A driver who collided with a vehicle in a club car park and then left the scene will have his claim paid after a dispute ruling found that his insurer was not entitled to deny it.

The complainant filed a claim, under his comprehensive Youi car insurance policy, on March 1 last year, after he was contacted by the owner of a club saying that he had hit another vehicle as he was leaving on February 28.

The claimant said he felt a “jolt” while exiting the car park but assumed his car had hit a nearby pillar rather than a vehicle and drove off from the scene.

The complainant returned to the car park after he was told that the third party’s car was damaged with a broken front bumper bar. He cooperated with the police, who were contacted by the club owner, and communicated the circumstances of the accident with his insurer.

Youi said the policy included exclusions for events where the driver leaves the scene of an accident “without lawful excuse”.

Relevant state legislature requires drivers to stop at a crash scene and provide details to the damaged party and police within the “required time” of the crash, usually as soon as possible, but in some circumstances it can mean up to 24 hours.

The insurer viewed CCTV footage of the accident that showed the complainant leaving the car park, turning left, before returning after completing a U-turn to exit.

It said the footage showed that the complainant drove past the damaged vehicle and would have been aware of the accident.

The complainant said he did not complete a U-turn to exit the car park and that his car had been parked in a two-car bay, which the insurer disputed.

Youi did not submit the CCTV footage to the Australian Financial Complaints Authority (AFCA) hearing but supplied a diagram that recreated the events. The complainant had also submitted a diagram detailing his explanation of events.

AFCA determined that the driver’s account was more likely to be accurate, saying his diagram had been consistent with the photo of the damaged vehicle and “based on his recollection of the events he experienced” rather than the insurer’s interpretation of CCTV footage.

It said that given the size of the claimant’s vehicle, it was not unreasonable to assume that he did not realise he collided with the car or see the extent of the damage.

AFCA said that the complainant provided his details to the third party and the police when he was notified of the accident and complied with the “required time” obligation of the relevant state laws.

Youi told AFCA that because the crash had not been immediately reported, it could not confirm that the man had not been under the influence of alcohol at the time of the accident, another exclusion included in the policy.

Under section 54 of the Insurance Contracts Act 1984 (Cth), insurers are entitled to decline claims if they have been deprived of the opportunity to determine if an exclusion is applicable.

The complainant said he had two or three alcoholic drinks over a period of four hours and ordered one for a companion. A receipt showed the man had purchased four drinks, which AFCA did not consider to be a significant difference between the complainant’s account.

It said the driver complied with state laws, given he was unaware of the accident, and that it was not fair for the insurer to “rely on prejudice”.

AFCA rejected Youi’s claims that the man had been uncooperative with the claims process, saying he provided the insurer sufficient details to help it assess the claim.

The ruling required Youi to accept the complainant’s claim and settle it within the terms of the policy.

Click here for the full ruling.