A complainant who claimed for injuries to his son-in-law following a water ski accident will not be covered after a dispute ruling sided with his insurer’s denial. 

The insured lodged the claim after his son-in-law, referred to as RD, suffered a finger amputation while water skiing. The claimant, who was controlling the boat, says the injury occurred after RD failed to get up on the ski and did not let go of the rope while the boat accelerated, causing his finger to be amputated by the rope or its handle. 

The complainant says his son-in-law’s loss of income and medical expenses should be covered by an optional cover he purchased under his boat insurance policy, which covers liabilities for water skiing and floatation device injuries.

IAG declined the claim on the basis that the insured was not responsible for RD’s accident and injury.

The insurer explained that the optional cover did not provide personal accident cover benefits but rather protected the insured from any claims against him for damages to property or injury caused by the usage of the boat. It agreed that it would compensate the policyholder if he had been found liable for RD’s losses.

The complainant agreed that he was not responsible for the accident but said that the policy did not clearly state that he had to be at fault for his claim to be accepted.

The Australian Financial Complaints Authority (AFCA) disagreed with the claimant’s argument, saying that the policy clearly referred to “liability”, which was consistent with the word’s defined meaning. 

AFCA accepted the insurer’s explanation for why the claim was denied and agreed that it was not required to cover the claim unless the complainant was found liable for RD’s loss.

“The optional cover purchased by the complainant states it extends the above liability cover to include property damage or injury caused to, caused by or arising from a water skier towed by the insured boat,” AFCA said.

“It is important to note this cover does not extend to a third party, such as RD. Instead, it covers the complainant if he is liable to a third party for loss, damage, death or personal injury.

“Given the complainant does not accept he is responsible, there is no basis for him to compel the insurer to accept RD’s losses.”

Click here for the ruling.