Two more Uber drivers have had complaints over denied claims knocked back because they failed to disclose to their insurer that they were using their vehicles for commercial ridesharing services.

These latest cases follow a similar case earlier this year.

The Australian Financial Complaints Authority (AFCA) has backed insurer Auto & General in all three cases.

In the latest rulings both drivers argued that section 54 of the Insurance Contracts Act prevents the insurer from declining the claim because their accidents took place while the vehicles were being used in a personal capacity.

AFCA agrees that “generally, where the act or omission relied on by the insurer was not capable of causing or contributing to the loss the insurer is prevented from declining the claim”.

However, it also says that section 54 is only relevant to acts or omissions occurring after a contract has been entered into.

Both drivers had started using their vehicles for ridesharing prior to renewal of their policies, and had not disclosed the change of use at renewal. Therefore section 54 “cannot be applied”.

The driver in the previous case made a claim during the first period of insurance, not after renewal.

That accident also occurred while the vehicle was being driven for personal use, but the insurer in that case, Auto & General, argued section 54 still would not apply because “the insurer’s liability in respect of the claim is reduced by the amount that fairly represents the extent to which the insurer’s interests were prejudiced”.

Auto & General said its prejudice was “the entirety of the claim”, because if the complainant had notified it of the change of use, it would not have been on risk when the loss occurred.

AFCA agreed with that interpretation. “The underwriting guidelines state the insurer would not have insured any vehicle that was used to carry passengers for reward,” it said.

“I am satisfied the insurer has established that it would have cancelled the policy had the complainant informed it of the vehicle’s change of use and would therefore not have been on risk for the vehicle at the time of loss.

“This means section 54 of the Act does not assist the complainant and the insurer was entitled to decline the claim.”