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Claimant wins motor dispute despite breaching alcohol limit

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The Australian Financial Complaints Authority (AFCA) has ruled against Hollard in a dispute involving a NSW customer whose claim for vehicle damage was denied because he failed an alcohol breath test that was taken right after an accident.

AFCA agrees the evidence produced supports a conclusion the complainant’s blood alcohol content was above the legal limit of 0.05 grams per 210 litres of breath but says Hollard did not provide information that proved he was under the influence of alcohol.

Hollard had engaged a forensic pathologist to help review the claim after obtaining a copy of the police report, which contained results of two breath tests taken by the complainant after the incident in January. A provision in the NSW Road Transport Act bars insurers from denying claims solely on the basis of breathalyser results so forensic experts are usually hired to provide independent assessments.

The pathologist studied the police report, which found the alcohol level was 0.055, and concluded the complainant’s actual alcohol level at the time of the accident on January 14 likely exceeded 0.08. She reached her conclusion based on what the complainant said he had eaten before the crash and the time of the breath test. He admitted he drank a bottle of beer within half an hour of the accident.

The pathologist also concluded the insured would have been affected by alcohol while driving and this would have contributed to the collision with another vehicle.

Hollard subsequently moved to deny the claim, relying on an exclusion in the policy that states losses will not be covered if a driver is under the influence of any drug, alcohol and/or whose blood alcohol level is over the legal limit.

But AFCA is not satisfied with what the insurer has provided to support its case for denying the claim.

“The issue is whether the complainant was under the influence of alcohol and/or over the limit of .05,” AFCA says in the ruling. “It is not contradicted that the complainant had a blood alcohol level over the legal limit at the time of the accident.

“In the absence of any information showing the complainant was under the influence of alcohol at the time of the accident, [the pathologist’s] opinion is based on assumptions which are not supported by any direct evidence.

“The insurer cannot deny the claim on the basis that complainant was under the influence.”

A spokesman for Hollard told insuranceNEWS.com.au the insurer prefers not to comment on individual cases.

A lawyer who declined to be named says the AFCA ruling is a useful reminder to insurers of the challenges involved in denying a claim based on the drink driving exclusion.

Insurers need to take a thorough approach, he told insuranceNEWS.com.au today.

He says a forensic expert report will usually establish whether or not a driver was “actually under the influence” but in this case, it was just a conclusion.

“It's not immediately clear why the report in this case did not achieve that purpose,” the lawyer said. “There are some assumptions in the analysis so perhaps some of those were not properly founded in the evidence.”

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