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Determination
Case number | 12-00-1050361 |
Financial firm | Auto & General Services Pty Ltd |
Case number: 12-00-1050361 18 September 2024
The complainant holds a motor vehicle insurance policy with the financial firm (insurer). He lodged a claim after his car was stolen.
The insurer denied the claim. It determined that the car was left unattended, unlocked and with the keys inside. The insurer excludes losses which occur in these circumstances.
Yes. The car was stolen when it was left unattended and unlocked with keys inside. The policy does not cover a loss that happens in these circumstances.
The policy does not provide cover in the circumstances in which the theft occurred. It would be unfair to require the insurer to cover the loss.
This determination is in favour of the insurer.
The insurer is entitled to deny the claim and is not required to take any further steps in relation to this complaint.
Yes. The car was stolen when it was left unattended and unlocked with keys inside. The policy does not cover a loss that happens in these circumstances.
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.
If the complainant can do this, the duty shifts to the insurer to show, on balance, it is entitled to decline cover in line with the policy wording or otherwise.
In this case, there is no dispute the car was stolen and later recovered damaged. The policy covers theft as an insured event. This means the onus shifts to the insurer to show it is entitled to decline the claim.
The product disclosure statement (PDS) details the conditions of cover the complainant must comply with. These include:
You must ensure that:
…
The Conditions of Cover also clearly state the consequences for failure to observe these conditions:
If you do not observe the conditions of cover, we may reduce or refuse to pay a claim, or cancel the contract.
The policy does not define the term ‘unattended’. However, the courts have considered the term in relation to theft (the Starfire test). The Starfire test requires an insured person:
There is no dispute the complainant:
The complainant acknowledged that he left his car unlocked in the driveway at his parents’ home, with the key in the console (though not visible).
The complainant says that the car was not unattended because:
A person was in the vicinity of the Vehicle and able to observe the Vehicle at all times, including [the complainant’s sister-in-law] who was gardening, or myself and others who were situated in the lounge room in view of the Vehicle.
The complainant says at or around the time of the theft:
The complainant has provided supporting information including statutory declarations of family members and a friend, photographs of the lounge room showing the view of the driveway and CCTV footage of the car being stolen.
The insurer says the car was unattended because:
I am satisfied that the car was left unattended because the information the complainant has provided confirms that:
This means no one was taking reasonable steps to keep car under observation or had any real prospect of preventing unauthorised interference with the car.
The complainant cited examples of legal cases where claimants were found to have not left their cars unattended. I am not persuaded these assist the complainant in this case. For instance, the complainant says that he and others had the vehicle in view for the entire time. I consider this is inconsistent with:
The complainant also says that the fact that the car was parked on private property supports his contention that it was not left unattended. But the concept of leaving something unattended is not limited to leaving it unattended in a public place. For instance, something can be unattended if it is in a private location that is accessible to passers-by.
I am satisfied the insurer has established that the complainant did not meet all the requirements of the policy condition. The insurer is therefore entitled to decline the claim for theft and damage.
I acknowledge the vehicle has since been recovered and is damaged. However, the complainant breached the conditions of cover. This means the circumstances of the loss are still excluded under the policy.
I considered whether section 54 of Insurance Contracts Act 1984 (Cth) (the Act) could provide relief to the complainant. This states an insurer cannot refuse a claim in whole or in part by reason of some act (which includes an omission) that occurs after the contract of insurance was entered into unless it can show:
The act in this case is leaving the key in the unlocked and unattended car.
The complainant says that the car could have been stolen even if it did not have the keys in it. This is because:
I am not persuaded to the complainant’s point of view on this issue. The fact is the key was left in the car. Based on the exchanged information, I am satisfied that leaving the key in the car whilst unattended can reasonably be regarded as being capable of causing or contributing to the theft. This is consistent with:
Section 54(3) of the Act says the insurer may not deny the claim if the insured proves the act did not cause the loss. As the complainant has not proven that the car would still have been stolen if the keys were not left inside, section 54(3) does not assist him.
It is fair for the insurer to decline the claim.
The policy does not provide cover in the circumstances in which the theft occurred. It would be unfair to require the insurer to cover the loss.
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 of the information the parties have provided.
While the parties have raised a number of 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.
