Party crasher: claim denied after police chase over drugs

15 February 2023

A complainant who sought compensation for his damaged vehicle after an acquaintance crashed it during a police pursuit has lost his claims dispute.

The policyholder lodged the claim for accidental damage to his 2013 Mazda 3 Hatchback, which was deemed a total loss.

The claimant had attended a party on March 18 2021, where he handed the keys to the insured vehicle to an acquaintance, referred to as AA. While driving, AA was signalled by police to pull over on the suspicion that drugs were being sold.

AA refused to pull over, causing the police to pursue them for about 10 minutes before the driver mounted a kerb and crashed into a stationary third-party vehicle, which was also deemed a total loss. The police apprehended AA after they attempted to flee the scene and later charged them with several offences.

Allianz did not dispute the matters of the crash but said the loss arose from “deliberate and criminal acts of the driver in charge of the IV,” and was excluded under the comprehensive motor vehicle policy.

The Australian Financial Complaints Authority (AFCA) agreed that the exclusion applied despite the policyholder not being the driver, because he gave consent to AA to drive the vehicle.

It said that the insurer correctly assessed the events leading up to the accident and that it was within its rights to decline the claim.

“I am satisfied it is fair in the circumstances to accept the loss or damage to both vehicles are due to deliberate and criminal actions, which is excluded under the policy. AA was in charge of the IV with the complainant’s consent at time of the accident,” AFCA said.

“As such, I accept the insurer is entitled to rely on the policy exclusion to decline the complainant’s claim.”

Click here for the ruling.