A UK-based insurance intermediary has been ordered to pay more than R300,000 to a doctor after his short-term insurance company rejected his claim following the theft of his Toyota Land Cruiser.
Her claim was rejected because the vehicle did not have a satellite early warning device, as required by policy.
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Ombud for Financial Service Providers (FAIS) solicitor John Simpson awarded Buddy Jacobs Insurance Brokers CC R301 466.00 to Dr Luzanne de Beer in relation to a previously rejected insurance claim. and ordered to pay interest.
Ms. DeVere purchased a Toyota Land Cruiser 76 4.2D on February 5, 2016 and added the vehicle to her insurance policy through her broker, Buddy Jacobs Insurance Brokers.
The vehicle was stolen from her place of employment on July 20, 2018, and she lodged a claim for R312,400 with insurance company Quicksure, underwritten by Old Mutual Insure.
Quicksure denied the claim on August 17, 2018.
De Beer filed a complaint against Quicksure with the Short Term Insurance Ombudsman (Osti), but the complaint was dismissed.
She then filed a complaint with the Fais office against Badie Jacobs Insurance Brokers on October 29, 2018, and the insurance broker's representative, Jacques Jacobs, advised her that the requirements of the insurance policy, including the need for this device, were not properly explained to her. He claimed that he had not notified him. will be installed.
De Beer further claimed that there was no communication from the insurance broker inquiring whether a satellite early warning system was installed, and no certificate of installation was requested.
Broker responds
Buddy Jacobs Insurance Brokers said Mr. De Beer signed the insurance policy documents after being told that he needed to install satellite early warning equipment and did not pay due attention to the policies and associated disclosures.
The policy stipulates requirements regarding satellite equipment, which it says are the basis for denying claims.
It also claimed that the satellite equipment had been explained to De Beer, a claim corroborated by communications from one of its employees, Susanne Calitz.
Defense lawyer Mr. Simpson argued that the insurance broker denied liability from the beginning and that Mr. De Beer knew or should have known about the satellite early warning device.
He sent a letter of recommendation to the intermediary on August 24, 2023 recommending that the claim be resolved, but the intermediary intends to appeal the decision on September 7, 2023, He said he responded by saying he was seeking legal advice.
Simpson said subsequent attempts to contact the brokerage firm or its compliance officer by phone and email were unsuccessful.
Tracking devices 'not a normal requirement'
Mr Simpson assessed the evidence and said, based on his experience with cases adjudicated by the Office of the Ombud, early warning satellite tracking devices were not a normal or usual requirement in all vehicle theft coverage policies.
Generally, it only applies to certain vehicles depending on value and exceptional risk factors, he said.
Mr Simpson claimed that the insurance broker had discussed this requirement with De Beer, but said it had not provided any evidence in this regard.
He said there was no record of any advice reflecting discussions with De Beer about the satellite tracking device, and no evidence that he followed up with De Beer to confirm whether the device was installed.
Mr Simpson said the only evidence they submitted was a general letter sent to all customers and an insurance schedule sent to DeVere at the time of policy initiation.
He added that Calitz's public statement had little evidentiary weight and would not advance the insurance broker's case.
“There's no evidence.”
He said there was also no evidence that De Beer received adequate advice or information or that the brokerage firm complied with its responsibilities under the General Code of Conduct for Licensed Financial Services Providers.
Counsel Simpson argued that, on the balance of probabilities, he could only conclude that the insurance broker did not provide De Beer with any additional specifics or information regarding the early warning satellite tracking device beyond what was provided in the policy sheet. He said no.
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He said the Code imposes an obligation on financial service providers to disclose the material terms of their contracts, putting them in a position to make informed decisions and take appropriate action if necessary. He emphasized that
condemnation
Advocate Simpson said the brokerage was trying to blame De Beer for not reading the policy.
“However, no evidence of compliance with the norms has been provided.
“There is no evidence that the services were provided with appropriate skill, care or diligence,” he said.
The brokerage appears to view itself as a “mere conduit or mailbox” for De Beer's dealings with insurance companies.
“According to the Code, its duties and responsibilities go far beyond that.”
Mr Simpson said the insurance intermediary was an expert in the field and had all the information and assistance it needed to ensure that DeVere was provided with sufficient advice and information regarding special situations such as early warning satellite tracking equipment. It is expected that it will be provided.
“In that case, you would be reasonably expected to follow up regularly to confirm whether the device has been installed and to send proof of installation to your insurance company.
“Send a general letter to all customers and send a policy schedule to claimants.” [De Beer] It doesn’t meet the requirements from a code perspective,” he said.
Mr Simpson said the brokerage firm's failure to comply with the provisions led to a situation where De Beer was not reasonably aware of the requirements and did not take the necessary steps to comply.
Another Ombud ruling
In a separate decision, Simpson Solicitors ordered that Uncle Mike's 24 Funeral Home Ltd. (Pty), trading as Natex Funeral Services in the Kimberley, charge Leigh-Anne Robinson with providing services under a funeral contract with the company. He was ordered to pay R40,000 in compensation.
Her April 2020 claim related to the death of one of the policy's insureds, Ms Robinson's cousin Teshwill Eksteen.
Winston Williams of Nattex Funeral Services denied the claim on the basis that Eckstein died within the six-month waiting period.
However, it turns out that the policy was seven months old by the time the claim was filed.
Ms Robinson asked Natex Funeral Home to honor the request and pay R40,000.
Nattex Funeral Services agreed to pay the R40,000 bill in installments from August 2020. However, no proof of payment was provided and a lengthy period was granted to resolve the claim.
Ms Simpson said attempts to contact Natex Funeral Services were unsuccessful.
After evaluating the evidence and supporting the complaint, Mr. Simpson concluded that Nattex Funeral Services violated Section 2 of the Fais Act, which states: and for the benefit of our customers and the integrity of the financial services industry. ”
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