Insurer Rejects Claim Over Diesel Fluid Mix-Up

The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.

A contentious insurance claim has ended unfavourably for a motor policyholder after her husband mistakenly poured diesel exhaust fluid into her car's fuel tank.

Although the policyholder initially received assurances from a Suncorp representative that the use of AdBlue fluid wouldn't be considered improper fuelling - supposedly an excluded scenario under her policy - the claim was later denied.

This decision has sparked debate around policy definitions and customer service communication.

The policyholder argued that according to the product disclosure statement (PDS), only "incorrect fuel usage" was excluded, and as AdBlue is technically not a fuel, her claim should be valid. Additional grievances arose after alleging the insurer’s tow service inflicted further damage to her car, necessitating a new steering rack and wheel realignment.

Suncorp acknowledged the issue with its initial claim rejection, where the decision was based solely on the original PDS. However, the insurer pointed to a supplementary product disclosure statement (SPDS), which explicitly excludes coverage for damage resulting from using fluids not recommended by the vehicle's manufacturer. This key differentiation was reportedly communicated to the policyholder during her policy renewal.

The Australian Financial Complaints Authority (AFCA) sided with Suncorp, determining that the insurer did not mislead the customer about her claim status. While Suncorp admitted to referencing outdated PDS wording initially, AFCA deemed their reliance on the updated SPDS appropriate and found no obligation for the insurer to cover the incident. Additionally, AFCA found limited evidence to support the policyholder's accusations regarding damage caused by the towing service, reinforcing Suncorp's account of a winched, non-dragged vehicle recovery.

Despite these rulings, AFCA ordered Suncorp to compensate the policyholder $3000 for delay-induced inconveniences during the claim process, which left her without her vehicle for an extended period, citing the resulting undue stress and hassle.

This case highlights the importance of clear communication and understanding of policy amendments, emphasizing the role supplemental documents play during insurance assessments. Consumers are reminded to review documentation thoroughly during renewals to grasp the full scope of their insurance protections and exclusions.

Published:Wednesday, 16th Apr 2025
Author: Paige Estritori

Please Note: We do not endorse any specific products or companies. Some content is sourced from third parties, including press releases, and may not be independently verified for accuracy or completeness.

Share this news item:

Insurance News

APRA's Updated Reinsurance Framework: What Insurers Need to Know

14 May 2026: Paige Estritori

The Australian Prudential Regulation Authority (APRA) has recently refined its reinsurance framework to facilitate insurers' access to alternative reinsurance arrangements, including insurance-linked securities (ILS) and catastrophe bonds. This initiative aims to balance the need for flexibility in reinsurance options with the imperative of protecting policyholders. - read more

APRA's New Capital Treatment for Longevity Products: Implications for Insurers

14 May 2026: Paige Estritori

The Australian Prudential Regulation Authority (APRA) has finalised amendments to its prudential standards concerning the capital treatment of longevity products, including annuities. These reforms are designed to bolster the market for retirement income solutions by aligning capital requirements more closely with the long-term nature of these products. - read more

The Rising Cost of Regulatory Compliance in Australia's Insurance Sector

14 May 2026: Paige Estritori

Australia's general insurers are raising concerns about the escalating costs associated with regulatory compliance, which they estimate to be up to $3.5 billion annually. This substantial financial burden is reportedly contributing to higher premiums and affecting the industry's productivity. - read more

Comprehensive 2025 Life Insurance Data Released by APRA and ASIC

14 May 2026: Paige Estritori

The Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC) have jointly released the Life Insurance Claims and Disputes Statistics for the year ending December 31, 2025. This publication provides a detailed analysis of the performance of the Australian life insurance industry, offering valuable insights for policyholders and industry stakeholders alike. - read more

Click for more Insurance News

Life Insurance Articles

Start Here !

Apply now for your free Insurance assessment and price comparisons!

All quotes are provided free and without obligation. We respect your privacy.

Knowledgebase

Endorsement:
An amendment or addition to an existing insurance policy that changes the terms or scope of the original policy.

IMPORTANT: We are neither authorised nor licensed to provide finance or finance products. We do not recommend any specific financial products and we do not offer any form of credit or other financial advice. All product enquiries and requests for financial and/or other advice on this website are referred to third party, qualified intermediaries with whom you can deal directly. We may receive a fee or commission from these third parties in consideration for the referral. Before any action is taken to obtain a product or service referred to by this website, advice should be obtained (from either the third part to whom we refer you or from another qualified intermediary) as to the appropriateness of obtaining those products having regard to your objectives, financial situation and needs.