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Claim Rejection Overturned

Mr. W. (insured) submitted a complaint against his insurer, Dial Direct Insurance, in respect of a vehicle hijacking incident. The insurer rejected the claim on the basis that Mr. W. did not provide true and complete information in respect of the sequence of events leading up to the incident. The insurer, in its response to the insured, referred to the policy wording which stated: “Your obligation: (1) give us true and complete information”.

Mr. W. advised that he was returning from his friend’s home, after watching sports on the television, in the early hours of the morning when a car stopped him and his vehicle was hijacked with him in it. The insurer found, during their investigation, that the insured had visited a pub prior to the incident. Mr. W. argued that he did not recall visiting the pub prior to the incident as the hijackers had drugged him.

The insurer advised that there was a high level of deception with regard to the insured’s version of events specifically with regard to where he was prior to the loss which prejudiced their validation of the incident. The insurer did not dispute that the vehicle had been stolen but argued that the insured had visited a pub prior to the loss, which he had not disclosed to the insurer.

Ombudsman’s Findings:

The Ombudsman pointed out to the insurer that in respect of the rejection on the basis of true and complete information the matter related to a hijacked vehicle, which incident the police had confirmed. The insurer could not persuade the office that it had suffered prejudice due to the insured not disclosing his visit to the pub. The insurer was reminded that the loss in this regard related to a hijacked vehicle and whether the insured had disclosed his visit to the pub prior to the loss or not was not material to the claim. The insurer then agreed to settle the claim.

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