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OSTI Report: Lies, lies, darn lies… will compromise your claim

08 June 2017 OSTI

The following case study has been extracted from OSTI Annual Report for 2016.

Mutual & Federal Insurance

The dispute relates to a motor vehicle hijacking claim for an incident reported to have occurred on the 26th of June 2016.

The insurer rejected the insured’s claim on the basis that the insured provided it with dishonest information with regards to the claim. The insurer also asserted that the insured had failed at the inception of the policy to disclose material information regarding his insurance history.

The insured advised the insurer that he had gone to visit a colleague who stays at Litha Park, which is situated five minutes away from his house. Whist driving home from the colleague’s house, he gave an old man a lift to Harare. After dropping off the old man and before he could start the vehicle, he was approached by two men who beat him up and drove off with the vehicle. He walked to his cousin’s home who stays close to where the vehicle was hi-jacked. According to the insured, the perpetrators had strangled him until he passed out. He later found himself dazed, walking in the rain not knowing how he got to his cousin’s house.

On arriving at his cousin, the insured alleged that he went to sleep.

He did not contact the police or his wife. He further advised that his cell phone had been taken during the incident. The following day, his cousin assisted him to go to the police station and report the incident.

The insurer’s assessor confirmed during the investigation that the insured did in fact visit his colleague in Litha Park. However, in contrast to what he had reported to the insurer, the insured told the assessor that he had given a lift to two old men. The insured thus provided the assessor with a version different from the one given to the insurer when the claim was submitted.

The insured vehicle was later found by the SAPS having been burnt down. The vehicle was found also to have sustained accident damage. It was also discovered that the insured had submitted an almost identical claim in 2014 which had been settled by the insurer.

The insurer argued that the insured had failed to inform it at the inception of the policy that he had two previous policies that had been cancelled by his previous insurers, Iwyze and Telesure.

The insurer further argued that, in its view, the insured had staged the hijacking. The insured apparently informed the insurer’s assessor that he was on a call when the hijacking occurred and had a made a few calls prior to the hijacking.

The insured’s service provider confirmed that there were no calls made or received for at least six hours prior to the incident.

Having carefully considered all the submissions made, the Ombudsman was of the view that the insured had misrepresented his insurance history at the inception of the policy. It further appeared that the insured’s loss had probably been staged, considering the conflicting versions provided by him and the various discrepancies in the factual circum-stances surrounding the alleged incident.

The insurer’s decision to decline the claim was accordingly upheld.

Peter Nkhuna
Senior Ombudsman

 

 

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