A woman who sought cover after losing a gold bar has been denied a payout in a complaints authority hearing, but she will receive $2500 compensation for her insurer’s handling of the claim.  

The insured claimed under her home contents policy in March 2023, but admitted she was unsure when and where she had misplaced the 10-ounce gold bullion.

She said she usually kept it in a cupboard but had put it in her handbag while workers were making repairs around her house.

A police report noted the woman may have dropped the item while shopping or at the home.  

IAG appointed an investigator because of the complainant’s prior claim history. The woman later dropped the claim, but she revived the issue last January. The insurer again engaged the investigator and declined a payout in May.  

The insurer said the loss was not covered under general contents because the gold had merely been misplaced. The bar was not covered under valuable contents because its loss did not fall under a specified list of events, and it was not included in a set of items eligible for portable contents cover. 

The claimant said she had believed she was covered for the gold “both at home and away from home” and that she should have been advised by IAG about her policy’s optional accidental damage cover. 

The Australian Financial Complaints Authority accepts the insurer did not mention the optional cover when the policy was arranged, but it notes this cover would not have applied given the unknown circumstances of the loss.

It backs IAG’s claim denial, saying the item was “lost rather than stolen ... either at the home or elsewhere”.  

“While the complainant has suffered a distressing loss both financially and emotionally, the circumstances of the loss fall outside the cover provided by the policy,” AFCA’s ombudsman said.

“The limitations in the policy were clear and it is fair that the insurer be entitled to deny the claim.”  

The authority also addresses the insured’s complaints about IAG’s handling of the claim, including accusations of bullying and harassment, delays and failures to contact her by email despite that being her preferred method of communication.  

The authority finds no evidence of bullying or harassment by the insurer’s representatives, saying conduct was “professional and none of the questioning was unreasonable”.

However, it notes an “undue delay” of 46 days between when the claim was revived and the investigator was appointed. It says this was avoidable, given the insurer was already familiar with the matter.  

It also notes the insurer’s repeated attempts to contact the woman by phone despite her informing it of her hearing impairment. It says IAG “was aware of the complainant’s vulnerability but on multiple occasions failed to communicate with her in a suitable manner”.

“Considering both the unnecessary delay in referring the claim back to the investigator and the repeated failures to use the complainant’s preferred contact method, the insurer’s handling of the claim has caused the complainant a more than usual degree of inconvenience, delay and loss of peace of mind,” the ombudsman said.  

Click here for the ruling.