A vehicle owner who challenged her insurer’s offered reimbursement has lost her dispute after an Australian Financial Complaints Authority (AFCA) determination backed the insurer’s decision.

The complainant lodged a claim following a collision that rendered her car a total loss. Pacific International Insurance agreed to cover the loss and offered a $7000 settlement, based upon the vehicle’s agreed value, with additional excess fees applied. 

The policyholder argues that the insurer’s offer undervalued the vehicle’s worth and would not have been enough to replace it. The insurer offered to renew the policy for an agreed value between $6890 and $9330.

The insured, who accepted a $7000 agreed value when she renewed the policy in October last year, says the insurer failed to provide her feedback or guidance about the offered amount.  

She says the car was worth between $12,000 and $14,000 and was wrongly valued because the insurer’s online sales website could not identify its unique model.  

But AFCA says Pacific International Insurance was not obliged to advise the complainant about the value she should agree to. It says the onus was on the claimant “to contact the insurer if she did not agree that the range of values offered reflected the value of the car.” 

The ruling highlights that the insurer’s website offers a “Can’t find your car?” option, which recommends that the customer communicate with the insurer to explore further solutions. 

“The make and model of the car was listed on the COI, as was the sum insured for that car,” AFCA said. 

“If the complainant had concerns that the amount of cover offered by the insurer did not reflect the value of her car, or that the model of the car was wrong, the onus was on her to contact the insurer to discuss the matter. 

“The insurer has offered to pay its maximum liability under the policy. Based on the exchanged material, I am not satisfied the insurer mis-sold the policy or led the complainant to believe that she was purchasing a market value policy.” 

The claimant also argues that the insurer “double dipped” by unfairly applying the additional excesses policies, which related to drivers who were under the age of 35 and held their licence for less than five years. 

But AFCA says the excesses were appropriately applicable in this claim’s circumstances, as the listed driver had been born in 2002 and held a provisional licence when the collision occurred. 

“I am not satisfied that the complainant has unfairly applied the additional excess amounts,” AFCA said. 

“In these circumstances it would not be fair to require the insurer to settle the claim for more than the agreed value.” 

Click here for the ruling.