EGR Delete - One thing I don't understand

[pajflareo]

Section 54

The relevant section is Section 54 of the Insurance Contracts Act 1984.

Parts of the section have been quoted here and there in some responses so may aswell include the whole section in this post.

It is a Commonwealth Act and governs all jurisdictions in Australia. So it applies to all Australian
Rego'd are that are insured.

In practice I have little experience with this section with respect to motor vehicles. It's primary application is to changes that occur after the contract of insurance is entered into, as opposed to undisclosed issues at the time of entering into the insurance policy.

The is also an issue of breach of utmost good faith that has to be considered (section 13 of the same act http://classic.austlii.edu.au/au/leg...84220/s13.html), as insurer's ask you if your car has been modified at the time of applying for insurance, so by saying "no" or not listing the EGR mod you are not acting in good faith.

In practice, the accepted position is that only modifications that may be related to the cause of the accident are examined.

However if the accident nudged the $20m policy limit then the insurer may start looking into some of these technicalities a little closer.

Section 54 Reads

INSURANCE CONTRACTS ACT 1984 - SECT 54

Insurer may not refuse to pay claims in certain circumstances

(1) Subject to this section, where the effect of a contract of insurance would, but for this section, be that the insurer may refuse to pay a claim, either in whole or in part, by reason of some act of the insured or of some other person, being an act that occurred after the contract was entered into but not being an act in respect of which subsection (2) applies, the insurer may not refuse to pay the claim by reason only of that act but the insurer's liability in respect of the claim is reduced by the amount that fairly represents the extent to which the insurer's interests were prejudiced as a result of that act.

(2) Subject to the succeeding provisions of this section, where the act could reasonably be regarded as being capable of causing or contributing to a loss in respect of which insurance cover is provided by the contract, the insurer may refuse to pay the claim.

(3) Where the insured proves that no part of the loss that gave rise to the claim was caused by the act, the insurer may not refuse to pay the claim by reason only of the act.

(4) Where the insured proves that some part of the loss that gave rise to the claim was not caused by the act, the insurer may not refuse to pay the claim, so far as it concerns that part of the loss, by reason only of the act.

(5) Where:

(a) the act was necessary to protect the safety of a person or to preserve property; or

(b) it was not reasonably possible for the insured or other person not to do the act;

the insurer may not refuse to pay the claim by reason only of the act.

(6) A reference in this section to an act includes a reference to:

(a) an omission; and

(b) an act or omission that has the effect of altering the state or condition of the subject-matter of the contract or of allowing the state or condition of that subject-matter to alter.

[BruceandBobbi]

(b) an act or omission that has the effect of altering the state or condition of the subject-matter of the contract or of allowing the state or condition of that subject-matter to alter.


Don't you just love legal talk.

[Hill]

EGR delete is for off road use only. This is why mine had a switch.

Fortunately I never switched it off!

Hill

[pajflareo]

(b) an act or omission that has the effect of altering the state or condition of the subject-matter of the contract or of allowing the state or condition of that subject-matter to alter.


Don't you just love legal talk.

Haha I love it, just rolls off the tongue.

The important section is

by reason of some act of the insured or of some other person, being an act that occurred after the contract was entered into

I read it as the insurer cannot refuse the claim if it was caused by an act or omission after the policy was taken out

So it seems like the EGR mod is (most often - except in the first year) an act that occurred before the policy was taken out.

However it is possible it could also be characterised as an omission in failing to keep the car roadworthy, reoccurring every time the car is on the road.

I like the idea of the switch. Assuming the switch meets the legal requirements of having an operative EGR it could then more easily satisfy the requirement of omission occurring after the policy was entered ie a failure to flick the switch.

[Dicko1]

Haha I love it, just rolls off the tongue.

The important section is

by reason of some act of the insured or of some other person, being an act that occurred after the contract was entered into

I read it as the insurer cannot refuse the claim if it was caused by an act or omission after the policy was taken out

So it seems like the EGR mod is (most often - except in the first year) an act that occurred before the policy was taken out.

However it is possible it could also be characterised as an omission in failing to keep the car roadworthy, reoccurring every time the car is on the road.

I like the idea of the switch. Assuming the switch meets the legal requirements of having an operative EGR it could then more easily satisfy the requirement of omission occurring after the policy was entered ie a failure to flick the switch.

If I was that paranoid about a $1.00 resistor effecting a possible insurance claim because I ran up the arse of another car...I,d sell the car and keep walking....carefree and no insurance worries..

[nj swb]

Section 54 Reads

INSURANCE CONTRACTS ACT 1984 - SECT 54

[I]Insurer may not refuse to pay claims in certain circumstances

...
(3) Where the insured proves that no part of the loss that gave rise to the claim was caused by the act, the insurer may not refuse to pay the claim by reason only of the act.

If you can prove that the EGR delete didn't contribute to the loss the insurer cannot refuse the claim.

Emissions aside, how does an EGR delete affect the safety of the vehicle i.e. how it drives / handles / brakes? An EGR delete cannot contribute to crashing into another vehicle, or crashing into the scenery, or rolling over, or brake failure, or drowning in a creek crossing, or the vehicle catching on fire, or some low-life scum-sucker stealing it, or vandalising it. The insurer might try to deny the claim due to the vehicle being "unroadworthy", but it shouldn't be too difficult to prove that the "defect" (EGR delete) didn't contribute to the circumstances of the claim.

If some rabid greenie sets your Pajero on fire in protest at your EGR delete? Then you're out of luck.

[Nab]

As above, non issue. The same as being worried about being 10kg over GVM, or 2kph over the speed limit, or lifted 5mm too high, or ..........

[Ian H]

EGR delete is for off road use only.

[Jasonmc73]

I am unsure why any repairer would check anything like that when you have a bingle, they would more likely check brakes, suspension, tyres and driveline, on the other hand if you were blowing excessive smoke and you got reported to the EPA then I would worry a little then.

Well put at what insurance assessors would be concentrating on

What the EPA would be concentrating on, although their is A fair chance EPA would just defect the vehicle from the probe up its pipe till fixed if it was excessive smoke.

Does anyone know of anyone that has been fined for EGR delete or DPF delete at this time? Has it happened? I get it could happen.

But be careful "Big Borther" is watching

[Jasonmc73]

:

Thats funny

[Dicko1]

Well put at what insurance assessors would be concentrating on

What the EPA would be concentrating on, although their is A fair chance EPA would just defect the vehicle from the probe up its pipe till fixed if it was excessive smoke.

Does anyone know of anyone that has been fined for EGR delete or DPF delete at this time? Has it happened? I get it could happen.

But be careful "Big Borther" is watching

Are you seriously this paranoid about this mod? Thousands of vehicles have this mod. Its standard practice to have it deleted when an ecu reflash is done . Concentrate on your driving skills and safety and dont have the mod done. You,ll sleep better at night...

[Jasonmc73]

Are you seriously this paranoid about this mod? Thousands of vehicles have this mod. Its standard practice to have it deleted when an ecu reflash is done . Concentrate on your driving skills and safety and dont have the mod done. You,ll sleep better at night...

LOL, it never even crossed my mind & to be quite honest I don't believe it would even cross an insurance assessors mind either.

Brakes, Suspension, tyres & the presence of seat belts & A steering wheel & I think he would be on to the next job!!

Any roadworthy I have ever had done it wouldn't even be picked up by roadworthy either!

[dreamerman]

Does anyone know of anyone that has been fined for EGR delete or DPF delete at this time? Has it happened? I get it could happen. But be careful "Big Borther" is watching

I think drivers must have a way to quickly restore the EGR back to stock as needed. Mine is a simple Chiptuning unit that can be quickly unplugged. For others using the solder resistor method would be harder to do so.

[pajflareo]

LOL, it never even crossed my mind & to be quite honest I don't believe it would even cross an insurance assessors mind either.

Brakes, Suspension, tyres & the presence of seat belts & A steering wheel & I think he would be on to the next job!!

Any roadworthy I have ever had done it wouldn't even be picked up by roadworthy either!

I work in insurance litigation and have worked claims for insurers.

In some cases the insurer will make an decision to further investigate a claim. Usually when the claim falls outside a certain parameter ie it is in the top 5% of claims for value for the type of accident, or another common one is when both drivers happen to have the same last name, or when there is evidence of significant pre-existing damage.

Rest assured that one starting point is to take your email and reverse search it through google. If it can be linked to a user name on a forum then your posts will be investigated. Maybe there's a post you have made admitting a car is not road worthy?

Once it is with lawyers, common-sense goes out the window. If there is information found on the forum that supports a ground to deny the claim then it will be investigated and denied (or rather a show-cause sent asking the insured to explain the situation).

The insurer doesn't even have to be right to give you trouble. I had a claim once for storm damage from a leaking roof. The damage was extensive, fell into the top 5% so the insurer appointed a Private Investigator to look at the merits of the claim. They tested a puddle of water in house and found fluoride.

To the insurer this meant the damage was staged and caused by tap water. The innocent explanation was that Insured had been using tap water to clean and mop up the dirty rain water coming through the roof cavity. Anyway insurer didn't budge so off to Court for that one.

[pajflareo]

If you can prove that the EGR delete didn't contribute to the loss the insurer cannot refuse the claim.

Emissions aside, how does an EGR delete affect the safety of the vehicle i.e. how it drives / handles / brakes? An EGR delete cannot contribute to crashing into another vehicle, or crashing into the scenery, or rolling over, or brake failure, or drowning in a creek crossing, or the vehicle catching on fire, or some low-life scum-sucker stealing it, or vandalising it. The insurer might try to deny the claim due to the vehicle being "unroadworthy", but it shouldn't be too difficult to prove that the "defect" (EGR delete) didn't contribute to the circumstances of the claim.

If some rabid greenie sets your Pajero on fire in protest at your EGR delete? Then you're out of luck.

Sub-section 3 is dependent on the first proviso in sub-section 1 being met, that it was an act or omission that occurred after the insurance contract was entered into.

i.e EGR before Insurance entered into can be denied and EGR after insurance cannot be denied.

With respect to the Greenie, for fire and theft components of a policy there are often different operative provisions and it is likely that there is no requirement that the car be roadworthy. You would be able to recovery directly from the greenie and probably send them bankrupt.