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Insurer agreed to overturn decision to decline claim

Emma was on holiday in Spain when her backpack, which contained her laptop, camera and other valuables, was stolen from her rental car. Emma had left her bag in the locked car, while she visited a restaurant for dinner.

Emma knew the bag would be visible if she left it in the boot of the car, so she placed it in what she described to her insurer as “below the backseat of the car”, so that it would not be visible to anyone looking into the car.

When Emma returned to the car after dinner, she found the rear window on the driver’s side smashed and her bag missing. She immediately reported the theft to the local Police.


Insurance claim declined

Emma made a claim to her travel insurer under her cover for loss of luggage and personal effects. The estimated value of the items stolen, allowing for depreciation, was around $5,000.

The insurer declined the claim because the policy contained an exclusion which said they would not pay claims for luggage and personal effects left in an unattended car, in view of anyone looking into the car.

It was not possible to put a bag under the backseats of Emma’s model of car. The insurer took Emma to mean the bag was left in the footwell space between the driver’s seat and the backseat. This meant the bag would have been visible to someone looking into the car.

Emma disputed the insurer’s decision. She said her bag had not been visible. Emma gave the insurer photos of a car interior, with arrows pointing to the space where she had left her bag in the rental car. In two of the photos, the arrows pointed to the space under the driver’s seat. The third photo was ambiguous: it was not clear whether the arrow pointed under the driver’s seat or to the footwell between the driver’s seat and the backseat.

The insurer maintained their decision to decline the claim. Emma asked FSCL to review the insurer’s decision.



Emma said the insurer were wrong to decline her claim. She maintained that the bag had not been left in view of anyone looking into the car.

The insurer remained of the view that the bag had been left ‘in view’ and that her claim was excluded from cover.



We called Emma to discuss where she had left her bag. Without hesitation, she explained to us that she had left it under the driver’s seat.

We concluded that it was more likely than not that Emma had meant the space under the driver’s seat when she described to the insurer where the bag had been left. We were satisfied that Emma had not deliberately attempted to mislead the insurer. She thought she had given a clear explanation of where she had left the bag.

We found that the insurer’s decision to decline the claim was reasonable based on where they understood the bag had been left. However, we were of the view that the insurer should overturn their decision. The bag had probably been left under the driver’s seat, out of sight of anyone looking into the car. This meant that the ‘in view’ exclusion did not apply to Emma’s claim.



The insurer accepted our view and agreed to pay the claim. Emma had concerns about the depreciation and exchange rates the insurer had used to calculate their payment to her, but ultimately decided to accept their calculation so that she could put the matter behind her and move forward.


Insights for consumers and participants

When an insurer seeks to rely on an exclusion in the policy wording to decline a claim, the insurer carries the burden of proving that the exclusion applies. If an insurer cannot satisfy FSCL that they have discharged the burden to prove, on the balance of probabilities, that an exclusion applies, we may recommend that they should pay the insurance claim.