Client rues lack of car-fire coverage

Shaun Blondell, over his car's burnt-out engine bay in Dunedin this week, is frustrated his...
Shaun Blondell, over his car's burnt-out engine bay in Dunedin this week, is frustrated his insurance company will not pay for an electrical fault it deemed excluded from policy cover. Photo by Stephen Jaquiery.
When Shaun Blondell looked outside his bedroom window to see a fireball explode from his car, he never thought it would result in the hardest insurance lesson of his life.

It was 3am on February 24 and worn wiring had caused an electrical fault, most likely a short-circuit.

The electrical fault was later confirmed by an origin-of-fire investigator as having set off a fire in his car's engine bay.

While upset about the fate of his car, he knew he had comprehensive insurance cover and had no concerns about claiming under his cover.

However, for the past two weeks he has been battling with his insurance company, Vero, over an exclusion in his policy - it does not cover electrical faults.

Mr Blondell took out his insurance policy through his bank, ANZ, but says he never received a full copy of it.

He had not been concerned about neither receiving nor reading it.

"I've been driving for 23 years and I've never had a claim," Mr Blondell said.

"Electrics make up 50% of a car. To exclude them is like saying, 'You've got a stove in your house which burnt the house down, but we are not going to cover you because it's a stove'."

He believed the fire the electrical fault caused should have been covered.

"The fine print will get you in the end," he observed.

People needed to be aware of what was in their existing policies and thoroughly read new policies before signing them.

"I don't want other people to be in that situation. I'm learning the hard way."

The claim was "going through an internal review process", a Vero spokeswoman said.

"As part of this process, we're also taking a closer look at the investigative and electrical reports before we get back to him with a decision."

She added, "as a rule", policies were issued in CD format, with a paper schedule.

"The CD would have been issued once - at inception of the policy. An endorsement is provided if cover is switched between two vehicles. We are always available to our customers if they haven't received the necessary documentation or would like us to send a copy of the endorsement letter."

Insurance Council of New Zealand chief executive Chris Ryan said people needed to be aware of what their policies contained.

There is "no standard policy" and companies can have a "very wide range of conditions".

It was also important for car owners to apply "reasonable maintenance" to their car, as they would for a house.

ellie.constantine@odt.co.nz

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