Insurer locked in legal battle after rejecting brothel’s claim

Insurer locked in legal battle after rejecting brothel’s claim | Insurance Business

Insurer locked in legal battle after rejecting brothel’s claim
NSW Supreme Court is examining a case in which Calliden rejected a claim by Stealth Enterprises’ Gentleman’ Club because the shareholders are allegedly members of a criminal motorcycle gang.

Stealth Enterprises’ brothel caught fire on New Year's day, causing a great deal of damage.

According to the Sydney Morning Herald, when the company lodged a claim with Calliden, the insurer denied it, stating that the company had failed to inform Calliden that its shareholders – Fidel and Baris Turkel – were connected to bikie gangs. Baris is said to have been a member of the Comancheros when the policy was taken, and Fidel, a member of the same gang or the Finks.

The brothel argues that Calliden is not entitled to such information. It says their policy covers it for $77,000 for damage and $250,000 for business disruption.

Calliden is said to have sent the brothel owners a list of 26 questions about their associations with the bikie gangs. The owners refused to answer them.

Calliden has declined to comment.
 
 
6 Comments
  • Leigh-Anne Byrom 2014-01-21 11:23:15 PM
    Insurer locked in legal battle after rejecting brothel’s claim... Interesting times...
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  • Mr R 2014-01-22 1:02:47 AM
    Time to see who wins the "Duty of Disclosure" battle ... I guess this is why the new DoD rules are coming into play so the insurers cannot ask the catch-all questions. This would have been an open-and-shut case if it was under the new rules.
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  • Kellie Smith 2014-01-24 1:51:58 AM
    The current legislation states that if the insurer has not followed up additional information required then it is deemed they have waived their rights to the info and accepted the risk. These issues are never black and white so it will be interesting to see the finer details emerge.
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