Court of Appeal backs Asteron Life in battle with former broker

Asteron Life has claimed a win in a long-running legal battle with Dunedin insurance broker Peter Taylor.

Wednesday, August 19th 2020, 4:39PM

The Court of Appeal released its judgment on Wednesday.

Taylor first took an Asteron Life income protection policy in 1994 and made a claim in 2010, saying he had bone cancer and suffered chronic pain.

Taylor was required to provide progress reports to Asteron describing the current state of his medical condition, whether he had been able to work, what income he had earned from working, and certain other matters.

He received payments until September 2014, when Asteron suspended them. It was concerned that he was earning at a level that would make him ineligible.

Taylor went to court seeking a declaration that he was entitled to continuing benefits under the policy, and wanting arrears of payments.

Asteron denied he was entitled to any further payments and counterclaimed for repayment of all sums previously paid.

It said he had made false statements about the extent to which he worked while on claim.

The High Court sided with Asteron and it was awarded $371,286.70. That court noted that he had used his insurance payouts to fund a holiday home, cars and overseas trips.

Taylor then took his case to the Court of Appeal, but it backed the High Court judgment.

“He has not established that he was 'totally disabled' (as that term was defined in the policy) between September 2014, when Asteron suspended payment, and April 2016, when Asteron cancelled the policy. Nor does the evidence establish that Taylor was entitled to any payment during that period even if he were 'totally disabled'.

“Rather, we agree with the judge that Taylor’s income from his insurance broking business was at a level that resulted in full abatement of any benefits he might otherwise have been entitled to under the policy during that period.”

The Court of Appeal said Asteron was entitled to succeed in its counterclaim but could only recover payments made in respect of the periods about which Taylor was found to have dishonestly provided false information.

“The judge declined to find that the initial claim made in July 2010 involved false statements that breached Taylor’s obligations in relation to making claims. So Asteron’s claim as pleaded, which was founded solely on the allegation of breach of utmost good faith, could not succeed in respect of the initial period from January 2010 to July 22, 2010.

“There may well have been another basis on which the payments made in respect of that period could have been recovered. But they were not pleaded by Asteron, and Asteron did not give notice that it intended to support the High Court judgment on grounds other than those accepted by the judge.”

That reduced the amount owed to Asteron by $51,835.64. Taylor has since sold his insurance broking business.

Tags: Asteron fraud insurance