Mazda driver who forgot to update phone, email loses dispute

A motorist who missed two policy premium payment instalments when he changed his job, email address and phone number has lost a claim dispute.

In September, the 2014 Mazda CX-5 driver was involved in a car accident and attempted to lodge a claim the next day but found his policy had been cancelled around 10 weeks earlier.

The Auto & General customer told the Australian Financial Complaints Authority (AFCA) he forgot to update the insurer about changes to his contact details due to the stress of the covid pandemic, and did not receive any correspondence about the missed instalments even though his home address was correct. He had never before missed a payment in years of insuring his vehicle since 2017.

AFCA ruled he did not have a policy in force at the time of the loss as it was cancelled due to his own failure to make the required instalment payments.

“The complainant likely never read the cancellation letter or other correspondence sent by email. This does not mean the insurer failed to fulfil its obligations,” the ombudsman said.

“I accept the complainant’s failure to inform the insurer of these changes was an oversight and he intended to pay the instalments and had an issue with his credit/debit card which meant the policy deductions did not occur.

“The complainant is required to ensure his policy is paid and up to date. He did not do this and the insurer cancelled the policy. This was done in accordance with its legal requirements.”

His policy was renewed in March last year and he missed two monthly payments, which the insurer unsuccessfully attempted to deduct on May 28. It emailed a letter to the customer in June informing him of the missed payments, and a reminder email was sent on June 12. The insurer also sent SMS text messages on June 1 and 9, and in July.

These communications were not received as the Mazda driver had not informed the insurer he had changed his mobile number and email address. After receiving no payments or response, Auto & General cancelled the policy on July 5.

“It was reasonable for the insurer to use that email address. This was the email address on record and detailed on the policy documents. The use of this email to provide information to the complainant was therefore proper,” the ombudsman said.

The man offered to pay the premiums back but AFCA said Auto & General was not required to accept that offer.

“It attempted to contact him but was unsuccessful,” AFCA said. “It is entitled to deny the claim as the instalments were more than 14 days overdue at the time of the loss.

“This was due to the complainant not informing the insurer of his changed email address and changed phone number.

“It is the complainant’s onus to ensure his policy is paid and up to date,” the ombudsman said.

See the full ruling here.