The owners of a luxury BMW that was wrecked in a high-speed crash have lost an insurance dispute after the driver was found to have recklessly caused the accident.

The BMW X6 Coupe hit a power pole and fence after the driver, referred to as N, lost control on a bend in Point Cook, Victoria, on October 29 2022.

The car, with a market value above $110,000, was a total loss.

A forensic crash investigator, appointed by Insurance Manufacturers of Australia, reported the vehicle had been travelling at 123kmh on impact and said the accident was caused by excessive speed. The speed limit in the area was 60kmh.

The insurer denied the claim on the basis the claimants engaged in wilful or reckless conduct that resulted in the loss.

The claimants did not dispute that N was going excessively fast but said the incident occurred due to negligent – not reckless – driving. They said N had thought she was travelling at the speed limit and had failed to see the bend in the road.

They said N had been unfamiliar with the engine’s power and accidentally hit the accelerator instead of the brakes after a commotion in the vehicle caused her son to yell.

Insurance Manufacturers of Australia said N was familiar enough with the road to know she was over the speed limit and should have taken greater caution given it was night, the road was poorly lit and it had recently rained.

The crash report showed the maximum speed for safely navigating the bend would have been 92kmh. 

The Australian Financial Complaints Authority says the insurance policy does not define “reckless”, so its adjudicator has relied on the Macquarie dictionary definition: “Utterly careless of the consequences of the action.”

It says N must have been aware of the risk of speeding and “knowingly or intentionally disregarded the risk associated”.

The dispute ruling acknowledges the driver was probably distracted by her son, which may have caused her to accidentally accelerate. However, it says the car must already have been “well above the speed limit” to then achieve its impact speed.

“The speed, the effort necessary to reach it, the conditions (being the unlit partially sealed road) meant that N was driving recklessly and exposed the vehicle, herself and the passengers, which included children, to exceptional danger,” the authority said.

“While not a wilful act, the information shows N was driving in a reckless manner due to excessive speed ... the insurer is entitled to exclude the claim under the policy.”  

Click here for the ruling.