A driver who crashed into a fence during a mental health episode will be covered for his losses after the dispute authority rejected his insurer’s application of a reckless driving exclusion.  

The man lodged a claim after wrecking his Toyota Prius last February and admitted he had been checking a notification on his phone when the smash occurred.  

RAA Insurance declined the claim over the insured’s “wilful and reckless driving”.  

But the driver challenged this and referred to note from his psychiatrist stating he was “suffering from a manic relapse of schizoaffective disorder at the time”.  

The insurer acknowledged the note but did not comment on it.  

In its dispute decision, the Australian Financial Complaints Authority says that for the exclusion to be established, the insurer must show the complainant was “aware of the risk of his actions” and “deliberately courted the danger”.  

RAA said the man’s phone use demonstrated “a wilful and reckless disregard for his own safety”.  

But the dispute authority says: “While the use of a mobile phone when driving may represent negligence in the eyes of a reasonable person, there is no evidence to establish that the complainant was aware of the risk the use of the phone created, or that being aware of the risk the complainant ignored or courted the risk.

“The result is that the insurer has not established the application of the exclusion to deny the claim. The insurer is to pay the claim.” 

Click here for the ruling.