Tool Theft Claim Falls Short After Portable Items Limit Applied

The policyholder lodged the claim on 18 December 2025. QBE later paid $14,000 for the stolen tools under the portable items section of the policy, plus $9,446 for business interruption over the period from 18 December 2025 to 16 January 2026. The business argued the stolen contents were worth about $120,000 and that the policy included $100,000 for theft of contents. It also sought $28,000 for the trailer and a larger business interruption payment.

AFCA backed the insurer’s position. A key issue was where the items were located when they were stolen. Because they were not at the nominated business premises, AFCA accepted that the portable contents limit applied rather than the broader contents sum insured. The trailer was also not covered because the policy excluded vehicles of that type.

For tradespeople, the lesson is practical rather than legalistic: tool theft cover is not always the same thing as contents cover. Many tradies move expensive gear between homes, depots, utes, trailers and worksites. If the policy treats those locations differently, a claim can be capped even when the total insured value looks healthy on paper.

Before renewing or buying trades insurance cover, tradies should check:

• whether tools are covered away from the listed business premises;
• the maximum payout for portable items, including any per-item limits;
• whether overnight storage in a vehicle, trailer or job site container is restricted;
• whether trailers need separate cover under vehicle, plant or equipment insurance;
• how business interruption losses will be assessed if stolen tools stop work.

The decision also highlights the importance of keeping written records. The business said it had been led to believe the tools would be covered under the contents sum insured, but AFCA found there was not enough evidence to prove it had been misled. Where cover is arranged online, there may be little record beyond the documents issued at purchase.

For sole traders and small crews, a tool theft claim can quickly become a cash flow problem. The best time to test assumptions is before a loss occurs. If policy wording is unclear, speaking with a licensed broker can help identify gaps between how a tradie works day to day and how the insurer defines the risk.