Shannons insurance clarifies its “driving into water” clause

Shannons Insurance recently updated its PDS around “driving into water” causing concern among four-wheel drivers, but we’ve cleared it up.

Not being insured is a major financial disaster for everyone, and particularly so for those of us with modified 4x4s. Aside from the huge cost of the vehicle, there’s the value of all the accessories including their fitment, and often a lot of your own effort involved too, even if that’s just time spent choosing the modifications, let alone actually getting on the tools and fitting them yourself as many of us do.

That’s why off-roading 4×4 owners choose specialist insurers who will value their vehicles based on the accessory fitment, and cover them for driving off-road. So when some keen-eyed people spotted these clauses in Shannon’s recently updated PDS (Product Disclosure Statement) it caused concern:


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So, we contacted Shannons, and a spokesperson quickly responded, saying: “The intent of the exclusion is for ‘Reckless Acts’ and each situation of driving into water needs to be viewed in that context, and assessed on a case-by-case basis.

“The term reckless implies acting without proper regard for the known dangers of a situation. It means to undertake an activity even though there is a reasonable expectation that it will cause damage or end poorly. For example; driving a passenger sedan into deep flood water is a well-known danger and is certainly reckless. Driving a 4×4 vehicle safely off road, including across wet areas or river crossings is not reckless unless it was obvious that the vehicle would not be able to make the crossing and the driver proceeds anyway.

“The Shannons policy offers coverage Australia wide. There is no exclusion for using a vehicle away from paved or gazetted roads and no exclusions around the type of terrain being navigated, be that dry, sandy or wet.”

Seems entirely fair to us – you’re covered, provided you behave sensibly. All insurers have similar exclusions which can be summed up as “don’t be a bloody idiot”. For example, the RACV excludes cover if, “you or the driver of your vehicle or a substitute vehicle was engaged in a wilful or reckless act while driving the vehicle”, although it doesn’t go as far as Shannons and define what a reckless act is.

While we’re talking insurance, a few things.

  • If you’re reading this, you’re probably a car enthusiast of some description, maybe you drive on racetracks, take your 4×4 off-road, tow a big caravan, and probably own at least one modified car. The standard insurance is for standard cars and standard people, and you’re neither. So, seek out specialist insurers for off-road 4x4s, track cars and the like. And you can get cover for club-plated vehicles or vehicles that aren’t road-registered, or project cars. You can even find cover for some racetrack events, within certain limits.
  • Always, always disclose all modifications because that affects the insurer’s view of risk, and you don’t want your claim denied. I use a spreadsheet listing the rego, each mod, cost, and especially the make and model. If I like my Ironman 4×4 suspension, I don’t want the insurer deciding to swap in the Ford OEM kit.
  • Don’t even think about insurance fraud such as the famous “oh yes I crashed right here, not 15km away on a closed track when my ambition exceeded my talent”. Insurance claims assessors are smart guys, there’s nothing they haven’t seen before, and you could probably do without a criminal record.
  • And if you’re not sure, query it. All insurers have hotlines to call, so don’t hesitate to double-check your understanding of policy wording. That could have saved a lot of worried people in the case of the Shannons water concern.

Check back on Motofomo as we’ll cover more on insurance for motor enthusiasts, and if you’ve got any interesting stories, please let us know.

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Automotive technical journalist specialising in 4X4s, camping, racecars and towing. Has designed and run driving courses covering offroading driving, winching, track racing and towing. Enjoys most things involving wings, wheels or sails. Follow me on Facebook and YouTube if you want explanations you won't find anywhere else!