The industry ombudsman has found a broker breached its duty of care before a truck damage claim was rejected because a driver had less experience than the policy required.

Community Broker Network was approached by a client seeking a better option for its fleet cover, because a previous policy provided through a different broker did not offer Australia-wide protection. The previous cover did not have an inexperienced driver exclusion.

A new policy with nationwide cover and driver acceptability exclusions was emailed to the client on July 22 2022, and another truck was later added.

The schedule showed the answer “yes” to a question asking whether all drivers would have held licences for nominated vehicles for more than two years.

A renewal email sent on July 14 2023 asked the client to check the policy and list all people who may drive regularly.

“It is particularly important to note any under-25-year-old drivers, as they may impact on the policy premium and excess. If you do not notify us of any changes we will presume details previously advised to us remain correct,” the email said.

Changes were not requested and the policy was renewed for $59,802.

An accident involving a truck towing two trailers happened on October 6 2023. The truck was driven by a 24-year-old who had held a licence for that combination since September 6 and had held an Australian heavy rigid licence since February 2023.

The client said the broker failed to advise it of the exclusion and it concluded from the schedules that coverage was provided regardless of age and inexperience, even if a higher excess was payable.

It said it told the broker “we do train and hire all ages of drivers”.

The company later gained cover without the driver exclusion from a different insurer for $87,162.

In a dispute ruling, the Australian Financial Complaints Authority says moving to a policy with the exclusion was a significant change that should have been highlighted, and it is not sufficient for a broker “to send complex renewal documents to a client and ask that the client notify it of any changes that needed to be made”.

AFCA says the broker must “pay the complainant what would likely have been paid under such a policy less the excess and any additional premium payable for it”.

The sum is subject to a $316,000 cap, which is the maximum AFCA can award for a broker complaint.

See the decision here.