Loss of Property 'Unattended in a Public Place': Testing the Good Faith of the Travel Insurer

Travel insurance policies require insureds to take adequate precautions to protect their personal property including their luggage. They exclude cover for the loss or theft of personal property which has been left ‘unattended in a public place’. The relevant authorities on this exclusion including the often-cited decision by Lord Denning MR in Starfire Diamond Rings Ltd v Angel in 1962 would appear to give the final word to the insurer. However, case law is mixed and shows that a determined insured would have a good chance of success on appeal. The fact that insurers regularly reject claims which are successful on appeal is another example of conduct of the finance sector falling below community standards and expectations as demonstrated in the recent Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (2018–19). Wrongly rejecting claims can expose the insurer to several potential legal liabilities at common law and under statute. This article recommends deleting the intricacies of the standard exclusion for property being left ‘unattended in a public place’ in favour of the standard policy condition that the insured must take adequate precautions to protect their personal property. It also recommends amendments to the Corporations Act 2001 (Cth) to empower the Australian Securities and Investments Commission to regulate the claims procedures of insurers.