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Insurer wrong to deny claim payment to single mum-of-three

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A single mother with three children and limited income has won a $7550 payout after a claim dispute over the theft of her Ford Territory.

The woman, who held a policy with RAA and was trying to sell her car, left it parked on the side of a road on January 26, locked and secured with ‘For Sale’ signs displayed so it could be seen by passers-by.

She last saw the car at around 5.30pm and later that night, contacted RAA to confirm her motor insurance was up to date.

She told the Australian Financial Complaints Authority (AFCA) she was concerned about whether she had paid her insurance having had to leave the car on the roadside as her young daughter fell asleep and couldn’t be left alone, so she could not move it.

“This is not an unreasonable position for the complainant to adopt, given she was a single mother with three children and had limited income at her disposal,” AFCA said.

“She has been open and honest in her answers with respect to her prior history. There is no information to attack her character or credibility and no other information to link the complainant to the destruction of her vehicle.”

Early on January 27, the woman was notified by police that the car had been located damaged and she lodged a claim for theft.

The policy was a comprehensive insurance policy covering her 2008 Ford Territory for an agreed value of $8,050, subject to a $500 excess. The policy provided cover for malicious damage and loss or damage caused by theft or attempted theft.

RAA denied it, saying it was unlikely a thief stole a second key to the car and then stole the vehicle because the vehicle was not at the woman’s residence.

“I agree this is unlikely. However, it is certainly possible that, if the vehicle was left at the side of the road unlocked, a thief or thieves could have entered the vehicle and accessed the second key, if the key was left in the vehicle,” the AFCA ombudsman said.

The woman said she had been given two keys when she purchased the Ford in in March 2018 but told RAA she could only locate one of the keys. It was possible she had left a second key in the car with other items.

A forensic report from a locksmith engaged by RAA found no sign of forced entry to the vehicle and the immobiliser system had had not been defeated.

It concluded the car was most likely driven to the recovery location by a person having accessed a correctly programmed key.

“This does not necessarily mean that the complainant drove the vehicle to the recovery location or provided an unknown person access to a correctly programmed key,” AFCA said.

In the weeks prior to the theft the woman advertised her vehicle for sale for $8,000.

“I accept that the complainant was seeking to sell the vehicle at the time of the loss and this raises a possible financial motive. However, there is no suggestion that the vehicle was superfluous or that the complainant would not need to replace the vehicle. The vehicle was essential to transport her three children,” the ombudsman said.

RAA said the woman deleted several SMS messages from her phone. She provided AFCA with a copy of messages to the father of her children the morning after the vehicle was stolen and explained she deleted messages to save memory on her phone.

“There is no suggestion that the complainant had misled the insurer in any way with respect to her financial position, her claims history or other history. There is no suggestion that the complainant had any relevant prior criminal or insurance history that would suggest she was a moral risk.

“Other than the forensic report, little information has been provided by the insurer to challenge the complainant's claim that the vehicle had been stolen from the roadside where it had been left,” AFCA’s ruling says.

AFCA says RAA must settle the claim for $7550 but did not award the woman the further compensation she sought, saying there was no evidence RAA’s investigator was intentionally rude or inconsiderate when dealing with her.

See the full ruling here.