AFCA Upholds Insurance Fraud Ruling Over Disputed Possum Accident

1

The insurer, RACQ Insurance, questioned the claim based on several factors. Their forensic specialist reported that the vehicle accelerated on a gravel shoulder before colliding at 43km/h, which they deemed consistent with intentional behavior. Further scrutiny revealed no rainfall according to meteorological data, contradicting the claimant’s account.

Bank records submitted by the driver appeared tampered with, and the insurer argued that the Jeep was intentionally overinsured. This assertion was backed by a seller's email stating a lower sale price of between $8,000 to $9,000, far from the insured value.

Despite the driver's insistence on the legitimacy of his claim, AFCA was not convinced. An ombudsman noted the lack of counter-evidence and the magnitude of inconsistencies supporting the insurer's fraud claims. Consequently, AFCA sided with RACQ, declaring the fraud allegations justified.

This ruling underscores the importance of transparency and accuracy in insurance claims. For consumers, the decision serves as a reminder that claims are subjected to rigorous verification processes. Accurate documentation is crucial, and discrepancies may result in a denial.

For the insurance sector, this case highlights the pivotal role of forensic analysis and corroborative data in fraud detection. It emphasizes the ongoing challenge insurers face in balancing thorough claim assessments with fair customer treatment.

The AFCA's decision may prompt insurance companies to further refine analytic techniques and fraud detection measures. This could mean businesses will increasingly use technology to ascertain claim validity, ensuring policyholders' premiums reflect genuine risks without inflating costs due to fraudulent activities.

Consumers should ensure all insurance dealings are clear and well-documented, particularly when insuring assets. Emphasis on maintaining transparent financial records will help avert disputes and support the validity of legitimate claims.

Published:Thursday, 26th Jun 2025
Source: Paige Estritori

Share this news item:

Insurance News

Clear

ClearView Names New Underwriting Head Amidst Strategic Changes 30 Jun 2025: Paige Estritori ASX-listed life insurer ClearView has announced the appointment of Peter Tilocca as Head of Underwriting, coinciding with key updates to its underwriting standards and definitions. Tilocca's extensive two-decade career in Australian underwriting includes leadership roles at Zurich, Noble Oak, One Path Life, and RGA Australia. His new role with ClearView commenced on 30 June. - read more

Ombudsman Supports Theft Claimant in Home Business Coverage Dispute 30 Jun 2025: Paige Estritori A recent case has seen a policyholder triumph over her insurer after the Australian Financial Complaints Authority (AFCA) ruled in her favour following a contentious dispute regarding home business operations. The controversy arose when the woman's theft claim was denied by her insurance provider, IAG, over allegations of fraudulent misrepresentation about the use of her rental property. - read more

AFCA Upholds Insurance Fraud Ruling Over Disputed Possum Accident 26 Jun 2025: Paige Estritori A motorist's claim that he crashed into a tree to avoid a possum has been denied by the Australian Financial Complaints Authority (AFCA), which supported the insurer's fraud decision. The incident involved the driver crashing his Jeep—insured for over $20,000—on a dimly-lit street, purportedly avoiding the rain-soaked motorway en route to the store. - read more

Code Watchdog Criticises Insurer for Misleading Rejection Letters 24 Jun 2025: Paige Estritori The Life Code Compliance Committee has recently reprimanded a life insurance provider for issuing misleading rejection letters to policy applicants. These letters were deemed 'ambiguous and contradictory' and failed to clearly inform applicants of their review options after being denied coverage. - read more

Insurer Ordered to Pay Full Claim for Confusing Patio Coverage 23 Jun 2025: Paige Estritori A recent ruling mandates that an insurer must fully honor a storm-related claim due to ambiguous policy wording regarding items in open areas. The Australian Financial Complaints Authority (AFCA) determined that the insurer's restriction on coverage for items in a patio area was unfounded, as the policy's phrasing was not clear. - read more