CR198 Non-disclosure – whether evidence supported insurer’s view
Non-disclosure – whether evidence supported insurer’s view that false information had been disclosed
The insured applied for 2 policies during late 1999 through a broker for R1,5 million with inception date 1 November 1999 and 1 April 2000. In response to a question in the application form the insured answered that his occupation was “flying”. The insured was subsequently required to complete an Aviation questionnaire in which the insured indicated that he had a “commercial” pilot’s licence.
The insured died in an aeroplane accident on 2 April 2000. Claims were instituted for death benefits under both policies.
An investigation was launched which resulted in the insurer concluding that the insured did not hold a valid commercial pilot’s licence but only a private pilot’s licence. They repudiated liability.
The claimant’s representative argued that the Civil Aviation Authority’s (CAA) records were inaccurate and that the insured had in fact held a commercial pilot’s licence. As evidence he submitted that :
1. the CAA had more than once inspected the insured’s licence at his workplace where he had been employed as a commercial pilot and had not raised any questions about his licence.
2. the aeroplane operating certificate showed the insured as the named pilot.
What complicated matters was the fact that no original licences were available. These had been confiscated by the Moçambiquen authorities where the accident had happened.
We took all of the above into account as wel as the 2000 Report of an Independent Review Panel into Fraudulent Air Transport Licence Examination Practices which stated:
“After the aircraft accident on 2 April 2000, two pilot’s licences were found in Delacovia’s bag. The Moçambique authorities took possession of these documents, and submitted faxed copies to the CAA. In addition, the pilot’s logbook was obtained from his family, and in the back of the logbook was a copy of the pilot’s licence printout that is usually handed to a pilot after he renewed his licence. On this copy the information reflected Delacovia as a holder of CPL and instrument rating issued by the CAA. The information in this licence print-out is not consistent with Delacovia’s pilot’s records held by the CAA. The Panel concludes that Delacovia did not hold a valid CPL with instrument rating.”
The report did reflect that the records of the CAA are not accurate.
In weighing up the evidence the probabilities were fairly evenly balanced but the abovementioned report weighted against the insured. In applying the test for the materiality of information one uses the reasonable insured test. The reasonable insured would never disclose false information. On the evidence our office found the evidence supported the insurer’s position that the insured had disclosed false information about his pilot’s licence. Consequently we could not find in favour of the complainant on the documents on file.
We had been made aware of the fact that the insured’s wife could not afford to institute legal proceedings. A court might have been a more appropriate forum for dealing with the dispute of facts of this nature. At the representative’s request we, therefore, asked the insurer to consider an ex gratia payment. We were able to advise the widow that an offer of R250 000 had been made in full and final settlement which she accepted.