Motor - Delay in Notification of Claim
The insured’s motorcycle was stolen and the insured submitted a ‘theft claim’ to the insurer. The insurer rejected the claim on the grounds that the theft was notified to them more than four months after the date of the loss. Thus, the insured had breached policy condition 2(a) which reads as follows:-
“CONDITIONS – THESE APPLY TO THE WHOLE POLICY
2. ACCIDENTS AND CLAIMS PROCEDURES
(a) We must be notified in writing or by phone in either case with particulars of the vehicle involved, date of accident and, if possible, a brief description of the circumstances of the accident within the specific time frame as follows after an event which may become the subject of a claim under this Policy:
(i) Within seven (7) days if You are not physically disabled or hospitalised following the event;
(ii) Within thirty (30) days or as soon as practicable if You are physically disabled or hospitalised as a result of the event;
(iii) Other than (i) and (ii), a longer notification period may be allowed subject to specific proof by You.”
Investigation and Findings
The Case Manager observed from the documentary evidence submitted by the insurer that the theft occurred on 26/11/2015 but claim form was only issued on 13/04/2016 which was more than four months after the date of loss.
The Insured contended that the reason for the delay in notification of the claim was because he was not aware of the claims procedures and also he did not have the time to notify the insurer as he works abroad (Singapore). As such, he had sought his friend’s assistance to notify the insurer of the loss.
However, his friend had failed to notify the insurer as he too did not know the claims procedures and assumed that the police will notify the loss to the insurer.
It was not disputed that there was a delay in notification of the claim by the Insured to the Insurer as evident from the insurer’s investigation report, in particular, the insured’s statement to the insurer’s investigator.
The Case Manager found that the Insured’s reason for late notification was unacceptable since it is the Insured’s duty as the policyholder to read, understand and comply with the terms and conditions of the policy. Further, the Insured could have sought the assistance of the Insurer’s branch office or agent if he was not aware/had no knowledge of the claims procedures. The delay in notification has prejudiced the Insurer’s position to investigate into the circumstances of the theft of the vehicle.
In addition to the policy provision 2(a), the Case Manager also drew the insured’s attention to Section 104 of the Road Transport Act 1987 (RTA) which imposes the duty of the insured to notify the insurer as soon as possible of the occurrence of any event which may give rise to a claim under the policy. Section 104 of the RTA provides that “it shall be the duty of the insured to notify the insurer as soon as possible of the occurrence of any event which may give rise to a claim under a policy”.
The Case Manager recommended that the Insurer’s decision be upheld.