarded as being capable of causing or contributing to the loss, the insurer may refuse. So section 54 is not a cure for everything, and the analysis turns on the relationship between what the insured did and what actually happened. That is precisely the analysis a denial letter does not perform.
Late notification
One of the most common reasons given for declining a claim, and one of the weakest when tested. Because section 54(6) treats an omission as an act, late notice falls within section 54, and the question becomes what the delay actually cost the insurer rather than whether a deadline was missed.
Good faith runs both ways
Section 13(1) implies the duty into every policy and requires each party to act towards the other with the utmost good faith. Under section 13(2A) an insurer that fails to comply contravenes the Act and is exposed to a civil penalty. It is an obligation on the insurer, not just a standard the insured is held to.
Claims made policies
For liability policies where cover depends on notification, section 40(3) protects an insured who gave written notice of facts that might give rise to a claim, as soon as reasonably practicable after becoming aware of them and before the cover expired. The later claim is then not excluded merely because it arrived after expiry.
Test the denial, then price the dispute
Read the denial against the Act
The stated reason is the starting point, not the answer. We identify which provision the insurer is really relying on, whether sections 54, 14 or 28 constrain it, and whether section 52 makes the term void to the extent it tries to cut down the Act.
Establish what it cost them
Where section 54 applies, the outcome usually turns on prejudice: what was the insurer deprived of, and what is that worth. That is an evidentiary exercise, and it is where declined claims are won.
Escalate on the right track
Internal dispute resolution, the Australian Financial Complaints Authority where the claim is eligible, or proceedings. Each has different costs, timeframes and limits, and the choice should be made on the claim rather than by default.
Three fights worth knowing about
Most commercial claim disputes reduce to one of these.
"You did not disclose it"
For consumer insurance contracts the 2020 reforms replaced the old duty of disclosure with a duty under section 20B to take reasonable care not to make a misrepresentation, and section 20B(3) directs attention to matters including how clear and specific the insurer's own questions were. For other contracts, section 21 still applies but expressly does not require disclosure of matters that diminish the risk, are common knowledge, or that the insurer knows.
Commercial litigation"The policy does not respond"
Even where a failure is established, section 28 does not let the insurer walk away as a matter of course. Section 28(1) provides that the section does not apply at all if the insurer would have entered into the contract on the same terms and for the same premium anyway. Where it does apply and the failure was not fraudulent, section 28(3) reduces liability to the position the insurer would have been in, rather than extinguishing the claim.
Corporate law"Your broker should have told you"
Where cover was never placed as instructed, or the wrong product was arranged, the claim may run against the broker rather than the insurer, and often both need to be preserved at once.
Professional negligenceA straight read on the denial letter
Send us the policy and the denial. Initial consultations are confidential and run by senior practitioners who will tell you whether the stated reason holds up, and what the claim is realistically worth pursuing.
Book a consultationHow long you have to act
A claim against an insurer on the policy is an action founded on simple contract, and under section 5(1)(a) of the Limitation of Actions Act 1958 (Vic) those actions must be brought within six years from the date the cause of action accrued.
When time starts running in an insurance claim is not always obvious and can be argued about, so the safe course is to treat the denial as the moment to get advice rather than the moment to start waiting. Internal dispute resolution and external schemes run to their own separate timeframes.
Where the Act cannot be contracted out of
Insurers draft the policy, so it is reasonable to assume the wording decides everything. It does not. Section 52 provides that a term purporting to exclude, restrict or modify the operation of the Act to the prejudice of someone other than the insurer is void.
Section 55 confines the insurer to the remedies the Act gives it for an act or omission, rather than whatever the general law might otherwise have allowed. These are the provisions that make a denial letter arguable.
Trusted on the matters that mattered most
After speaking to many law firms, I felt that getting legal help was not for me. But my view completely changed after speaking with Special Counsel Peter Wood. He was knowledgeable, generous, kind, and genuinely caring. Peter listened with compassion and made me feel supported during a difficult time.
Highly professional, compassionate staff with a high level of knowledge and competence. Reliable, reassuring and there when you need them. Highly recommend.
Absolutely brilliant firm! Sarah was handling our matter and was incredibly thorough, communicative and clear from start to finish. Pentana Stanton really stood out as competent and integral in getting my matter resolved. I would highly recommend this firm.
Questions about declined insurance claims
Last reviewed August 2026. Statutory references are current to the Insurance Contracts Act 1984 (Cth) Compilation No. 32 (1 March 2024) and the Limitation of Actions Act 1958 (Vic) version 112 (25 February 2026). This page is general information, not legal advice.
Send us the policy and the denial.
If a claim has been declined, underpaid or left sitting, the two documents that matter are the policy and the letter refusing it. Send both and we will give you a straight read on whether the reason given can actually be relied on, and what the claim is worth pursuing.
See also: Professional Negligence, Commercial Litigation, Corporate Law, Investment Disputes.
