Insurance Ombudsman warns of 'reasonable car' duty after spate of car thefts
People who don't lock their cars or leave valuables in sight on seats, could leave themselves uninsured, Insurance Ombudsman Karen Stevens says.
If a thief strikes, insurers are likely to decide people who have not locked up and cleared the seats of valuables have not taken "reasonable care" of their property.
Insurance was a deal between the insurer and insured, and part of that was the policyholder being careful with their possessions.
But Stevens said 24 thefts from cars in Wellington last weekend showed many people were not taking that duty of care seriously.
"Leaving your car unlocked and your valuables visible is a double risk." she said.
"You could have your items stolen and find you have no insurance cover.
"We receive many complaints when insurance claims are declined, because insurers do not believe people took reasonable care for the safety and security of their property. Unfortunately, many people think they're automatically covered if they have paid for insurance - not necessarily so, unless you comply with your policy obligations."
But things did not always favour the insurer. Cases that came before the Ombudsman, which is changing its name to the Insurance & Financial Services Ombudsman on November 1, showed insurers sometimes declined claims for reasons a court would not uphold.
"Proof of mere negligence or carelessness is not sufficient," Stevens said.
"The insurer must prove the conduct of the insured was reckless, grossly careless, or grossly negligent."
Locking the car
Leaving your car unlocked with valuables inside isn't taking reasonable care, nor is leaving the keys in the lock, but circumstances matter.
In one case, a rural delivery diver in a small town left the keys in his unlocked vehicle after rupturing a hernia at 4am and went for a lie down. In the circumstances, he had not been careless, Stevens said.
In another case, a man popped into a pub to wait for his wife. He left his car unlocked and the keys in the ignition. He argued it was a quiet afternoon, the vehicle was visible from the tavern, and there were security cameras. The ombudsman found he had not taken reasonable care.
In another case, leaving a car unlocked behind a house, at the end of a long driveway, with the keys in the ignition, did not meet the duty of care an insurer should expect.
Leaving valuables in a car
Leaving items in sight would breach the duty of care. The value of an item and the risk of the location the car is left in, can have a bearing.
Leaving valuables in the boot of a car in an isolated car park where there were signs warning of break-ins to vehicles was unlikely to impress insurers, but Stevens said leaving valuables in the boot of a locked car would not ordinarily breach the duty of care.
Locking the house
Popping out and leaving the house unlocked, or windows open is inviting burglary, but again circumstances matter.
In one case a ranchslider was left open, but it led into a locked and gated courtyard, so leaving the door unlocked couldn't be seen as not taking reasonable care. Stevens said. Leaving a front door unlocked in a busy city while gardening out the back might be considered differently from a farmer doing the same.
Leaving valuables lying around your house
Leaving valuables in sight of windows when going out can be a red rag to burglars, but leaving valuables in a locked house is a normal part of life. It can be different at open homes.
In one case a woman selling her home had items taken during an "open home". The valuables were items of jewellery in a pouch in an unadorned box on a shelf in a walk-in wardrobe. She had not thought to move it, but would have if it had occurred to her. That was negligent, but not grossly negligent, the ombudsman found.
Caring for your luggage
Taking care of your luggage while travelling can be hard.
Travel insurance policies will tell you some of what you need to do (for example keeping jewellery on your person), and will warn you not to leave items "unattended". Leaving a bag unattended in a public place, except by accident, is not taking reasonable care, though what constitutes a public place is sometimes debated. Travelling by bus, train and taxi require vigilance.
Leaving stuff at the beach
Leaving your valuables on the beach, or poolside while you have a swim is not taking reasonable care.
Maintenance of vehicles
Taking reasonable care means keeping your vehicle safe. Using a car with bald tyres, even if it has a current warrant of fitness, is not taking reasonable care.
Taking care of homes
Failures to look after homes can include allowing dangerous, or illegal activities to take place in them.
In one case a woman allowed a house to be used as a cannabis farm, but the lights and heaters encouraging the cannabis to grow caused a fire. The insurer declined the claim saying the owner had not taken reasonable care.
In another case storm damage to a roof was only partially covered when the insurer found the roof was in a poor state, and the homeowner had been told it was in need of repair.
Who you let drive
In one case a company failed to properly check the references, driving history, or properly train a driver. The insurer found that was not taking care of the vehicle, which the driver crashed.
Insurers may decide you caused a crash by driving without care, but they may not be legally allowed to do so.
In one case before the ombudsman, a young man was involved in a collision after travelling at speed through residential streets. He pleaded guilty to dangerous driving for things he did in the leadup to the collision, but the insurer could not prove the young man's actions had caused the crash, only contributed to it. The insurer had to pay.
State of mind can be important. In one case a woman appeared to have tried to kill herself by deliberately crashing into another vehicle, but the ombudsman found she was in a "disassociated" state and could not be considered to be behaving in a reckless, grossly negligent or grossly careless manner.