Insurers Ordered to Compensate Despite Theft Claim Doubts
Insurers Ordered to Compensate Despite Theft Claim Doubts
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
The Australian Financial Complaints Authority (AFCA) has mandated that Insurance Manufacturers of Australia compensate a claimant whose car was stolen while it was parked at a friend's residence.
The policyholder filed a claim two days after her vehicle was reported stolen on March 23, 2022. She recounted purchasing the car from a friend, who is a certified motor mechanic, and leaving it at their house for servicing.
Insurance Manufacturers of Australia had raised numerous concerns about the circumstances surrounding the theft. These included a lack of proof of purchase and incomplete information about the vehicle's service history. The car was insured despite the new owner not driving it, which also raised suspicions. In addition, the friend did not cooperate with the insurer’s inquiries.
AFCA responded by stating that it is common for individuals to not have a purchase receipt when buying a vehicle privately. They accepted the bank statements showing a $35,000 transaction labeled "AA-Van" as adequate evidence of payment. They also acknowledged that service history details may have been in the vehicle at the time of theft.
The ruling emphasized that purchasing insurance was logical as it included coverage for non-driving events such as theft. While cooperation from the mechanic friend would have aided the investigation, it was not deemed a sufficient reason to reject the claim.
Concerns were also raised by the insurer about why the car remained with the friend for over nine months and inconsistencies in the car’s documented compliance and build dates. AFCA found no definitive reason for the extended storage but accepted explanations, such as Melbourne's lockdown and the complainant’s husband's health issues, as plausible.
The authority acknowledged a confusing situation regarding date inconsistencies but noted that the vehicle identification number (VIN) was consistent across documentation, thus confirming ownership and associated loss.
“Although it seems unlikely that a certified motor vehicle tester would make an error in the build date, it’s not an implausible mistake to make,” commented AFCA’s adjudicator.
Given all evidence, AFCA concluded that the complainant should be recognized as the owner who suffered a financial loss, and they instructed Insurance Manufacturers of Australia to accept the claim and process the payout.
For more details on the original case and ruling, refer to the Australian Financial Complaints Authority’s documentation.
Please Note: We do not endorse any specific products or companies. Some content is sourced from third parties, including press releases, and may not be independently verified for accuracy or completeness.
In response to the escalating cyber threats targeting strata communities, CHU Underwriting Agencies has expanded its residential strata insurance policies to include cyber protection. This enhancement provides coverage of up to $50,000 for losses resulting from social engineering fraud, a prevalent form of cybercrime where perpetrators impersonate trusted contacts to manipulate payment instructions. - read more
CHU Underwriting Agencies has announced a significant increase in its single risk capacity, raising the limit to $690 million from the previous $300 million. This substantial enhancement enables CHU to better support larger residential and commercial strata developments across Australia. - read more
CHU, Australia's leading strata insurance underwriting agency, has released its 2025 State of the Strata Market report, providing a comprehensive analysis of the current state of the industry. The report offers valuable insights into premium movements, the impact of weather events, regulatory developments, and emerging risks affecting strata insurance. - read more
The Australian Competition and Consumer Commission (ACCC) has intensified its examination of Insurance Australia Group's (IAG) proposed acquisition of RAC Insurance, moving the process into a Phase 2 review. This decision underscores the regulator's concerns about the potential impact on competition within Western Australia's insurance market. - read more
As 2026 unfolds, Australian insurers have identified premium affordability as the foremost risk facing the industry. This shift in priority reflects the mounting pressures from inflation, escalating climate-related losses, and stringent regulatory requirements. - read more
Comprehensive car cover is a type of vehicle insurance policy that provides the most extensive range of protection. It aims to cover a wide array of potential events that could affect your car. - read more
When it comes to car insurance for new drivers in Australia, navigating through the options can be overwhelming. Understanding the various factors that impact insurance premiums is crucial for making informed decisions. - read more
Car insurance customisation refers to the process of tailoring an insurance policy to fit the specific needs and circumstances of an individual driver or business. Unlike standard, one-size-fits-all policies, customised car insurance allows for the inclusion and exclusion of coverage options based on the unique requirements of the insured party. - read more
Welcome to our comprehensive guide on car insurance in Australia! Whether you're a seasoned driver or a newcomer to the roads, understanding car insurance is crucial for protecting yourself and your vehicle against unforeseen events. - read more
Car safety has come a long way since the early days of motoring. Initially, vehicles had minimal safety features, and accidents often led to severe injuries or fatalities. Over the years, technological advancements have significantly improved the safety of cars, making them much safer for drivers and passengers alike. - read more
Knowledgebase
Umbrella Policy: An additional insurance policy that provides extra liability coverage beyond the limits of the insured's primary policies.
No comments yet. Be the first to share your thoughts.