A motor enthusiast who argued his Ford Mustang was sabotaged by another member of his car club has lost a claim dispute after the ombudsman found no evidence of a malicious act.

He bought the car from a second-hand dealer in March 2023, but only a few months later he heard a “ticking noise” in the engine. A roadside assistance mechanic found the engine oil level was too low.

The owner took the vehicle to the dealer, who said the engine had been damaged by low oil pressure and needed replacing.  

The motorist told Insurance Manufacturers of Australia his vehicle had been “running perfectly since purchase”, and he speculated that someone at a Mustang Club meeting he attended had drained oil from it.  

The insurer’s forensic engineer said any saboteur would have needed to use flat-ground jacking equipment, but there was no evidence this had occurred. No oil leak was detected.  

The engineer said there was evidence the car had been driven “very harshly”, with signs of heavy acceleration and braking. This could have caused it to consume oil more quickly than usual.  

In its dispute decision, the Australian Financial Complaints Authority says there is no evidence the vehicle was affected by malicious damage, and so no claimable loss has been established.

It finds the insurer’s explanation provides a valid reason for the oil loss.  

“The complainant has not been able to identify when the alleged malicious removal of the vehicle’s oil occurred, or who did it,” an AFCA ombudsman said. “He has no witness, nor any surveillance camera footage.

“I empathise with the complainant in that he has suffered damage to the vehicle he had only recently purchased.

“However, the evidence does not establish that there has been a malicious act, and it is fair that the insurer be able to deny the claim.”  

See the ruling here.

From the latest Insurance News magazine: From birds of a feather to towering achievements – find out who won this year's insurance ad oscars