The Australian Financial Complaints Authority (AFCA) has ruled a truck theft claim lodged with HDI Global Specialty should be paid even though the key was left with the vehicle when it was parked in the street overnight.

The claim was declined by the insurer on the grounds that the complainant had failed to take “reasonable steps” to secure the 2007 Kenworth K104 Prime Mover and was reckless by leaving the key with the truck.

The insurer also said it was the policyholder’s third stolen vehicle in five years and he had not changed business practices to mitigate against losses and had been put on notice that the security and protection of keys was of the “utmost importance”.

In the disputed claim, the vehicle had been driven from Larapinta to Crestmead in Queensland, where it was parked opposite a dairy factory in an area where the insured says it’s common to see more than 50 trucks in the street at night. The practice had been followed by the firm for two or three years to reduce drivers’ travel times.

The driver who delivered the prime mover had locked the vehicle, and AFCA heard he would leave the key on the vehicle’s turntable, in a hole, or somewhere where it was not clearly visible.

A different driver who arrived to collect the truck on September 11, 2019 discovered it was missing. The police were notified two days later but it was not recovered.

The policyholder says there’s no evidence the key was used for the theft, there is no reference to keys in the product disclosure statement, and argues that locking the vehicle and leaving it parked on the main street is not a failure to protect or safeguard the prime mover.

Keys were not left with the two previously stolen vehicles, taken in different circumstances, and those claims should have no weight in the current matter, it was argued.

The AFCA adjudicator says a limitation around taking reasonable care or precautions is not a test of what a hypothetical person would do, or should do, and it’s not a test to be applied with the benefit of hindsight.

“It is not enough to establish that the complainant failed to take any step or was negligent or careless,” the decision says.

“The test is a wholly subjective test. It requires; an actual recognition by the insured of the danger or the extent of danger and having recognised the danger, the insured acting either deliberately or recklessly to court the risk of danger.”

AFCA says it’s clear the policyholder did not consider the practice of leaving the key with the vehicle as dangerous and he had argued that many different truck operators park at the same location.

“The fact that the key was left on the vehicle, taking care to not be seen and locking the vehicle, is not enough to establish a failure to take reasonable steps or care,” the decision says.

AFCA was not swayed by decisions made by its predecessor that were referenced by the insurer, noting such determinations are not binding.

“In any event, this determination is consistent with the caselaw, other more recent AFCA decisions and the AFCA approach to reasonable care exclusions/conditions,” it says.

An assessor said the market value of the vehicle was $53,350 and recommended a settlement of $52,350 net of a policy excess of $1000.

The decision is available here.