Community Broker Network (CBN) has won a dispute lodged by a client who accused the authorised representative group of failing to properly arrange business cover for his truck as instructed, and claimed it was liable when a fire destroyed the vehicle and its contents.

The client, who uses the truck for his business, says he had told CBN over phone that the policy must also cover for tools and equipment plus hire vehicle expenses.

When he had to make a claim days after the Comprehensive Commercial Motor Vehicle Cover was incepted on May 6 2015, the insurer cash settled the complainant for the truck, which was subject to a total loss release.

The settlement however did not include hire vehicle expenses or contents that were inside the vehicle, leading the complainant to try to seek compensation from CBN through the Australian Financial Complaints Authority (AFCA).

In his complaint, the client says CBN had beached its duty and made an error but AFCA disagreed. AFCA says based on the evidence submitted from both parties, CBN had made the arrangements for cover in accordance with the information provided by the complainant on a fact finder sheet.

The fact finder sheet, which was used to record information as the policy was being arranged, showed the sections relating to transit cover and goods in transit was marked N/I, meaning not interested.

AFCA says the N/I markings showed the complainant did not ask for the additional covers.

“The complainant had the option at the inception to check the level of cover,” AFCA said. “If the complainant was dissatisfied with the level of cover, it had the option to raise specific items with the broker or seek cover elsewhere.

“Further, insurance policies do not respond to all types of loss. There are specific covers and exclusions in different policies.

“The fact certain parts of the complainant’s loss were not covered does not dictate that the broker has failed to arrange an appropriate policy for the business.”

AFCA says clients who buy business insurance are also expected to take reasonable action to ensure they have the cover they have sought. In this case, the complainant appeared not to have run through his copies of the Certificate of Insurance and Product Disclosure Statement.

“It was incumbent on the complainant to check the policy documents to ensure the policy was suitable,” AFAC said. “If the Certificate of Insurance contained errors or an incorrect level of cover, then the complainant should have advised the broker.

“Based on this, I am satisfied the complainant had the opportunity to check the level of cover. Further, the complainant had the opportunity to correct any errors.”

AFCA also dismissed the complainant’s bid to seek the maximum $5000 allowed under the compensation rules for non-financial loss. The mediator says the complainant, who first lodged the dispute with AFCA’s predecessor Financial Ombudsman Service in April 2018, had repeatedly failed to provide follow-up information on time.

Click here for the determination.