A motorist has lost a claims dispute with Suncorp after his vehicle was involved in a collision while on “laid up” cover.

The man – who argued that he didn’t know what laid-up cover was – had called the insurer on August 12 last year, saying he was paying too much to insure a car that wasn’t being driven.

He said his 2008 Ford Falcon had faulty transmission and had not been driven for six months.

The insurer said the car could be put on “laid up” cover, which would reduce the premium but meant the car was “not to be used under its own power”.

The man agreed to start this cover from August 23, but on October 30 drove into the rear of another vehicle on a public road.

He put in a claim but the insurer denied it, and the man took his case to the Australian Financial Complaints Authority (AFCA).

The complainant says the insurer, not him, suggested laid up cover, and he didn’t know what it meant. He says the insurer should have instead suggested covering the car for “extremely limited use”, which would have enabled him to use it twice a month.

But AFCA backed the insurer. It says the complainant didn’t ask what “laid up” meant and used the term himself.

“Having listened to a recording of his conversation with the insurer [on August 12] I am satisfied that he knew what laid up cover was,” the AFCA ombudsman said.

“At some point, the complainant started driving the car again without telling the insurer. He may have forgotten that it was on laid up cover.

“That is not the insurer’s fault. The insurer did not mislead the complainant or give him inappropriate advice. Therefore, the insurer is not required to accept the claim, or otherwise compensate the complainant.”

Click here for the full ruling.