Too little, too late
On 14 November 2016, Mrs H lodged a claim with her insurer for lighting damage to her household items. The insurer rejected the claim on the basis that the damage was not caused by an insured peril and that the loss did not fall within the benefits provided by the policy.
Mrs H was not happy with the insurer’s decision and escalated the matter internally with the insurer. The insurer stood by its rejection of the claim and advised that the matter was closed. Mrs H applied to OSTI for assistance. This was more than two years after the outcome of the internal dispute with the insurer.
OSTI sent Mrs H’s complaint to the insurer. In response to the complaint, the insurer argued that Mrs H’s complaint was time-barred and should not be entertained because Mrs H did not approach OSTI within the time frame prescribed by the policy.
The insurer referred to the policy terms and conditions which set out the timeframe within which to dispute the outcome of the claim.
OSTI’s jurisdiction is limited concerning time-barred complaints. When Mrs H approached OSTI, the time frame within which Mrs H had to challenge the insurer’s decision had expired, and the complaint was time-barred. OSTI requested Mrs H to provide reasons for the late submission of the complaint. Mrs H failed to respond to OSTI, and as a result, OSTI could not condone the late filing of Mrs H’s complaint. The complaint fell outside of OSTI’s jurisdiction and could not be considered.
New car and photographs
On 23 April 2019, Mr J was involved in a motor vehicle accident. To cover the costs of the damage, he submitted a claim to his insurer.
The claim was rejected on the basis that the policy was not in force at the time the accident took place. Mr J’s policy began in June 2017. Around 28 February 2019, Mr J purchased a new vehicle. In February 2019, the insurer did not receive a premium and the policy subsequently lapsed.
To reinstate the policy, the insurer required Mr J to pay his premium and submit eight photographs of his new vehicle. Until the insurer received and accepted the photographs, the policy was not in force and Mr J’s new vehicle was not covered.
Mr J said the insurer continued to deduct premiums, even after the non-payment of the February 2019 premium. Therefore, he argued, the vehicle was covered in terms of the policy.
The insurer argued that the requirements for the policy to be reinstated were the payment of the premium and the submission of the photographs.
In a call, which took place on 8 March 2020, Mr J was requested to provide photographs of his new vehicle. On 28 February, 28 March, and 29 April 2019 the insurer sent Mr J several SMS notifications which stated that for the cover to be activated it required the photographs, as well as the premium. The insurer argued that it was never provided with any photographs to confirm the condition of the vehicle before the accident.
OSTI found that Mr J was informed of the fact that the February premium was not paid and that he was adequately advised of the requirements to reinstate the policy. As the conditions for cover were not met, the insurer’s rejection of the claim was upheld.
Mr K’s confession
On 30 December 2017, Mr K returned to his residence after a brief trip, to find that he had been burgled. On 2 January 2018, he registered a claim with his insurer. According to Mr K, the items stolen were a plasma television and two laptops. Mr K said he reported the incident to the Katlehong Police Station.
After completing his investigation, the assessor reported discrepancies in the information provided by Mr K. During the initial assessment conversations, Mr K said that he had not suffered any previous losses involving burglary, theft or the loss of similar items. The assessor discovered that Mr K had reported two burglary cases at the Katlehong Police Station: the current burglary and a previous burglary that had occurred in May 2017. Similar items were reported stolen to the police during May 2017 namely, a plasma television and a laptop. The policy with the insurer was not in place in May 2017 and only commenced on 6 July 2017.
On 19 January 2018, the assessor confronted Mr K with his findings. The conversation took place telephonically and was recorded by the assessor.
Mr K admitted that he suffered a burglary in May 2017. He stated that the television and laptop were stolen but both items were recovered after the incident. The assessor asked Mr K whether any of the items should not form part of this claim because they were not stolen in the December 2017 incident. Mr K responded that one of the laptops should not be part of this claim.
The assessor asked Mr K whether the incident in December 2017 actually occurred. Mr K admitted that the incident did not take place. Mr K stated that one of the laptops was damaged and discarded before the alleged incident, the second laptop was still in his possession and the television that he claimed for never existed. The assessor gave Mr K the option to make a written statement confirming his admissions. He agreed to do so.
The insurer rejected the claim on the grounds that it was fraudulent and cancelled Mr K’s policy. The insurer submitted that Mr K committed insurance fraud and perjury by reporting a false claim and a criminal case to the police. The insurer submitted that the listing of Mr K’s details on the South African Fraud Prevention Service (SAFPS) database was correctly executed and would not be removed.
Based on Mr K’s confession that the incident in December 2017 had not occurred and that the items claimed for were not stolen, OSTI upheld the insurer’s decision.
Challenging the decision
Seeking to overturn the rejection of the claim, cancellation of his policy and the reporting of the claim to the SAFPS, Mr K requested a review, stating that he cancelled the claim before the conversation with the assessor, he was harassed by the assessor to agree to the assessor’s ‘untrue’ version of events, and that the letter given to the forensic department as his admission of committing insurance fraud was not authentic.
OSTI referred to a copy of the recorded assessment conversation. This undercut Mr K’s grounds for review because it proved that his first two statements were false, and that he submitted a fraudulent claim. When Mr K approached OSTI for assistance on 9 July 2019, he did so on the basis that the reported burglary had, in fact, occurred and that he had a valid claim for the loss.
OSTI found that the insurer was justified in its decision to reject the claim, cancel the policy and to report the claim to the SAFPS.
Mr K requested leave to appeal OSTI’s findings. OSTI found that Mr K’s application was ill-founded and there was no prospect of a successful appeal against the ruling.