Water, or another liquid, leaking or bursting from where it’s supposed to be contained is known as “escape of liquids” or EOL is insurance jargon, and it can cause a tremendous amount of damage to your home. EOL claims are now the second most common type of home insurance claim, accounting for 19% of Budget Direct’s claims between 2024 and 2026 and insurers report that the cost and frequency of these claims is rising.
If a pipe bursts and you’re not around to turn the water off, hundreds of litres of water can gush into your home, wrecking floors and ruining furniture and fixtures. A slow leak that’s hidden can cause structural damage and mould before you even realise it’s there.
10% of home insurance water damage claims in 2024 were caused by burst flexi-hoses
One of the drivers behind the rise in value and frequency of these claims is flexi-hoses – those braided steel hoses that are now underneath most of our sinks and behind appliances in our laundries, kitchens and bathrooms. According to Suncorp, 10% of home insurance water damage claims in 2024 were caused by burst flexi-hoses, with average claims of around $30,000 and 6% of flexi-hose claims totalling over $100,000.
So what should you be looking for in the EOL section of your home insurance product disclosure statement (PDS) to make sure your home is protected?
What does ‘escape of liquids’ cover?
EOL covers the repair of water damage caused by things like bursting pipes, leaking hot water systems or washing machines, overflowing baths and sometimes swimming pools. It doesn’t, however, cover fixing or replacing the item that leaked the water or other liquid, just the damage the liquid caused.
All the insurers in our comparison cover damage caused by sudden, accidental leaks or pipes that burst without warning, but 20% exclude cover for gradual leaks. The remaining 80% will cover the damage caused by slow gradual leaking, though only hidden leaks that a reasonable person wouldn’t have noticed. Gradual leaks can cause extensive damage too.
All the insurers in our comparison cover damage caused by sudden, accidental leaks or pipes that burst without warning, but 20% exclude cover for gradual leaks
Roughly 85% of insurers cover leaks from swimming pools and spas, while others exclude these entirely. Coverage here varies a little, so if you have a swimming pool it’s important to read the fine print in your PDS to make sure you’re covered for what could go wrong with your pool. Guild Insurance, for example, covers spas but not pools, and QBE will cover swimming pools for damage caused by EOL, but not caused by hydrostatic pressure.
Cover for aquariums, terrariums and landscaping equipment like garden hoses and watering systems also varies by insurer.
Leaky showers are generally excluded from EOL cover and unsurprisingly, damage from leaks that occur due to poor maintenance are excluded. Make sure you read the ‘escape of liquids’ section in your policy’s PDS to understand the ins and outs of your cover.
How does cover for escape of liquids vary?
Gradual leaks
The main difference within cover for EOL is whether a policy will cover for a gradual leak or not. Brands underwritten by Hollard (AHM, Australian Seniors, BUPA, CBA, Everyday, Huddle, and Real) completely exclude cover for gradual leaks entirely, limiting their cover to sudden one-off events only.
All the policies in our review with other underwriters do provide some cover for gradual leaks, generally for hidden leaks where the damage is not easily visible, or a reasonable person wouldn’t have noticed it.
Swimming pools and spas
If you have a swimming pool, it’s important to check that your policy includes cover for water leaking from your pool. Policies underwritten by Hollard exclude cover for pools and spas entirely. Those underwritten by Auto and General (Budget Direct, ING, Qantas and Ozicare) only include EOL cover for fixed plumbing, which would include in-ground swimming pools but not above-ground pools or spas. And Guild will cover spas but not swimming pools.
Which brands cover gradual leaks and swimming pools?
Underwriter
Brand
Gradual leaks*
Swimming pools**
AAI
AAMI
Covered
Covered
AAI
Apia
Covered
Covered
AAI
GIO
Covered
Covered
AAI
Suncorp
Covered
Covered
Allianz
Allianz
Covered
Covered
Allianz
Bank Australia
Covered
Covered
Allianz
Bank of Melbourne
Covered
Covered
Allianz
BankSA
Covered
Covered
Allianz
COTA
Covered
Covered
Allianz
Great Southern Bank
Covered
Covered
Allianz
HCF
Covered
Covered
Allianz
Hume Bank
Covered
Covered
Allianz
Kogan
Covered
Covered
Allianz
NAB
Covered
Covered
Allianz
National Seniors
Covered
Covered
Allianz Australia Insurance Limited
Over Fifty
Covered
Covered
Allianz
St.George
Covered
Covered
Allianz
TIO
Covered
Covered
Allianz
Westpac
Covered
Covered
Allianz
RAA
Covered
Covered
Auto & General
Budget Direct
Covered
Fixed plumbing only
Auto & General
Coles
Covered
Fixed plumbing only
Auto & General
ING
Covered
Fixed plumbing only
Auto & General
Ozicare
Covered
Fixed plumbing only
Auto & General
Qantas
Covered
Fixed plumbing only
Guild
Guild
Covered
No, but spas are covered
Hollard
AHM
Not covered
Not covered
Hollard
Australian Seniors
Not covered
Not covered
Hollard
Bupa
Not covered
Not covered
Hollard
CBA
Not covered
Not covered
Hollard
Everyday Insurance
Not covered
Not covered
Hollard
Huddle
Not covered
Not covered
Hollard
Real Insurance
Not covered
Not covered
IAL
AANT
Covered
Covered
IAL
ANZ
Covered
Covered
IAL
Australian Military Bank
Covered
Covered
IAL
Bank First
Covered
Covered
IAL
Bank of us
Covered
Covered
IAL
BCU Bank
Covered
Covered
IAL
Bendigo Bank
Covered
Covered
IAL
Coastline Bank
Covered
Covered
IAL
Defence Bank
Covered
Covered
IAL
Horizon Bank
Covered
Covered
IAL
MOVE Bank
Covered
Covered
IAL
MyState Bank
Covered
Covered
IAL
NRMA
Covered
Covered
IAL
P&N Bank
Covered
Covered
IAL
People First Bank
Covered
Covered
IAL
QBANK
Covered
Covered
IAL
Queensland Country Bank
Covered
Covered
IAL
Summerland Bank
Covered
Covered
IAL
The Capricornian
Covered
Covered
IAL
The Mutual Bank
Covered
Covered
IMA
RACV
Covered
Covered
QBE
QBE
Covered
Covered
RAC
RAC
Covered
Covered
RACQ
Aldi
Covered
Covered
RACQ
BOQ
Covered
Covered
RACQ
Honey
Covered
Covered
RACQ
RACQ
Covered
Covered
RACT
RACT
Covered
Covered
Youi
Youi
Covered
Covered
* Gradual leaks are only covered if they’re not easily visible, and a reasonable person would not have noticed them
**Conditions vary, read the terms in your PDS.
What can reduce your risk of water damage?
Know how to turn off your mains water supply. The shut-off valve is usually next to your water meter, and you turn this clockwise to shut off supply. Your water meter is usually near the front of your property, or it could be in a utility cupboard if you live in an apartment. Turning the water off quickly after a pipe bursts can drastically reduce damage.
Inspect your flexi-hoses. According to Suncorp’s Steven Hussey, “All it takes is 10 minutes every six months to pop your head under the sink and check to see if you can spot any fraying, rust, corrosion, kinking or twisting with your flexi-hoses. If you do, call a licensed plumber immediately to get them checked and replaced.”
Turn off your water when you go on holidays. Suncorp data shows that the cost of EOL claims, and hence the extent of the damage, increases exponentially during holiday periods when homeowners are often away.
Case study: Not just a leaky pipe
When investigating dampness and mould on the ground floor of the two-storey townhouse he shared with his partner, Mr Johnstone* discovered a burst hot water pipe under the floorboards. He called a plumber, who repaired the pipe to stop further water escape.
In the days after the plumber’s visit, the couple noticed structural timber warping and movement in the tiled flooring, walls and ceilings, as well as a strong smell of mould throughout the ground floor.
After the plumber’s visit, the couple noticed structural timber warping and movement in the tiled flooring, walls and ceilings
They lodged an insurance claim for this damage, thinking it was due to the leaking pipe. The insurer assessed the situation, and agreed to cover some of the claim under EOL. However, the insurer said the widespread mould, deterioration of subfloor timbers, and movement in walls and flooring weren’t caused by the liquid, but by other factors, such as inadequate subfloor drainage and ventilation, or long‑term moisture conditions.
Convinced that all the damage was caused by the burst pipe, the couple commissioned their own assessment of the damage, but their insurer wouldn’t budge, so they ended up taking their complaint to the Australian Financial Complaints Authority (AFCA).
AFCA concluded that the damage was indeed a result of the burst pipe, made worse by the fact that it was hot water and steam that leaked, and that there were no efforts made by the insurance company to dry out the area when the problem was first detected. The couple were awarded a settlement of over $150,000 to repair the damage, plus benefits for temporary accommodation, professional fees and stress associated with their claims handling process.
Jane Bardell is a Content producer in the Insurance and utilities team. She writes about home, car, pet and health insurance.
Previously at CHOICE, she checked facts, figures and statistics as a Verifier with the Editorial and investigations team.
Jane has a Bachelor of Science from the University of New South Wales. LinkedIn
Jane Bardell is a Content producer in the Insurance and utilities team. She writes about home, car, pet and health insurance.
Previously at CHOICE, she checked facts, figures and statistics as a Verifier with the Editorial and investigations team.
Jane has a Bachelor of Science from the University of New South Wales. LinkedIn
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