A policyholder whose Holden Commodore was stolen from a hospital car park will not be covered for the loss because she did not tell her insurer about modifications to the vehicle.  

The claimant accurately declared there were no modifications when buying a comprehensive motor policy from Auto & General in May 2021.  

But she made an exhaust change and completed a “dyno tune” – enhancing the car’s engine – a few months later.  

She subsequently renewed her policy three times, failing to disclose the changes.  

The insurer declined the theft claim last year when it learnt of the modifications. It said it would not have offered cover if it had known of the performance upgrades.  

In a dispute before the Australian Financial Complaints Authority, Auto & General said the modified car would have been considered an “uninsurable risk”.  

The claimant acknowledged she did not disclose the modifications, saying the omissions occurred during a “challenging period in her life”.

She told AFCA she was misled by an Auto & General representative who said during a phone conversation that her claim was approved, prompting her to put a deposit on a new vehicle.

But the authority says a recording of the call shows the insurer stated only that the claim was under review, and a receipt for the new vehicle was dated nine days before the conversation.  

AFCA says the policyholder’s failure to declare the modifications prejudiced Auto & General’s ability to assess the vehicle’s risk.  

“The outcome is fair because the insurer clearly asked about vehicle modifications in the renewal documentation. The complainant misrepresented this, breaching her duty.”

See the ruling here.

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