A man who lost his gold necklace at a beach has had a claims complaint rejected after he asked his insurer to increase its cover from $10,000 to $392,256.

His claim was accepted by Suncorp but limited to $10,000 minus a $1000 excess. The insurer noted this was the maximum amount for jewellery items under his contents policy, unless otherwise specified.

The insurer said that in conversations with the policyholder when he took out the policy, it informed him of policy limits. The man had suggested these would not be enough to cover his items. Suncorp said it told the man any items he wanted covered for more would have to be listed individually at a higher premium, but he had not done so.

The Australian Financial Complaints Authority’s ruling panel has confirmed through the insurer’s claim notes and call recordings that it took these actions.

Suncorp said its policy stipulated that “if you find that the flexible limits provided in your contents cover is not high enough you can adjust your cover by either selecting a higher level of cover or choosing to specify an individual item”. 

The insured argued the necklace should be considered an unspecified item and covered for its total value, given the policy covered losses of up to $600,000. He said in a previous claim with a different insurer, it had accepted a loss in full.

However, the authority panel has dismissed the man’s suggestion that the previous outcome is relevant to this matter. 

It says it would be unfair for Suncorp to increase its coverage after it clearly informed the claimant about the policy limitations.

“The essence of the complainant’s argument is that unspecified should mean any object, regardless of value, is covered by the policy – without itemisation or limitation,” the panel said.

“That would be an extremely generous way of reading a policy and its obligations on the insurer, and the panel does not accept this interpretation. The complainant was clearly aware through the quote process that further action was required by him if he wanted additional coverage for his gold jewellery. He was also aware that the premium would have been significantly higher if he were to take this option.”  

Click here for the ruling.