Boat owner happy to win payout
By ZOE SINCLAIRzoe@gladstoneobserver.com.au
OCTOBER 2004: The Valerie Dawn crashed onto a reef and hours of love, attention and money were sunk. It broke owner Carl Prentice's heart and caused him no end of headaches chasing his insurance company for compensation.
The Valerie Dawn was fishing on Centenary Cay reef when a freak storm whipped up 50-60 knot winds and seas of five metres.
Before they knew it, white water crashing, winds roaring and ripping, the crew were battling not only to save the boat but themselves.
A stabiliser chain tore at the reef and stuck.
The crew was the only thing on Carl's mind when the stabiliser chain tossed the boat on to the reef.
'Emotionally it wrecked me,' Carl said.
"I had $100,000 of my personal gear ? how do you replace that?
'I'd spent two years doing it up ? there wasn't a boat like it in the marina.'
But if you thought his insurance company would simply foot the bill, then think again. When Carl sought compensation from the insurance company he came up against hidden costs, loopholes and evasive tactics.
Carl had to pay for the clean-up costs of removing his boat from the reef and received quotes of more than $100,000 for the job.
Carl said the insurance company would only pay half the cost of the clean-up and when Carl took the company to court over it and won, the company didn't pay legal costs.
'At first the insurance company wouldn't accept any liability ... then they were looking at everything to get out of payment, Carl said.
'The whole policy is misleading, these warranties and conditions are absolute garbage.
'You pay big money to be insured and you expect you will get paid out.'
But Carl is not alone in his situation.
Senior insurance adviser Marni Dittman said marine insurance law allowed loopholes, and it desperately needed to be changed.
'It is my view that there needs to be legislative changes in Australia to protect consumers of marine insurance products governed by the Marine Insurance Act in line with the Insurance Contracts Act,' Mrs Dittman said.
'This was recommended by the Law Society, however it has not been taken up to date.'
She said one area of the law in particular, breach of warranties, could mean that if a boat sinks due to weather and something entirely unrelated to the sinking, such as an out of date flare breached the warranty, some insurance companies would 'deliberately use warranties to avoid liability'.
Queensland Seafood Industry Association branch secretary Debbie Pershouse said it was another problem that fishermen didn't need.
'A lot of companies don't insure and then there are loopholes,' Ms Pershouse said.
'The cost is inhibiting for a start, but that is their livelihood.'