Insurance claim hits a snag over privacy concerns

In a recent ruling, the Australian Financial Complaints Authority (AFCA) has sided with an insurance company in denying a lost property claim, basing its ruling on the claimant's refusal to submit phone records to the insurer.

The controversy began when a man, acting on behalf of his mother with dementia, filed a claim for her lost jewellery on 14 September. However, when the insurer asked for the mother’s phone records as part of their standard investigation, the son refused, arguing it was an invasion of his mother's privacy.

Insurance claims and the Privacy Act

The AFCA's ruling confirmed that the insurer's request for phone logs did not breach the Privacy Act 1988 and was a reasonable step in the claims process. As a result, without the requested phone records, the claim could not proceed.

The insurer, Suncorp, had made it clear that the phone records were essential in confirming the details of the loss. The son's refusal has been a significant factor in their decision to deny the claim.

The man still has an opportunity to have the claim reopened as long as he provides the appropriate phone records.

What this means for you

With the AFCA's recent ruling in mind, it’s a gentle reminder that being upfront with information is sometimes part of the deal.

Here’s what you need to grasp:

• Being open. There are moments when sharing personal data is necessary to move forward with a claim. It’s about maintaining the integrity of the process and fulfilling your part of the policy agreement.

• Privacy intact. Your privacy isn't going anywhere; it’s well-protected by law. Rest assured, if your insurer is asking for information, they're doing so with the boundaries of the Privacy Act in mind.

The lesson here is as practical as it is simple: know what your insurance policy expects of you, and don’t shy away from those requirements when the time comes. 

If you need a refresher, have another read through your Product Disclosure Statement (PDS); it's the best way to ensure that you’re meeting your policy requirements.