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ombudsman news

issue 120

September 2014

travel insurance - alcohol exclusions

Last year travel insurance made up only 2% of our overall caseload. But that still means more than 2,000 people felt their claim had been unfairly turned down.

Each year we see the same issues crop up time and again within travel insurance complaints - and we’re finding that businesses aren’t settling complaints in line with our well-established approach. In fact, last year we upheld 53% of travel insurance cases referred to us - up from 42% in 2011.

We’re often asked to step in when an insurer is insisting that someone had been drinking alcohol before having an accident - and is refusing to pay out as a result. The majority of travel insurance policies exclude cover for events that happen after excessive alcohol consumption - but that doesn’t mean holidaymakers will only be covered if they don’t drink at all.

In some cases, we find that terms describing alcohol consumption aren’t clearly defined in the policy - or have been unfairly applied by the insurer to reject a claim. For example, we see cases where insurers accuse their customers of “alcohol abuse” or “alcoholism”, even though medical evidence shows they only had one or two drinks.

Similarly we see cases where insurers have jumped to conclusions about what had happened - for example, because of someone’s age or the particular resort they were in. But it’s our job to look at the evidence. We’ll consider any medical reports and accounts of what happened when making our decision.

As with all insurance cases, it is up to an insurer to show that an exclusion applies, not for their customer to show that it doesn’t. We expect a high standard of proof from insurers - proof that’s consistent with other evidence. We generally put more weight on evidence from blood tests - and less on one-off remarks by a doctor at the time of any accident.

If we decide a claim should have been paid, we’ll tell the insurer to meet it, adding interest.

Sometimes, the consequences of an accident are particularly sensitive or distressing - for example, the death of a family member, or an upsetting experience in a foreign hospital. If an insurer has wrongly turned down a claim, we’ll consider whether this caused additional upset for their customer. We’ll also take into account whether someone has been pressured for payment of medical expenses that should have been covered.

Equally, we’ll explain to the consumer if we think that, on balance, the insurer made the right decision in the circumstances.

issue 120 index of case studies

  • 120/1 - consumer complains that insurer wrongly accused him of "alcohol abuse" when rejecting his claim
  • 120/2 - consumer complains that the diagnosing doctor wrongly identified excessive drinking - leading to a rejected claim
  • 120/3 - consumer complains that alcohol exclusion couldn't apply - as he hadn't been drinking
  • 120/4 - consumer complains after his insurance claim is declined - saying he'd drunk a normal amount for someone on holiday
  • 120/5 - consumer complains that insurer has rejected claim on grounds of "excessive" alcohol consumption
  • 120/6 - consumer's brother complains that insurer has rejected claim - on grounds that alcohol consumption contributed to his sister's death
  • 120/7 - consumer complains that insurer has linked hospital admission to alcohol consumption

consumer complains that insurer wrongly accused him of "alcohol abuse" when rejecting his claim

Mr J was on holiday in Australia, enjoying a night in a bar in Sydney. Unfortunately, during the night he had an accident - falling down some stairs. He injured himself quite badly - breaking a leg and suffering severe head trauma. He was taken to a hospital and treated for his injuries, including emergency surgery to remove a blood clot that was potentially life-threatening.

When Mr J was able to, he submitted a claim to his travel insurer to reimburse his medical bills. But after a short investigation, the insurer turned down his claim. They said that they had evidence that he’d drunk an excessive amount of alcohol - and blamed his fall on the amount he’d had to drink.

The insurer said that they had a witness account from the bar manager, who said that Mr J had bought numerous shots, glasses of wine and beers. The insurer also said that the doctor treating Mr J had noted that Mr J “smelled of alcohol” when he’d been admitted into hospital.

The insurance policy excluded cover for claims arising because of, among other things, “alcohol abuse, alcoholism”. The insurer said that Mr J’s actions had constituted “alcohol abuse” - and so the event wasn’t covered.

Mr J was very unhappy, so he complained about the insurer’s decision. But when they wouldn’t change their stance, he decided to turn to us for help.

complaint upheld

The insurer shared their evidence with us - sending us the bar manager’s witness account and the doctor’s report. When we looked at the manager’s statement we noticed that it only said that Mr J had bought a number of drinks - there was no mention of how much he’d personally drunk.

So we asked Mr J to share his side of the story with us. He told us that he’d been out in a bar with a few friends. He had bought a number of drinks, but he’d only had two pints - most of the drinks he bought had been for his friends. He told us that during the night he’d had a drink spilt on him, which he said was probably why the doctor smelled alcohol on him.

Mr J had been drinking - he admitted that. What we had to determine was whether the amount he’d had to drink meant that his insurer could fairly reject his claim.

We looked at the policy that Mr J had, and in particular the exclusion to do with alcohol. It said “You are not covered for anything caused as a consequence of: … alcohol abuse, alcoholism”. Neither “alcohol abuse” nor “alcoholism” was defined.

As neither term was defined, we took the common meaning for each of them. Alcoholism is a dependency on alcohol, and alcohol abuse typically means prolonged or regular over-consumption of alcohol. Neither of these definitions seemed to match Mr J’s behaviour.

We decided that the insurer didn’t have enough evidence to back up their rejection of his claim. So we told them to pay his claim, with interest.

consumer complains that the diagnosing doctor wrongly identified excessive drinking - leading to a rejected claim

Mrs D was on a cruise holiday, when she became unwell. The ship’s doctor examined her, taking notes about her circumstances and how she felt. The doctor said that Mrs D should go to a hospital when they next docked.

At the hospital, Mrs D was checked by another doctor. He told her that she was suffering from acute pancreatitis. Mrs D received treatment and was discharged. When she left the hospital, she put in a claim on her travel insurance to cover her medical bills and the cost of getting home.

But when her insurer looked into her claim, they rejected it - saying they wouldn’t pay a claim “arising from the influence or effect of alcohol.

Mrs D was baffled, and wanted to know how the insurer had reached their decision. They said that they had a report from the doctor at the hospital which said that Mrs D’s pancreatitis was caused by her “extensive history of alcohol use”. The report also said that Mrs D had drunk “an extraordinary volume of alcohol immediately preceding her illness”.

Mrs D explained that she’d had an injury a few years earlier which had caused pancreatitis - but that had been treated successfully. She said she’d never been a heavy drinker. She also contested the doctor’s point about her drinking an “extraordinary volume of alcohol”.

But when the insurer wouldn’t change their stance, she complained. Both sides reiterated their sides of the story - but neither party would budge.

Mrs D was getting quite frustrated - so brought the matter to us.

complaint upheld

To get some context for Mrs D’s pancreatitis we asked her GP for her medical records. When we looked through them, we could only see one reference to alcohol. About ten years earlier there was a note saying “light drinker”. Apart from that, there was no mention of alcohol - and importantly no mention of “extensive use” of alcohol.

We also got the medical report from the ship’s doctor who had originally helped Mrs D. In it, the doctor noted that Mrs D had last drunk three nights before she felt unwell - and it hadn’t been an excessive amount.

Mrs D told us that the hospital’s doctor had said that he was teetotal. She said that he’d seemed quite judgemental - and suggested that he might have been prejudiced against her as a result.

Much of the evidence we had seen was contradictory. No blood tests had been carried out, which would have definitively shown how much alcohol Mrs D had in her system when she became ill.

We couldn’t say for certain exactly what had happened. But the evidence Mrs D had provided called into question the accuracy of the hospital doctor’s report. Given this, we didn’t think the insurer had done enough to prove that Mrs D’s condition had arisen “from the influence or effect of alcohol”. So we told the insurer to pay Mrs D’s claim, including interest.

We also told them to pay Mrs V £300 for the stress she’d been put through trying to make her claim, while she was receiving demands for payment from the hospital.

consumer complains that alcohol exclusion couldn't apply - as he hadn't been drinking

While he was on holiday in Canada, Mr O became unwell. He went to a local hospital and they assessed him. The doctors diagnosed him as having “alcohol withdrawal symptoms” and began treating him.

When he felt well enough, Mr O submitted a claim to his travel insurer so they could reimburse his medical costs.

His insurer looked into the matter and then decided to reject his claim. They said to Mr O that he wasn’t covered for anything relating to “alcohol abuse” or “alcoholism”.

Mr O complained. He said that he had gone to hospital after a severe panic attack - and hadn’t drunk anything before the incident. He said that the insurer couldn’t turn down his claim based on anything to do with alcohol, because he hadn’t drunk any.

Mr O and his insurer’s conversations were becoming more strained - so Mr O approached us for some help.

complaint not upheld

The insurer sent us a copy of the terms and conditions of Mr O’s travel insurance policy. The policy was quite clearly set out. It prominently said that circumstances related to “alcohol abuse” or “alcoholism” wouldn’t be covered.

So we had to decide if Mr O’s circumstances were covered by the policy, and whether the insurer was fair in their decision to reject his claim.

We asked the insurer for a copy of the hospital’s report from when Mr O was treated. As Mr O had said, he had been admitted following a severe panic attack.

But the doctor had noted that the reason for his panic attack had been “ethanol withdrawal” and he was showing “alcohol withdrawal symptoms”.

In order for someone to display symptoms of ethanol withdrawal, we considered it likely that there had to have been prolonged and heavy use of alcohol. The hospital report also indicated that Mr O had been a heavy drinker in the months leading up to the trip.

So while we could see Mr O’s logic that he should be covered because he hadn’t drunk anything, we disagreed with his interpretation of the terms and conditions.

We appreciated that this must have been a stressful event for Mr O. But we told him that the insurer hadn’t acted unreasonably in declining his claim.

consumer complains after his insurance claim is declined - saying he'd drunk a normal amount for someone on holiday

Mr K’s daughter lived abroad, and as he hadn’t seen her in a while he took some time off work and went to visit her.

One night near the end of his holiday, he fell and injured himself quite badly. He went to hospital, where he was examined and treated. Once he was able to, he called his travel insurer to tell them what had happened, and to put in a claim for his medical expenses.

The insurer looked into the matter, but they turned his claim down. They said that they wouldn’t pay “any claim arising directly or indirectly from … excessive alcohol intake.” They said that they had evidence from the doctor who treated him that Mr K was “heavily intoxicated”.

Mr K challenged this. He said that there had been an uneven floor, and he hadn’t drunk an unusual amount for someone on holiday.

The insurer wouldn’t change their decision - so Mr K complained to us.

complaint not upheld

First we wanted to see what evidence the insurer had used to decline Mr K’s claim.

They sent us two things - the results of a blood test and the notes that the doctor had made following Mr K’s admission to hospital.

The blood test showed that Mr K’s blood alcohol content was particularly high - roughly four times the UK driving limit. The doctor’s notes also said that Mr K “appeared intoxicated” and had “impaired mobility”.

Having such a high concentration of alcohol in his blood almost certainly affected how steady his movements were. And taken together with the doctor’s statements about Mr K’s condition, it didn’t seem unreasonable for the insurer to reject Mr K’s claim as they had. So we didn’t uphold Mr K’s complaint.

consumer complains that insurer has rejected claim on grounds of "excessive" alcohol consumption

Mrs M took a week’s holiday in Greece with her sister and some friends. After the group had visited a beachside bar one evening, she returned to her room at their villa. Unfortunately, she hit her head on a bedside table as she was getting into bed, and needed to go to hospital for stitches and overnight observation.

Once she was discharged, Mrs M contacted her travel insurer to claim back her medical expenses. But the insurer wouldn’t pay out - saying Mrs M had been over the UK driving limit when the accident happened. In their view, it was clear Mrs M’s injury was alcohol-related - and their policies excluded claims “arising directly or indirectly from excessive alcohol intake”.

Mrs M complained. She told the insurer she’d been honest on the claim form about what she’d had to drink. But she didn’t feel three drinks over the course of an evening was “excessive”. In any case, she thought the accident would have happened anyway - she’d just got into bed awkwardly.
When the insurer refused to reconsider, Mrs M referred her complaint to us

complaint upheld

We explained to the insurer that if they wanted to reject Mrs M’s claim, it was for them to show the alcohol exclusion applied - rather than for Mrs M to prove it didn’t.

We asked to see the medical evidence that the insurer has used to decide Mrs M had been drinking “excessively”. We were sent the results of tests that had been carried out when Mrs M was admitted to hospital - which showed that her blood alcohol level was above the UK driving limit. This broadly corresponded with what Mrs M had herself told the insurer she’d had to drink.

But when we looked at the terms and conditions of Mrs M’s policy, we found they didn’t actually define what the insurer meant by “excessive” alcohol intake. And by an everyday definition, we didn’t agree that what she’d drunk was necessarily an “excessive” amount for a holidaymaker who wasn’t planning on driving - especially over a long evening.

Taking these facts together, we came to the view that the insurer had reached an unfair conclusion. People can be clumsy and have accidents even when they’re sober.

From what we’d seen, we decided the insurer had wrongly rejected Mrs M’s claim. So we told them to pay her medical expenses, with interest.

consumer's brother complains that insurer has rejected claim - on grounds that alcohol consumption contributed to his sister's death

Miss H died after falling down the stairs of the French house she’d been renting one autumn. Her brother, Mr H - acting for her estate - claimed on her travel insurance for the payment available if the policyholder died.

After considering the claim, the insurer decided not to pay out. They told Mr H that medical evidence showed Miss H had drunk a significant amount of alcohol before the accident. And their policies excluded claims arising “directly or indirectly from excessive alcohol intake”.

Mr H complained. He felt the insurer was wrong to link Miss H’s death to alcohol - because she could have slipped and fallen anyway. He said he couldn’t believe the insurer wouldn’t cover anyone who’d been drinking, because it was clear holidaymakers would drink. He argued that if Miss H had known about the exclusion, then she wouldn’t have bought that policy in the first place.

But the insurer maintained that they’d made the right decision. Upset and frustrated, Mr H asked us to step in.

complaint not upheld

We agreed with Mr H that many holidaymakers have a drink. But the exclusion in Miss H’s policy wasn’t unusual - and it was very unlikely she could have found a policy with another insurer that didn’t exclude alcohol-related claims. The things we needed to consider were how much Miss H had had to drink - and whether her fall, and her death, were linked to this.

We asked the insurer for the medical evidence they were using to turn down the claim. They sent us Miss H’s death certificate, which said that “alcohol intoxication” had been a “contributory cause” of her death.

We also saw a toxicology report carried out as part of the post-mortem. This showed Miss H’s blood alcohol concentration had been extremely high - at a level that would have caused severe “ataxia” (problems with balance and coordination) and poor judgement.

We thought these conclusions - reached by independent experts - were very strong evidence that Miss H’s alcohol consumption had contributed to her death. In the circumstances, we decided that it was reasonable for the insurer to make that link - and turn down the claim under their alcohol exclusion.

It was clearly a very difficult time for Miss H’s family. When we let Mr H know, he was very disappointed - but said he understood our decision.

consumer complains that insurer has linked hospital admission to alcohol consumption

One evening, while on holiday with his parents in Croatia, Mr S collapsed and was admitted to hospital. Fortunately, he was discharged after a few hours. But he did run up medical fees - and once he was back in the UK, he contacted his travel insurer to claim them back.

But the insurer refused to pay out. They told Mr S they’d received a report from the Croatian hospital confirming he’d been admitted with “alcohol intoxication”. This meant Mr S’s fees fell under the insurer’s exclusion for claims arising “directly or indirectly from using alcohol”.

Mr S didn’t think this was fair. He accepted he’d had a drink that evening, but maintained he hadn’t been drunk. He felt the hospital had made assumptions because he was a man in his twenties staying at a resort popular with partygoers. And he was angry the insurer had taken their word for it - rather than looking at the facts.

When the insurer refused to change their mind, Mr S asked for our help.

complaint upheld

Many people are likely to have a drink on holiday. So we didn’t think it would be reasonable for the insurer to automatically reject Mr S’s claim just because he’d had a drink. Instead, the issue was whether Mr S’s collapse - and the claim - was caused by his alcohol consumption.

We asked the insurer for a copy of the hospital report they’d mentioned. This showed that Mr S’s blood alcohol level had been half the UK driving limit when he was admitted. We didn’t think this was excessive.

Mr S sent us a letter from his GP confirming that, since returning to the UK, he’d asked for help finding out why he’d collapsed. The GP said that, though the cause wasn’t yet obvious, there were a number of possible explanations - from dehydration to an underlying condition.

Based on everything we’d seen, we weren’t convinced Mr S’s claim was related to whether, or how much, he’d been drinking. And because the insurer hadn’t shown the exclusion applied, they needed to meet the claim. We told them to refund Mr S’s medical fees, with interest.

image: ombudsman news

ombudsman news gives general information on the position at the date of publication. It is not a definitive statement of the law, our approach or our procedure.

The illustrative case studies are based broadly on real-life cases, but are not precedents. Individual cases are decided on their own facts.