December 2009/January 2010
Almost all motor policies include a clause that excludes cover for theft, attempted theft or malicious damage, if the ignition keys were left 'in or on the vehicle'. And, as we noted in issue 37 of ombudsman news (May/June 2004), the Court of Appeal's judgment in Hayward v Norwich Union Insurance Ltd was that the test of how such terms should be applied was whether the driver had moved too far away from the keys to make the prevention of theft likely. Since then, many insurers have reworded their clauses to exclude cover for theft if the vehicle was left 'unlocked and unattended' or if the keys were 'left in or on the vehicle'.
We are frequently called on to decide disputes where the consumer thinks the insurer has applied this exclusion unfairly in order to turn down a claim.
When deciding such cases, we take account of all the circumstances of the incident, paying particular attention to:
The following case studies illustrate some of the motor insurance complaints we have dealt with recently where the policyholder has disputed the insurer's use of the 'keys in car' exclusion.
Mr B, who ran a local delivery business, complained about his motor insurer's refusal to pay out after his van was stolen. He had left the van in the road nearby while he delivered goods from a hardware store to a customer's home. He admitted that he had left the keys in the ignition and the engine running (apparently to avoid running down the battery while he was on his delivery round). However, he said he had taken care to lock all the van doors, with a spare key, before he had left the vehicle.
He said he returned to the road just a few minutes later to find that his van had gone. The police later told him that the thief had broken into the van by smashing a window - and had then driven away. The insurer declined Mr B's claim, citing a 'keys in car' policy clause that excluded cover for theft in certain circumstances.
We noted that the 'keys in car' exclusion in Mr B's policy was worded in an unusual way. It said the insurer would not provide cover for theft where the ignition keys were left in or on the vehicle and the vehicle was left 'unlocked and unattended'.
Although Mr B did not dispute that he had left one set of keys in the ignition, he insisted that he had used his spare keys to lock the van before leaving it. And it seemed to us unlikely that the thief would have smashed the window unless he had found the doors locked.
We were satisfied that Mr B had not recognised the risk of theft as a result of leaving his keys in the ignition, and he had not acted recklessly.
We told the insurer that as Mr B had not left his van 'unlocked', it could not apply the exclusion. We therefore upheld the complaint and told the insurer to pay the claim.
Mr G's car was stolen while he was having a meal in a fast-food restaurant. He said that after parking the car outside the restaurant he had removed the keys from the ignition and checked that all the doors were locked. He had then put his car keys in his coat pocket and gone in to the restaurant.
The restaurant was fairly quiet and Mr G left his coat and a newspaper on a table close to the food counter before going up to get his food. He admitted that he did not look over to the table to check his belongings, even though he stood waiting for several minutes before he was served. It was only after Mr G had eaten his meal and was getting ready to leave that he discovered the keys were missing from his coat pocket. He went outside and found that someone had taken his car.
The insurer refused to pay Mr G's claim. It said he had breached a policy condition that required him to 'take reasonable care' of his car - and it considered he had been 'reckless' in leaving his keys 'unattended'.
In 1993, the Court of Appeal considered 'reasonable care' conditions in the case of Sofi v Prudential Assurance. It decided that in determining whether or not someone had taken 'reasonable care' of their property, the test was whether they had deliberately courted a risk or taken measures that they knew were inadequate to protect the property. In either case, this lack of care was tantamount to 'recklessness', and meant that the person in question did not care what happened to their property.
In the light of this judgment, in order to determine whether the insurer had been entitled to reject Mr G's claim, we had to be satisfied that Mr G had acted recklessly in leaving his keys unattended.
It was clear from the evidence provided by Mr G that the restaurant was relatively quiet; he had expected to be served right away; and he had left the keys just a couple of metres behind him. We were therefore satisfied that Mr G had not recognised the risk of theft and had not acted recklessly when leaving his coat - with the car keys in the pocket - on the table. Since we did not think Mr G had 'deliberately courted' the risk of theft, we told the insurer to pay the claim.
A construction worker, Mr K, complained about the way in which his motor insurer dealt with his claim for theft. His van was stolen one afternoon, while he was working on a building site. He said that an urgent problem had arisen with the mechanical digger he was operating, and he had gone to fetch some tools from the back of his van, in order to fix the problem.
He had quickly gone back to the digger, which was just a few metres away from the van, and had left the back doors of his van open and the keys on top of his jacket, which was on the ground next to the van.
The theft took place while Mr K was mending the digger. He said the mechanical problem had not taken very long to fix - but it had been more complicated and had required more concentration than he had expected. He accepted that this must have diverted his attention briefly from the van, providing someone with the opportunity to steal it. However, he thought that his insurer had acted unfairly in telling him it was unable to pay out because he had left the van 'unattended'.
We noted that although Mr K had left the rear doors of the van open - with the keys nearby - he had never been more than a few metres away from the van. He had been working on private property that was sufficiently well secluded to prevent access by casual passers-by. And we accepted his view that, while mending the digger, he had been close enough to the van to be able to intervene if he saw anyone attempting to steal it.
So we were satisfied that Mr K could not be said to have left the van 'unattended' - nor had he acted recklessly, as he had not appreciated that the vehicle was at risk of theft. We therefore told the insurer to meet Mr K's claim
Mrs D's insurer turned down the claim she made on her motor policy after her car was stolen from the driveway of her house. She said the car had been taken one morning, while she was preparing to leave for work. Several minor domestic problems had needed sorting out before she set out. Immediately before leaving the house she had therefore rung her manager to warn him she might be a little late.
She said she had already got into the car and started it up when she realised she still had the house phone with her. She left the car on the driveway, with the engine still running and the driver's door open, while she took the phone back to the house. Very shortly afterwards, she came out to find that the car had gone.
The insurer refused to pay out, as it said she had left the vehicle 'unattended'. Mrs D disputed this and eventually referred her complaint to us. She said she had left the car where it was clearly visible to her husband. At the time he had been in the living room, which faced the driveway at the front of the house.
complaint not upheld
In this case there was no question that the keys had been left in the car and the doors unlocked - Mrs D admitted as much when making her claim. She maintained that the car could not have been out of her sight for more than 10 seconds. She said she had not seen anyone 'hanging around' near the driveway, and she had neither seen nor heard the car being driven away.
After looking carefully at photographs showing the driveway and exterior of Mrs D's house, we concluded that her recollection of events surrounding the theft might not have been wholly accurate. We thought it unlikely that within so short a period of time anyone could have been in a position to have seen Mrs D leave the car - and to then have made their way to the vehicle, got in it and driven away - all without being seen or heard.
We also noted that although the car might have been left in a spot where it was visible from Mrs D's house, neither she nor her husband could have been watching it while she returned the phone - otherwise one or both of them would have seen the theft taking place.
In the circumstances, we were satisfied that the vehicle had been left unattended and that the risk of theft would have been apparent to Mrs D. We said it was reasonable for the insurer to have turned down the claim, citing the 'keys in car' exclusion. We did not uphold the complaint
Mrs J complained about her insurer's refusal to pay for the theft of her car. Her husband, who was included as a 'named driver' on the car's insurance policy, had gone out in the car to the local supermarket. He had stopped off on his way home in order to post a letter. He said he had parked the car and crossed a busy road to reach the post box. As he turned round to make his way back to the car, he saw it being driven away.
The insurer cited the 'keys in car' exclusion in order to turn down the claim. He admitted having left his keys in the ignition and the car door unlocked when he got out of the car to post the letter. Mr J acknowledged that he had been 'silly to take a chance'. However, he said it was unfair of the insurer to rely on such an 'unreasonable' exclusion, which he had not been told about and which meant he and his wife would lose the entire value of the car. Unable to reach agreement with the insurer, Mr and Mrs J brought their complaint to us.
complaint not upheld
The insurer sent us a recording of the phone call during which Mrs J had bought the policy. In the course of this call, the insurer had explained the 'keys in car' exclusion to Mrs J. We noted that the exclusion was also clearly and prominently set out in the policy document.
We did not accept Mr J's view that the insurer was at fault for not telling him about the exclusion. Mrs J was the main driver and the insurer had properly drawn the exclusion to her attention. We thought it reasonable of the insurer to have expected her to pass on the information to her husband.
We concluded that, in view of the circumstances in which the theft took place, the insurer had not acted unfairly in applying the policy exclusion. We did not uphold the complaint.
For more information on our approach to disputes involving keys left in cars, see our technical note.
For printed copies of this or any of our publications, phone 020 7964 0092 or email publications.
ombudsman news gives general information on the position at the date of publication. It is not a definitive statement of the law, our approach or our procedure.
The illustrative case studies are based broadly on real-life cases, but are not precedents. Individual cases are decided on their own facts.