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Determination
Case number | 1067552 |
Financial firm | HDI Global Specialty SE |
Case number: 1067552 29 May 2024
The complainant held a comprehensive travel insurance policy with the financial firm (insurer).
The complainant lodged a claim for the theft of a bag and its contents by a tuk-tuk driver during an overseas holiday.
The insurer declined the claim on the basis that it falls outside the scope of cover provided by the policy.
No. Based on the available material, I am not satisfied, on balance, that the insurer has established the bag was left behind in any form of public or private transport or left unattended.
I do not accept the insurer has sufficiently established the application of a policy exclusion, Accordingly, it would not be fair for the insurer to be entitled to decline the claim.
This determination is in favour of the complainant.
The insurer is required to meet the complainant’s claim under the terms of the policy and in accordance with this determination.
The insurer is also to pay interest on the cash settlement amount in accordance with Section 57 of the Insurance Contracts Act 1984 (the Act) from 12 January 2024 (date of claim denial letter) until the date of payment of the claim.
No. Based on the available material, I am not satisfied, on balance, that the insurer has established the bag was left behind in any form of public or private transport or left unattended.
It is accepted insurance law that the complainant carries the initial onus to establish, on the balance of probabilities (that is, more likely than not), a loss which is covered by the terms and conditions of the policy.
Only if the complainant can do this, will the onus shift to the insurer to show, on balance, it is entitled to decline cover in line with the policy wording or otherwise.
The complainant held a comprehensive travel insurance policy for overseas travel from 25 December 2023 to 9 January 2024.
On 6 January 2024, the complainant lodged a claim for the theft of a bag and its contents. The claim description states:
On January 5th, around 7pm, we had been out in (C), shopping & visiting the old city. We had a small back pack & a light brown & black bag containing a small laptop, Apple Watch (no battery charge), 2 pairs of Prada sunglasses, a green moleskin notebook & a Montblanc ballpoint pen. We also had 2 shopping bags. We caught a tuktuk to a cafe - Tasty Coffee Shop - near our hotel where we could grab some food & drink and use WiFi for work. The tuktuk pulled over in the very busy street, the driver got out and took our bags out for us hastily, placing them on the narrow footpath. We paid and he left quickly as soon as we paid him. We realised he had sped off with the light brown bag containing the laptop etc and shouted after him to stop. He failed to stop and was gone in the traffic. This all happened in seconds. We went into the cafe to see if they could help but they couldn’t and then we went to our hotel. They advised us to go to the police station as the best option but suggested it would be difficult to locate the tuktuk on a busy Friday night. We went to the police station and reported the incident and was advised similarly, particularly as we were leaving today (6th). We did feel the driver knew he was leaving with our bag of valuables and made use of the busy roadside situation to enable him to do so…
The complainant reported the incident to the local police. He says the police suggested this was a common theft which would be difficult to follow up or prosecute. He provided a copy of the police report which states, in part:
There is a brown and black shopping bag…dropped off at the coffee shop, and the driver helped bring down other belongings, but did not take the shopping bag out of the car and drove away…
The complainant maintains his belongings were not unattended. He also says:
The complainant seeks a total amount of $6,378 for the various items.
Policy excludes cover for items left unattended
Section 10 of the policy provides cover for luggage and personal effects which are stolen or accidentally damaged during a journey, subject to the terms and conditions of the policy.
However, there is an exclusion under this section for items left unattended in any place, or left behind in any form of public or private transport:
We Will Not Pay
c) For loss, theft of or damage to Luggage & Personal Effects which occurred:
• while they were left Unattended in any place at any time, unless secured in Your accommodation (excluding shared accommodation or room such as a hostel, Airbnb or camp grounds), a safe or secure luggage locker;
…
• left behind in any form of public or private transport;
…
This section defines ‘unattended’ as follows:
‘Unattended’ means but is not limited to when an item is:
• not on Your person or under Your control at the time of loss;
• left with someone You don’t know;
• left in a place where it can be taken without Your knowledge including on the beach or beside the pool when You swim;
• left in a place where the item is out of Your sight; and/or
• left at a distance where You are unable to prevent the item from being unlawfully taken.
There is an alternative definition of ‘unattended’ in the policy which is outlined in section 3.2 of this determination.
The insurer submits that the claim arises directly from the bag being left behind in the tuk-tuk after disembarking and allowing the driver to unload the complainant’s luggage. The insurer originally declined cover on the basis that the items were ‘left behind in any form of public or private transport’, and therefore excluded under the policy.
The insurer later submitted and maintains the bag was left ‘unattended’ pursuant to the policy definition. The insurer says based on the complainant’s version of events, the bag was not at a distance where the complainant was able to prevent the items from being unlawfully taken, and the bag was left unattended for sufficient time for the loss to occur.
In addition to the policy definition of the term unattended, the term has been judicially considered in the leading case of Starfire Diamond Rings Ltd v Angel (the Starfire test).
In that case, the Court considered that for an object to be attended:
there must be someone able to keep it under observation, that is, in a position to observe any attempt to interfere with it and is so placed as to have a reasonable prospect of preventing any unauthorised interference with it.
I accept this does not require a continual observation or actual observation of the theft. It requires a capacity to keep the item under observation and a proximity such that you could attempt to prevent unauthorised interference.
The complainant rejects the exclusions relied on by the insurer. Having regard to the definitions of ‘unattended’ within the policy, the complainant says:
I am satisfied, on balance, that the complainant has shown he suffered a loss covered by the policy. The onus is on the insurer to show an exclusion applies.
I have carefully considered the information provided by the parties, together with the relevant policy definition for ‘unattended’ as well as the Starfire test.
When considering whether the policy responds to a loss claimed and the application of relevant case law or the terms of the policy, examination of the facts surrounding the loss in each case is necessary.
Given the circumstances of the complainant’s loss, I am not satisfied the bag can reasonably be accepted as being unattended. I consider the insurer’s application of the unattended exclusion to be too narrow and unreasonable and would remove the commercial purpose of the policy.
I accept the bag was stolen in the process of disembarking. The complainant’s evidence is consistent in confirming that the process of disembarking happened in a matter of seconds. This timeframe is significantly small. It is unlikely a reasonable person in the position of the parties would consider the items were left unattended in such a brief window of time.
The complainant was also reasonably close to the position of the bag at the time the theft occurred. The fact that other bags had been placed on the footpath does not mean it was outside the complainant’s immediate control and supervision.
Further, the complainant was at the very least able to raise an alarm with respect to the unauthorised interference with the bag by shouting at the driver to stop. I therefore do not accept the bag was left in such a position that he could not attempt to prevent any unauthorised interference.
Accordingly, I am not satisfied it has been established that the bag was left unattended at the time of its loss.
On balance, I do not accept the insurer’s position that the bag was ‘left behind in any form of public or private transport’. Firstly, there is no dispute that the bag was stolen; this is acknowledged in the insurer’s correspondence dated 25 January 2024.
I have also had regard to the principles of policy interpretation for the meaning of ‘left behind’, given it is not defined in the policy. The Macquarie dictionary states:
–phrase 3. left behind,
a. accidentally left as people move on.
Relevant to the circumstances of the claim, the complainant’s evidence is clear that the bag was not left behind in the tuk-tuk accidentally; rather, it occurred due to a theft.
Therefore, I am not satisfied that the insurer has established the application of this exclusion.
The result is that after careful consideration of all the available evidence and arguments, I do not accept the insurer has established any of the exclusions apply.
Accordingly, the insurer is not entitled to decline the claim. The insurer is required to indemnify the complainant for his claim under the terms of the policy.
The insurer is also to pay interest on any amount paid to the complainant pursuant to section 57 of the Act. Interest is payable from 12 January 2024 (date of claim denial letter) until the date of payment of the claim.
I do not accept the insurer has sufficiently established the application of a policy exclusion. Accordingly, it would not be fair for the insurer to be entitled to decline the claim.
AFCA has determined this complaint based on what is fair in all the circumstances, having regard to:
The respective parties have completed a full exchange of the relevant information, and each party has had the opportunity to address any issues raised. We have reviewed and considered all the information the parties have provided.
While the parties have raised several issues in their submissions, we have restricted this determination to the issues that are relevant to the outcome.
AFCA is not a court of law. We do not have the power to take or test evidence on oath, or to require third parties to give evidence.
When we assess complaints, we consider:
We give more weight to documents created at the time the events occurred. If there are no relevant documents, we will decide what most likely occurred based on the available information.
If there are conflicting recollections and these are evenly weighted, we may find that a claim cannot be established.
10. Luggage and personal effects (pages 23 to 25 of PDS)
‘Luggage & Personal Effects’ means any personal items owned by You and that You take with You or buy on Your Journey and which are designed to be worn or carried about with You. This includes items of clothing, personal jewellery, photographic and video equipment or personal computers, or electrical devices or portable equipment. However, it does not mean any cash, bank notes, currency notes, cheques, credit cards, negotiable instruments, Bicycles, drones, passports, business samples or items that You intend to trade.
…
‘Unattended’ means but is not limited to when an item is:
• not on Your person or under Your control at the time of loss;
• left with someone You don’t know;
• left in a place where it can be taken without Your knowledge including on the beach or beside the pool when You swim;
• left in a place where the item is out of Your sight; and/or
• left at a distance where You are unable to prevent the item from being unlawfully taken.
We Will Pay
We will pay the repair cost or value of any Luggage & Personal Effects which are stolen or accidentally damaged or are permanently lost during Your Journey.
When calculating the amount payable We will apply depreciation due to age, wear and tear. The amount of such depreciation will be determined by Us. No depreciation will be applied to goods purchased duty free prior to Your departure or goods purchased during Your Journey.
We will not pay more than the original purchase price of any item. We may repair or replace any item with an equivalent item at Our option, instead of paying You.
We Will Not Pay
…
c) For loss, theft of or damage to Luggage & Personal Effects which occurred:
• while they were left Unattended in any place at any time, unless secured in Your accommodation (excluding shared accommodation or room such as a hostel, Airbnb or camp grounds), a safe or secure luggage locker;
• left behind in any accommodation after You have checked out;
• left behind in any form of public or private transport;
• left Unattended in any shared accommodation or room (including but not limited to a hostel room and camp grounds) and not stored in a locked safe or locker;
• while they were left Unattended and visible in a motor vehicle unless they were left in a Concealed Storage Compartment of a locked motor vehicle; and/or
while they were left at, during or overnight in a motor vehicle even if they were left in a Concealed Storage Compartment of a locked motor vehicle.
Definitions (pages 55 to 58 of PDS)
‘Unattended’ means but not limited to, when an item is not on Your person at the time of loss, left with a person other than Your Relative or Travelling Companion, left in a position where it can be taken without Your knowledge including on the beach or beside the pool when You swim, leaving it a distance where You are unable to prevent it from being unlawfully taken.
