Jenny and Alex were travelling overseas to their son’s wedding. When they arrived, they hailed a taxi, and the driver put their luggage in the boot. Jenny asked the driver to be particularly careful with one bag because it contained valuable items.
When they arrived at Jenny’s sister’s house, Alex unloaded the items out of the inside of the taxi, while Jenny held their grandson and watched the driver unload the luggage from the boot. Alex carried the luggage inside, paid the driver, and the family went to sleep.
The next morning, when they woke up, Jenny discovered the bag containing the valuable items, including the son’s wedding present, was missing. They reported the theft to the police, but could not remember the name of the taxi and could only describe it as being blue and white.
When they returned to New Zealand, Jenny submitted an insurance claim for $8,000, which included the wedding present, clothes and electronic items. The travel insurer declined the claim and Jenny referred the complaint to FSCL.
Dispute
The insurer said that Jenny and Alex had failed to take reasonable care of the bag. They had drawn attention to its value by telling the taxi driver to take care of it, then failed to check that it was unloaded from the taxi.
Jenny and Alex disagreed, saying that Jenny had been watching the driver the whole time, and had thought he had unloaded all the items.
Review
While the insurer agreed to cover Jenny and Alex for accidental loss, the policy obliged them to take reasonable precautions to protect property to prevent a claim from arising, the policy also excluded cover where bags are left unattended which is defined as being left where they can be taken without your knowledge or out of your line of sight where you are unable to prevent them being taken.
It is our view that something more than carelessness is required before an insurer can decline a claim.
However, in this case we decided that Jenny and Alex had not discharged their obligation to take reasonable care of the bag. They had told the taxi driver the bag contained very valuable items, which increased the likelihood of theft. Given that the bag was loaded last, it should have been unloaded first. We felt that, given the value of the bag, it would have been reasonable for Jenny and Alex to check that the bag was indeed unloaded and take reasonable precautions to keep the bag safe. We considered that Jenny and Alex’s actions were more than careless, and in fact were grossly careless, allowing the insurer to decline the claim.
Resolution
Jenny and Alex did not accept our view, but were unable to present any further argument or evidence to cause us to change our mind. Jenny and Alex discontinued their complaint through our process.
Insights for consumers
If you are carrying very valuable items while travelling, the level of care you will be expected to take to prevent loss is greater.
