Power Report: Give your insurer all the details - or it might cost you

The devil is always in the detail. And usually in the dull fine print most of us overlook - until it's too late.

It was a truth brought home yet again by two separate insurance cases this month. The scenarios were almost identical, involving the same insurer, but with one difference: the responses to the insurer by the two consumers were poles apart. And it has cost one of them tens of thousands of rands.

The first case involved an accident in Durban. The motorist had been out on the town and slept over at a friend's house. The accident in which his car was written off happened at about 8am the next day.

When processing his claim, Outsurance requested his bank records for the periods before and after the accident. He hesitated, queried the request with me, then complied. His claim was paid out.

Driver B responded differently. Soon after he claimed for an accident in Johannesburg in the early hours of the morning - after his car collided with an Uber taxi that had allegedly jumped a robot - he was asked for cellphone beacon and billing records as well as bank statements. Uncomfortable with the request for such private information, he supplied neither. His claim for the R77 000 Mazda written off in the crash was repudiated.

The main reason, said Outsurance, was the claimant's "failure to comply with our reasonable instructions and requests". Added to this was his failure to provide true and complete information, and an allegation that he had been driving under the influence of alcohol.

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The latter two issues led to the request for personal records.

The driver told his insurer - and me - that he had spent the evening visiting a friend, drinking coffee and watching a TV series. He denied drinking that day or night. The police accident report backed this up, saying alcohol use was not suspected.

But due to "discrepancies" in his story, and witness statements, Outsurance requested the records.

"This information is necessary to understand the driver's whereabouts and activities prior to the collision and to confirm if the sequence of events provided is correct," said spokeswoman Natasha Kawulesar.

"We also requested bank statements ... [they] will show if there were any purchases made during the time he states he was at his friend's home."

Kawulesar said the discrepancies related to the manner of entering the complex where the friend lived. The driver said his friend opened the gate via a remote control, but the friend told the insurer she gave him a code to enter. Outsurance investigations revealed the complex did not allow for code entry, and visitors needed to sign in. The insurer said there was no entry for the driver in the visitors' logbook.

As for the drunk driving allegation, it would seem police reports don't hold much water after all.

"We have on a few occasions seen police reports that indicate no suspicion of alcohol yet drivers end up admitting being intoxicated - as well as witnesses describing drivers as being under the influence," said Kawulesar. "We unfortunately cannot comment as to why this might happen."

So much for that, then.

But is it OK to demand personal records from customers? It is, and it is stated clearly in the fine print of the contract.

"When we validate the claim, we rely on as much information as we can obtain, which is both circumstantial and objective evidence, to paint a picture of the most probable scenario," said Kawulesar.

Independent witnesses, including a fire brigade officer, claimed the driver smelled of alcohol. His behaviour - aggressive and swearing - also apparently made them "believe" he was intoxicated.

The driver admitted to me he was "a bit aggressive" that night but said it was due to his refusal to leave the scene until the police arrived, and because of the presence of several uninvolved Uber drivers.

Without a blood test or breathalyser, surely his alcohol level is speculation?

Can Outsurance prove categorically that he was drunk, I asked.

It seems it doesn't have to. Unlike a criminal matter, where proof beyond reasonable doubt is needed, in civil matters like this, all insurers have to show is that on "a balance of probabilities" the driver was under the influence.

"We are unable to comment on what the driver may have had to drink prior to the collision, but the statements of the witnesses and his behaviour indicates that he was most probably intoxicated," said Kawulesar.

Following repudiation, the cellphone records were supplied to Outsurance, and on Friday, the driver reluctantly submitted his bank statements.

"The balance of probabilities is that the driver is not giving us correct information on the events leading up to the collision and the consumption of alcohol." Kawulesar said that if new information showed the insurer was incorrect, it would "gladly" settle the claim.

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The driver could take the matter to the short-term insurance ombud. But his reluctance to supply all requested records won't help his case. The ombud office believes insurers are entitled to request reasonable information needed to validate a claim. Said senior assistant ombudsman Peter Nkhuna: "Since the insurer is only interested in validating the claim, and will only use the information for this purpose, the obvious thing to do would be to comply with one's contractual obligation rather than risk the nonpayment of your claim."

Howard Dembovsky, chairman of Justice Project South Africa - a nonprofit organisation focused on corruption in law enforcement and the promotion of road safety - is preparing a detailed appeal to the ombud on the issue.

"This 'balance of probabilities' nonsense is just that - nonsense," said Dembovsky.

"Insurance companies are engaging in an extremely questionable and, in my opinion, unlawful practice, and relying on a 'balance of probabilities' where properly legislated and well-thought-out procedures [related to the criminal offence of drunk driving] are prescribed."

Accident reports were generally poorly compiled, but this did not give insurers latitude to make up their own "evidence".

"I am not suggesting that insurance companies should not be entitled to repudiate claims where it is proved that the driver of the vehicle was under the influence of alcohol. However, the way they are going about it at the moment is tantamount to 'bush justice' and unscrupulous business practice," he said.

Until, or indeed if, the status quo changes, insured drivers should consider themselves warned.

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