skip tocontent

ombudsman news

issue 105

September/October 2012

travel insurance

Travel insurance covers a wider range of risks than any other type of insurance - and the cases we see involve a wide variety of different issues.

We know from our experience that many consumers expect travel insurance to cover any and every eventuality. But travel insurance policies contain strict limitations and exclusions on the cover they provide - and the amounts an insurer would have to pay if a consumer made a successful claim. Often, consumers only become aware of these restrictions when they need to make a claim. So these restrictions form the basis of many of the complaints we see.

We appreciate that travel insurance claims can be stressful and difficult to sort out. So we make allowances for the difficulties both insurers and customers can have - faced with unfamiliar surroundings, limited information or different time zones.

Our online technical resource contains more information about how we approach cases involving travel insurance. The case studies that follow illustrate some of the more common problems we see - including claims relating to:

  • "pre-existing medical conditions";
  • lost belongings;
  • cancelled holidays; and
  • "non-disclosure" of information.

issue 105 index of case studies

  • 105/1 - complaint involving a rejected claim for a holiday cancelled due to a "pre-existing medical condition"
  • 105/2 - consumer complains about claim rejected because trip did not meet conditions for a "journey"
  • 105/3 - consumers complain about a rejected claim for a missed flight
  • 105/4 - consumer complains about medical expenses claim rejected because of a "pre-existing medical condition"
  • 105/5 - complaint about a medical expenses claim rejected because repatriation "had not been necessary"
  • 105/6 - complaint about a rejected claim for lost luggage
  • 105/7 - complaint about a medical expenses claim rejected for "non-disclosure"
  • 105/8 - complaint about the automatic renewal of a travel insurance policy
  • 105/9 - complaint about a rejected claim for a missing bag
  • 105/10 - complaint about rejected claim for lost baggage
  • 105/11 - complaint about a claim for cancellation made due to the policyholder's ill-health

105/1
complaint involving a rejected claim for a holiday cancelled due to a "pre-existing medical condition"

Mr and Mrs T booked a short break to Rome to celebrate their wedding anniversary. They booked their trip online, and took out travel insurance at the same time. A few weeks before they were due to travel, Mrs T's father was diagnosed with lung cancer. They decided to go ahead with the holiday. Sadly, on the day they were due to fly out, Mrs T's father died. They cancelled their trip and made a claim under their travel insurance for the cost of the holiday.

Their claim was rejected on the basis that Mrs T's father had a "pre-existing medical condition".

The insurer said that when they had taken the policy out, they would have been asked whether "anyone upon whom the travel plans depend" had been to a medical consultation or received treatment within the last two years for asthma, bronchitis, or any other lung or respiratory condition.

The insurer pointed out that Mrs T's father had been to his doctor with a cough and shortness of breath two months before they had taken out the insurance.

Mr and Mrs T complained to their insurer, saying that when they took out the policy, they had no reason to believe that Mrs T's father was seriously ill - and in fact they couldn't recall him having been to the doctor. When the insurer rejected their complaint, they referred the matter to us.

complaint upheld
As always, we looked at the evidence and listened to both sides of the argument. We decided that even if the couple had been aware that Mrs T's father had been to see his doctor with those symptoms, they couldn't be expected to have thought of what had seemed like a single episode of illness in terms of a "lung or respiratory condition" - or to have realised that their insurer would have wanted to know about it.

When we put this to the insurer, they said it was irrelevant whether the couple had been aware of Mrs T's father's illness - because pre-existing conditions were simply not covered by the policy. They said it didn't matter whether a customer was aware of a condition or not.

We pointed out to the insurer that rejecting a claim on this basis could mean that a customer - acting in good faith - could take out a policy and later discover that they had no cover. And we decided that in Mr and Mrs T's case, if the insurer was going to take this approach it would have needed to have done more to explain the implications to them when they took out the policy.

In these circumstances, we upheld the complaint - and told the insurer to put things right by paying the claim.

105/2
consumer complains about claim rejected because trip did not meet conditions for a "journey"

Mr W decided to take his nephew to a theme park. He booked a coach trip, which included an overnight stay. Because Mr W already had an annual travel insurance policy he did not take out any additional cover.

Unfortunately, the day before they were due to travel, Mr W's nephew broke his leg. Mr W had to cancel the trip - and he made a claim under his travel insurance policy.

The insurer turned down Mr W's claim. It said that his trip did not meet the policy's definition of a "journey". Under the terms of his policy, a journey within the UK would only be only covered if he had travelled at least 25 miles away from his home, and had stayed for two or more nights in pre-arranged accommodation.

Mr W was unhappy with this response, so he complained to the insurer. He said it should have drawn his attention to the exclusion when he took the policy out - and that he would not have taken it out in the first place had he known about the exclusion. When his complaint was rejected, he referred the matter to us.

complaint not upheld
We were satisfied that Mr G's policy clearly stated that it only covered UK trips of at least two nights. We did not think this exclusion was unusual, so we would not have expected the insurer to have drawn it specifically to Mr W's attention.

We also asked Mr W why he had taken the policy out in the first place. He told us that he had needed it to cover some trips abroad that he had planned to make during the course of the year. But he was adamant that he would not have taken the policy out if he had known about the exclusion relating to UK travel.

Having considered all the arguments, we thought it was likely that even if the insurer had drawn this particular exclusion to his attention, he would still have taken the policy out.

We did not uphold the complaint.

105/3
consumers complain about a rejected claim for a missed flight

Mr and Mrs E booked a summer holiday to Parga in Greece. On their way to the airport, they were stuck in traffic because the police had closed the motorway. Unfortunately, they missed their flight. They phoned their insurer straight away, but could only get through to the medical assistance helpline - who couldn't help them.

Mr and Mrs E tried to find a different way of getting to Parga. They looked at various options but couldn't find any direct flights. And because other flights were last minute, they were expensive. In fact, they cost almost as much as Mr and Mrs E had paid for the holiday in the first place. Concerned about the cost and the inconvenience, they decided to abandon their holiday and go home.

When Mr and Mrs E got home, they made a claim for the cost of the holiday under their travel insurance. Their claim was turned down. The insurer said that although they were covered for a missed departure - and could have claimed up to £500 per person for alternative travel - they were not covered if they chose to cancel their holiday.

Mr and Mrs E complained to their insurer, saying they had looked into all the options and hadn't been able to find any appropriate alternative flights. When their complaint was rejected, they asked us to look into it.

complaint upheld
The fact that Mr and Mrs E were covered for missing the flight - because of exceptional and unforeseeable traffic conditions - was not in dispute. And if they had arranged alternative travel, the insurer would have paid their claim. So we needed to look into the options that had been available to them at the time.

We did some research ourselves and found that direct flights to Parga were very limited. We did establish that Mr and Mrs E could have booked a flight to a different airport - but that would have been to a different part of Greece and would have meant a difficult and time-consuming onward journey.

However, at such short notice - and faced with the prospect of a long and complicated journey - we could understand why they had decided to abandon their holiday. We could also see why they had been concerned about the cost - especially when they hadn't been able to get hold of anyone at the insurer who could help them.

In these circumstances, we concluded that it was fair and reasonable for the insurer to pay the claim. We told it to pay the couple the cost of the holiday, less the policy excess. We pointed out that this figure was probably lower than the amount it would have needed to pay if Mr and Mrs E had managed to organise alternative travel to Parga - and had claimed for those costs.

105/4
consumer complains about medical expenses claim rejected because of a "pre-existing medical condition"

When Mr and Mrs P booked a holiday to Thailand, they took out an annual travel insurance policy. Two days into their holiday, Mrs P developed a cough and was having trouble breathing. She was taken into hospital and diagnosed with a chest infection. Mr P contacted their insurer to ask for help.

The insurer contacted Mrs P's GP in the UK to discuss her condition. Five days later, someone from the insurer phoned Mr P to let him know that it wouldn't provide cover - because Mrs P had a "pre-existing medical condition".

When they returned to the UK, Mr and Mrs P complained to the insurer. They said that they had not deliberately given misleading information. They also complained about how long it had taken the insurer to make a decision about the claim - which they said had forced them to build up additional medical expenses.

When the insurer rejected their complaint, they referred the matter to us.

complaint not upheld
When we reviewed Mr and Mrs P's policy documents, we found it was set out very clearly that they would not be covered if, during the previous five years, either of them had "suffered from or received medical advice, treatment, or medication" for a number of conditions - including breathing conditions.

We also looked at the medical notes supplied by Mrs P's GP. The notes showed that she had been diagnosed with "chronic obstructive pulmonary disease" a few weeks before their insurance policy had been taken out.

In these circumstances, while we accepted that Mr and Mrs P had not set out to mislead the insurer, we did not think its decision had been unreasonable - because the claim had clearly been excluded by the policy.

We then looked at how long it had taken the insurer to make its decision. Although the insurer had taken five days to get back to Mr P with its decision, we established that it had waited three days to receive the information it needed from Mrs P's doctor. So we did not think the insurer had caused an unreasonable delay.

We did not uphold the complaint.

105/5
complaint about a medical expenses claim rejected because repatriation "had not been necessary"

Mr and Mrs F went on holiday to Tuscany. While they were away Mrs F experienced an upset stomach and abdominal pain. Mr F, a surgical consultant, decided that his wife needed to be brought back to the UK as quickly as possible for treatment.

He and his wife had travel insurance as part of their joint bank account. So he contacted their insurer's medical helpline to ask them to help. Instead of making arrangements to repatriate Mrs F, the insurer suggested that Mr F take her to a local medical centre so that she could be examined. The insurer told Mr F that he needed medical advice on whether repatriation was necessary - and whether his wife was fit to fly.

Instead, Mr F paid £5,000 for a private aircraft and they flew back to the UK. When they got back, Mrs F was treated for mild gastritis.

Mr and Mrs F submitted a claim under their travel insurance for the costs of the flight home - which their insurer turned down. It said that Mr F had not followed the advice he had been given by their medical helpline.

Unhappy with this, Mr and Mrs F made a complaint. They said the wording of their policy had not given a clear explanation of the service offered by the medical helpline - and that Mr F had not felt able to trust the advice he had been given because staff were not medically qualified.

When the insurer rejected their complaint, Mr and Mrs F referred the matter to us.

complaint not upheld
We listened to both sides of the argument and looked at the evidence. When we reviewed Mr and Mrs F's policy document, we were satisfied that it had explained the service offered by the medical helpline.

The document said that where necessary, an experienced member of staff on the helpline would coordinate an appropriate response - including dealing with appropriate hospitals. They would also consult medical advisers on treatment and any possibility of repatriation.

The document also made it clear that only reasonable travel costs would be paid, and that a repatriation claim would only be paid if it was "confirmed to be medically necessary" by a medical practitioner. Although Mr F was a medical practitioner, he had not been able to explain why repatriation had been medically necessary - especially when adequate medical facilities had been available in the local area.

It was clear that the insurer's medical helpline had not thought it necessary - or appropriate - to repatriate Mrs F immediately - not least because she may not have been fit to fly.

We did not think this had been unreasonable in the circumstances.

We appreciated that Mrs F's condition would have been very worrying for her husband. However, we did not think that arranging private repatriation had been reasonable or proportionate. So we did not uphold the complaint.

105/6
complaint about a rejected claim for lost luggage

Mr and Mrs M booked a cruise from Miami to the Bahamas. To join the ship, they needed to fly to Philadelphia and get a connecting flight to Miami. Unfortunately, the flight to Miami was cancelled because of bad weather - and they were asked to board a flight to Tampa instead.

When they arrived in Tampa, they waited at baggage reclaim for Mr M's suitcase. When it didn't appear, they spoke to a member of staff at the airline - and were told that the suitcase had gone missing. They boarded the cruise ship, and explained the situation immediately to a member of staff. The ship's staff helped them make some more enquiries about the missing suitcase, but it was never found.

Mr M submitted a claim to his travel insurer. The insurer turned down his claim, saying he should have reported the matter to the police. Unhappy with this response, Mr M made a complaint. When this was rejected, he referred the matter to us.

complaint upheld
We looked at Mr and Mrs M's policy document. We found that to make a successful claim, they would have needed to report a missing item "to the police, or another relevant authority". Although they had not reported the missing luggage to the police, they had reported it to the airline and the cruise company - and been given a reference number by both. So we decided that they had reported the loss to a "relevant authority" - and satisfied the conditions set out in their policy. We told the insurer to put things right and deal with their claim in line with the policy conditions.

105/7
complaint about a medical expenses claim rejected for "non-disclosure"

Mr and Mrs D booked a holiday to Australia. They decided to take out some travel insurance - and spoke to the insurer's medical helpline to answer some questions about their health. During the conversation, Mr D told the adviser that he suffered from diabetes. The adviser said that he could still be covered, but would need to pay an additional premium.

Unfortunately, while they were away, Mr D became ill and was taken to hospital. He was told that he had had a heart attack. Mrs D contacted their insurer, and was told that it would make some enquiries with Mr D's GP in the UK before confirming whether it would accept the claim.

The GP told the insurer that Mr D had been taking regular medication for high blood pressure and high cholesterol. The insurer then turned down Mr D's claim. It said if it had known he had been taking medication for these conditions, it would not have sold him the policy.

Mr D disagreed with the insurer's decision. He pointed out that his policy specifically said that high blood pressure and high cholesterol would be covered as long as they were well controlled. He argued that his were. When the insurer rejected his complaint, he referred the matter to us.

complaint not upheld
We listened to both sides of the argument. We noted that Mr D had told the insurer about his diabetes. But when we asked him why he hadn't told the insurer about his high blood pressure and high cholesterol, he couldn't give us a reasonable explanation.

We also looked at transcripts of the conversation between Mr D and the adviser on the insurer's medical helpline. When Mr D was asked whether he had "ever been advised to take medication for high blood pressure" he said "no".

In light of the evidence, we decided that the insurer had acted reasonably in rejecting Mr D's claim, and we did not uphold the complaint.

105/8
complaint about the automatic renewal of a travel insurance policy

Mr O knew he would be going abroad a few times in one year, so he took out an annual travel insurance policy. During the year, his insurer sent him the occasional email about his policy and other travel-related updates. Just before Mr O's policy was due to expire, his insurer renewed it automatically - and he was charged £60 for the premium. Mr O complained to the insurer, saying that he had not intended to renew the policy and that he had not been made aware that it would happen automatically.

The insurer responded, telling Mr O that the automatic renewal had been explained in the paperwork he had been given when he had taken out the policy. The insurer also said it had written to Mr O before the policy was due to expire to let him know that it would be renewed - unless he got in touch with them within 14 days to ask them not to renew it.

Mr O told the insurer that he had not received a letter from them - and that the first he'd heard of it was when he checked his bank statement. He also asked why they hadn't got in touch with him by email - just as they had been doing all year. When the insurer stuck to its original position, Mr O asked us to look into the matter.

complaint upheld
Weighing up the facts, we had no reason to doubt that the insurer had sent Mr O a letter. But we also accepted his argument that he had never received it.

Although Mr O's policy documents did make it clear that the policy would be renewed automatically, we wouldn't usually expect a consumer to remember this a year later. So the dispute turned on the way the insurer had alerted Mr O to the renewal.

The insurer said it had written to him. But we took into account the fact that it had sent Mr O emails throughout the year - and so we could understand why he had assumed he would get an email about the renewal. And we also noted that the "cooling off" provisions in the policy - which explained his right to cancel - said that the insurer would communicate with the customer by email.

Taking all this into account, we concluded that the insurer had not taken reasonable steps to alert Mr O to the fact that his policy would be renewed automatically. We accepted that Mr O had not wanted to renew his policy - and told the insurer to refund him the £60 renewal premium plus interest.

105/9
complaint about a rejected claim for a missing bag

Mr R and a colleague were in India on a business trip. They travelled from Mumbai to Delhi by train. The train was very crowded and Mr R left his briefcase in the luggage compartment. When they arrived in Delhi, Mr R realised that his briefcase had gone missing. He was particularly upset because the briefcase had been a present from his wife. It was an expensive designer brand - and it had also contained his laptop. He reported the incident to railway staff and to the police.

Mr R made a claim under his travel insurance policy. His insurer turned down the claim on the basis that he had failed to comply with the conditions of the policy - which stated that he "must take all reasonable precautions to safeguard belongings from loss, damage or theft". It also excluded "loss, theft of or damage to valuables left unattended at any time".

Mr R complained to the insurer. He said that when he had referred to the luggage compartment, he had actually meant the space under his seat. He also told the insurer that he had only left his seat a couple of times to use the toilet - and that his colleague had been looking after the briefcase while he was away from his seat. He argued that he had therefore taken reasonable precautions to safeguard his briefcase, and that he had not left it unattended.

When the insurer refused to change its mind, Mr R referred the matter to us.

complaint not upheld
When we looked into the detail of the case, we could find no clear evidence to show where Mr R had left his briefcase - or where his colleague had been sitting when the briefcase went missing.

However, what was not in dispute was the fact that the briefcase was clearly valuable. We thought this would have made it particularly attractive to a thief. So bearing in mind how valuable the briefcase and its contents were - and how crowded the train had been - we were surprised that Mr R hadn't taken more care to make sure this particular item was safe.

Taking all the circumstances of the case into account, we concluded that the insurer had acted reasonably in turning down Mr R's claim.

105/10
complaint about rejected claim for lost baggage

Mr and Mrs A were staying in a hotel in Austria. On the last morning of their holiday, they were due to travel by coach to the airport. They checked out of their room and left their luggage with the hotel porter to be loaded onto the coach while they had breakfast.

When they came back to the reception area, their luggage was missing. The hotel couldn't explain exactly what had happened, but they thought the porter must have put the luggage on the wrong coach. Unfortunately, they never managed to track it down.

When they got home, Mr and Mrs A submitted a claim for their lost luggage. Their insurer rejected the claim. It said that their policy terms excluded "any personal belongings or baggage you lose or are stolen while they are not in your control or while they are in control of any person other than an airline or carrier".

Mr and Mrs A complained, saying that they would expect a hotel porter to be considered a "carrier". But when the insurer disagreed, they referred the matter to us.

complaint upheld
Having looked carefully at the circumstances, we took the view that Mr and Mrs A had acted reasonably when they had left their suitcases with the porter. After all, it was his job to handle luggage and they would have expected it to be in safe hands. We also thought they could reasonably expect their insurance to cover such an ordinary scenario - especially as their policy had not defined what it had meant by a "carrier".

We concluded that had Mr and Mrs A been aware they would not be covered in these circumstances, it is likely they would have acted differently - and would probably have kept their luggage with them. So we told the insurer to pay the claim, plus interest.

105/11
complaint about a claim for cancellation made due to the policyholder's ill-health

Mrs B occasionally suffered from sinus pain and migraines but was otherwise in excellent health. However, on a visit to her local supermarket, she felt dizzy and passed out for a few minutes.

Though this was an isolated incident, she made an appointment with her GP just in case there was a wider problem. Mrs B saw the doctor a few days later, explaining in the consultation that she had felt perfectly well beforehand.

Looking at her symptoms and medical history, her doctor concluded that her dizzy spell had most likely been related to a migraine. However, to be on the safe side, he though it would be a sensible precaution for Mrs B to have a brain scan - to rule out any possibility that her fainting was symptomatic of a more serious issue, like a minor stroke.

In his referral letter to the hospital, the doctor stressed that he did not think Mrs B had suffered a stroke. But he wanted to have the scan in order to "rule this out once and for all".

Mrs B's appointment for the scan was in early January. A couple of weeks earlier, she had booked and paid for a holiday and taken out a travel insurance policy. The holiday was due to start shortly after the hospital appointment.

The result of the scan confirmed that Mrs B had in fact suffered a minor stroke. She was told that because of this, she shouldn't fly for at least six months. As a result, she cancelled her holiday.The insurer rejected Mrs B's claim, saying that the policy contained an exclusion that meant cover would not be offered for:

€ ... any condition of which the policyholder was aware at commencement of the policy or for which he/she received advice, treatment or counselling from any registered medical practitioner during the 12 months preceding the commencement date, whether diagnosed or not."

complaint upheld
Though the insurer was insistent that the consumer was legitimately excluded from making a claim, we disagreed. When she had taken out the policy, both Mrs B and her doctor had thought that the one-off incident of fainting had been caused by a migraine - not by a stroke.

We told the insurer that we considered its reliance on this policy exclusion to reject Mrs B's claim neither fair nor reasonable. Our approach to this kind of exclusion is longstanding. And we have highlighted similar complaints in previous issues of ombudsman news - so we were disappointed that this case had to be referred to us to resolve.

We said the insurer should pay the claim - along with interest from the date of the cancellation. We also said it should compensate for the distress and inconvenience it had caused Mrs B by its decision.