‘Threatened’ unit owner challenges insurer’s reticence on recovery
A strata complex resident has lost a dispute with her motor insurer after she alleged a property company tried to force her out by damaging her car.
IAG accepted the woman’s claim after a corrosive substance was thrown over her vehicle. It carried out repairs and waived the excess.
But the resident was left fuming by the insurer’s decision not to pursue the owners’ corporation for recovery of the costs, and she took her case to the Australian Financial Complaints Authority.
“The complainant says by refusing to pursue recovery, the insurer is silently distributing the costs of crime to customers via increased premiums and excesses,” AFCA says.
The resident said a property company bought half the units in her complex and operated a short-term accommodation business there.
She said company employees interfered with her unit, her privacy and parked cars to force her out so the business could acquire her home. She provided the insurer with an audio recording of a threat.
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She said a “corrosive substance which smelled like turpentine” was thrown on her car while it was in the complex’s secure car park, and she believed “people involved with the property company” were responsible.
The complainant cited legislation that said owners’ corporations control use of common property.
“As such, she wants the insurer to pursue the owners’ corporation for the cost of repairing the damage to her car,” AFCA says.
However, the insurer said the woman did not suffer a loss because it waived the $850 excess as the claim was the result of “malicious damage”.
It did not pursue recovery because “the policy requirements to hold another party at fault were not met”. The complainant did not provide the name or address of any other party, and police did not identify any suspects.
AFCA’s ombudsman agrees with the insurer.
“I accept the insurer’s position that it did not have enough information to hold the owners’ corporation (or other person) liable,” the ruling says. “I am not persuaded the insurer is obliged to expend its resources on a recovery attempt that appears to have minimal likelihood of success.
“The insurer is entitled to decide whether it expends resources pursuing recovery from another party, regardless of whether that party is deemed to be at fault.”
See the full ruling here.