Leaving the Scene of an Accident Results in Denied Insurance Claim

The Incident

In May of last year, the driver of a Porsche 911 Carrera S Cabriolet crashed into a shed while returning home to pick up his wallet. The incident occurred late at night, and the driver reported that he had "lost concentration" while turning a poorly lit corner. After hitting a gutter, the car collided with the shed.

Investigation and Dispute

Following the crash, the insurer appointed an investigator who interviewed the driver and inspected the circumstances of the incident. The report identified that the driver crashed his car while returning home to pick up his wallet. Additionally, the driver reported feeling disoriented and having issues concentrating due to a lack of sleep from mental health issues and ongoing divorce proceedings.

The police also attended the scene and observed that both the driver and passenger doors of the car were wide open. They charged the driver with negligent driving and a failure to give particulars, which the insurer interpreted as a breach of their policy's conditions, specifically, a failure to "not leave the scene of an accident until lawfully allowed to do so."

The insurer argued that the driver's decision to leave the scene prejudiced their ability to assess the cause and circumstances of the accident, resulting in a denied claim. However, the driver and the insurer disputed this interpretation of events, with the driver stating that he thought he had hit a tree, not a shed. He did not realize that he had hit a building until the next morning when he returned to the scene, and he did contact the police and provide them with his particulars within 24 hours of the accident.

The Ruling

The Australian Financial Complaints Authority (AFCA) reviewed the case and determined that the insurer had not proven that the driver had unlawfully left the scene of the accident and that the available information did not support this conclusion. AFCA stated that there was "no legitimate basis" to reject the driver's statement that he thought he had hit a tree. The man had also made reasonable attempts to contact the shed owner and provided the police with his particulars within 24 hours of the accident.

As a result, AFCA concluded that the insurer should cover the driver's claim under the policy. However, they denied the driver's request for a hire car, stating that the policy only covered hire cars for "not at fault accidents." The insurer was also required to reimburse the driver for professional costs from his lawyer fees, up to a limit of $5000.

Conclusion

When involved in an accident, it is critical to adhere to your insurer's policy's conditions to ensure that your claim is not denied. However, in this case, the insurer did not have a legitimate basis to reject the driver's claim, as the available information did not support that he left the scene unlawfully. It is essential to carefully review your policy's terms and seek legal advice if necessary to ensure that you receive fair treatment in the event of an accident.

Click here for the AFCA's ruling on the case.