Bryan owned a yacht called Aparima. One day, when Aparima was moored at a marina, Bryan noticed damage to its arch, davits and dinghy. No one had seen what happened, but Bryan, who was an experienced mariner, concluded that another vessel must have collided with Aparima.
Fortunately, Aparima was fully insured. Bryan submitted a claim for $25,500. The insurer appointed an assessor to assess Bryan’s claim. The assessor raised the possibility that the damage had been caused by the dinghy filling with water (with the added weight causing the arch and davits to fail). The assessor also considered that part of Bryan’s claim was for potential loss (which the insurer would not pay for) instead of actual physical damage to Aparima.
Bryan was very unhappy with the assessor’s report. He devoted many hours to challenging the assessor’s findings (which Bryan called ‘corrupt’), and to taking the insurer to task on the many ways in which, in Bryan’s view, the insurer had let him down.
The insurer took a conciliatory approach. It did not wish to denounce the assessor’s report, but it continued to try to negotiate a settlement of Bryan’s claim. It engaged another assessor, who ended up agreeing that Bryan’s scenario was the most plausible. It even paid Bryan for the time he had spent on his own claim. In total, the insurer paid Bryan nearly $43,000 in settlement of his claim.
Bryan complained to FSCL. He was still unhappy that the assessor had suggested another cause of damage. He felt that the insurer had not acted in a legal, honourable or proper manner. He listed a number of pieces of legislation that he considered the insurer had breached. He wanted the insurer to pay him $150,000 in punitive damages – damages purely to punish the insurer rather than compensate Bryan for any loss.
The insurer’s view
The insurer considered that it had responded to Bryan’s claim fairly and that it had reasonably complied with all its obligations.
We reviewed the insurer’s conduct. We considered that the insurer had not breached any of the legislation raised by Bryan, and that it had acted in a manner consistent with its obligations.
We noted that ultimately it did not matter how Aparima was damaged because Bryan’s policy provided cover either way.
We noted that this was a difficult and complex marine insurance claim, and we considered that the insurer had provided Bryan with a high standard of customer service. We noted it is highly unusual for an insurer to compensate an insured for their time in attending to their own claim; we considered this a show of good faith by the insurer.
We did not uphold Bryan’s complaint. We considered that the insurer had reasonably investigated and settled Bryan’s claim in accordance with the policy and usual industry practice. We discontinued our investigation.
This is a case where the insured, who was an expert in the field, was unwilling to tolerate any testing of his own views. However, an insurer does not have to just accept the insured’s position without query and abandon its own investigation. The insurer is entitled to assess the accuracy and validity of an insured’s claim.