Insurance Helpline With Cedric Stephens

Question: I wish to inform myself of facts about stolen motor vehicles that are the subject of insurance. I have owned and insured a motor vehicle for many years. I wanted to sell it and buy another vehicle. I was in the process of selling it but because I had to be mobile before it was sold, I bought another vehicle and parked it for a day at my house uninsured and unlicensed. Later that same night, thieves entered my premises and stole the newer vehicle. I was told that even though it was uninsured I could still put in a claim. Is this true?

- jennie.bennie@gmail.com

HELPLINE:

Persons who are buying or selling motor vehicles need to exercise extreme caution. Life, limbs and property are at risk.

Recent news reports tell the story of a young man who was murdered and his body tossed from the car he was selling along the Spur Tree Road and the vehicle stolen.

That incident occurred during what was supposed to be a test drive.

Last Thursday, this newspaper related another case in which two brothers from St Mary went to buy a vehicle in Clarendon. The sale was planned to take place on the premises of the May Pen Police Station.

When they arrived there, they were tricked to move from the apparent safety of those premises to a nearby lane. They were ambushed, robbed and pistol-whipped by two masked men.

The deal of a lifetime turned out to be a near-death experience. In the face of these facts, the stealing of your car - the same day that you bought it - is unlikely to be a random event.

Not entitled to claim

You are not entitled to submit a claim for the vehicle which was stolen. Why? The insurance policy or contract contains specific information about the insured vehicle.

Details include: the registration number, year of make, manufacturer, model, chassis and engine numbers and estimate of value. The protection which is afforded under the contract can, therefore, only be applied to the vehicle that is described in the policy.

Comprehensive policies almost always impose a duty on policyholders to 'give immediate notice to the police' in the case of 'theft or other criminal act which may give rise to a claim'.

Making a false report to the police is against the law in many places, including Jamaica. This can lead to criminal prosecution.

Insurance companies hate persons who are believed to have used or attempted to use fraudulent means to get insurance money. This is much in the same way that farmers hate those who reap what they have not sown!

Claims involving the theft of motor vehicles are carefully investigated. Insurers' default position in these cases is to assume everything is not above board until proven otherwise.

Where fraud can be proved, an insurer will almost always provide evidence of the wrongdoing to the police. Also, they will refuse to pay.

Where fraud is suspected but is difficult to prove, they play hardball. The downside risks - your peace of mind, reputation, the likelihood of jail time plus the possibility of not being paid - are simply too high.

Finally, it is plain wrong to submit a claim under the circumstances in which you lost your car.

The upshot to your story is that the thieves could have broken in to your home and could have hurt you and your family.

Cedric E. Stephens provides independent information and free advice about the management of risks and insurance.aegis@cwjamaica.comSMS/text message to 812-7233