A policyholder who said his car was stolen when he lent it to a friend will not be covered for his loss after the financial services ombudsman backed his insurer’s claim rejection.

The man told Suncorp he let the friend take his 2014 Toyota Camry for a test drive in February 2024 amid “very early talks” on a planned sale, but the car was not returned.  

He said he contacted the friend later that month, and the person said they were in Kenya before disconnecting the call. The friend thereafter refused to contact the claimant.  

The owner said he reported the car stolen but police refused to consider it a theft because he had a history of lending the vehicle to the friend. He said officers told him the loss was a “civil matter”. 

Suncorp declined the claim because police did not consider the matter a theft, meaning there was no insured event.  

It added its policy had exclusions for “intentional or deliberate” acts by a person “authorised by you to operate your car” or “acting with your encouragement, assistance or express or implied consent”.  

The claimant said Suncorp’s decision was unfair because he lent the car – which was insured for an agreed value of $21,000 – on the understanding it would be returned the next day.  

He showed the Australian Financial Complaints Authority screenshots of text messages sent on March 29 asking the recipient to “please return my car right now”.

The insurer referred to an updated police report explaining the claimant lent the vehicle “as part of a commercial relationship”, and the car was “loaned out for the purposes of conducting a rental car business”. The report noted the car was returned to the claimant.

Suncorp said police found “no evidence of the intention being to permanently deprive the complainant of the vehicle”.

In its determination, an AFCA ombudsman accepts “a third party has wrongfully taken the car and not returned it to the complainant since on or about March 29 2024”, and the owner “has suffered a loss due to theft”.

They add: “While the police report recorded that it was not a theft (but a commercial dealing) and the insurer said there was no evidence of the third party’s intention being to permanently deprive the complainant of the vehicle, the car has not been returned to the complainant.”

However, the authority backs the “intentional or deliberate act” exclusion, because the friend obtained the car with the complainant’s consent.  

See the ruling here.