AFCA rejects ‘inexact proof’ of fraud in crash dispute
Allegations of fraud when denying claims must be supported by clear evidence, the financial services ombudsman has warned.
The comments come in a dispute decision involving a 1985 Holden Calais VK owner who said he was hit by another driver when he braked to avoid a kangaroo.
Suncorp’s AAI said the claim was fraudulent, but the Australian Financial Complaints Authority says the insurer has not established a basis on which it can deny a payout.
The insurer argued the classic car, with an agreed value of $85,000, was unlikely to have been damaged in the manner described, and the driver’s version of the accident was not credible. He had not been truthful and frank, it said.
The ombudsman says these are serious allegations.
“If established, they could have a major impact on the complainant’s ability to obtain insurance and, in some circumstances, finance.”
The insurer must provide information that is clear, cogent and persuasive, AFCA says. “Allegations will not be satisfied by inexact proof, indirect testimony, or speculation.”
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The insured said he was driving about 60km/h when the kangaroo forced him to brake suddenly.
He said the vehicle behind did not stop in time and hit the rear of his car, which was a total loss.
Insurers under the same group received claims from the two drivers. The ombudsman says forensic evidence AAI relied on came from a consultant appointed by the company covering the other driver. The investigator raised concerns about inconsistencies in the crash data and the other driver’s version of events.
But the ombudsman is not satisfied the Holden driver can be held responsible for issues the other vehicle’s insurer has with its policyholder.
There is no evidence the two drivers knew each other before the accident.
AAI must settle the claim and pay $2000 compensation for non-financial loss. It must remove from its records any reference to fraud or the complainant providing misleading and false information.
Read the ruling here.
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