Jaguar owner awarded increased payment after flood causes write-off

The owner of a 2014 Jaguar Roadster that was declared a write-off after flood damage will receive further reimbursement for the loss after partly winning a claims dispute.

The vehicle had been in the insurer’s care, undergoing repairs for a separate claim when it was flooded and deemed unrepairable.

Suncorp offered $140,000 and fewer policy deductions for the loss. The claimant, who held comprehensive motor insurance, was unhappy with the offer and sought cover for $180,000.

The Australian Financial Complaints Authority (AFCA) observed policy documents that stated the insurer would reimburse based on an agreed value for vehicles older than two years that are assessed as total losses.

The Certificate of Insurance (COI) specified an agreed value on the vehicle of $129,952, a decrease from the previous year’s cover of $140,000.

The man said he made applications to increase the vehicle’s agreed value, which the insurer rejected, saying it could not apply pricing adjustments while the car had been undergoing repairs.

Suncorp said its offer had been fair because it offered compensation higher than the agreed value listed on the COI. It said it “did not find it appropriate” to increase the amount covered for the vehicle when the complainant asked to because of the ongoing repairs.

The insurer acknowledged that its underwriting guidelines were directed more towards vehicles with pre-existing damage that a policyholder has no intention of repairing. It stated it did not find the complainant’s sought price reflective of the vehicle’s market value and the maximum cover it would have provided was $150,000.

The claimant argued the vehicle’s market value had increased due to the pandemic and a replacement would cost around $180,000.

The owner said he increased the vehicle’s agreed value in the previous year and wanted to do so again, which is why he contacted Suncorp. He alleged that the insurer agreed to increase the cover once repairs had been completed.

The man stated that part of the compensation should consider that the vehicle was damaged in the insurer’s care and that there was no action he could have taken to prevent the loss.

AFCA said there was “no dispute” that the vehicle owner attempted to increase the agreed value before the vehicle was declared a total loss and contacted the insurer on February 2 this year.

“The insurer appears to acknowledge it could have increased the amount covered at this time, because it says its underwriting guidelines are more directed at vehicles with long term pre-existing damage, not vehicles currently being repaired by the insurer,” AFCA said.

A senior underwriter from Suncorp responded to AFCA, saying it declined the request to increase because of the “substantial accident damage” the car had. The representative said it would be “unlikely” that the insurer would have agreed to cover the vehicle for $180,000.

AFCA determined Suncorp should settle the claim based on an agreed amount of $150,000, saying the increased sum was fair because the claimant had attempted to raise the cover before the flooding.

It said the insurer was entitled to charge the complainant the applicable premium for the agreed value from February 2.

Click here for the ruling.