In May 2016, Phil took out pet insurance for his dog Herbie. In January 2017, Herbie became very unwell and Phil took him to an animal hospital where Herbie remained overnight.
Phil submitted a claim to his insurer for the costs of Herbie’s overnight stay ($2,000). Phil wrote on his claim form he was claiming for Herbie trembling, being lethargic, and vomiting.
In his initial communication with the insurer, Phil asked it to pay his claim as soon as possible. The insurer’s staff member replied saying ‘they would get that sorted for him’.
Eventually, the insurer declined Phil’s claim because its policy contained a clause excluding a claim where clinical signs (meaning changes in a pet’s normal healthy state, bodily functions, or behaviour) that Herbie displayed in January 2017 were the same as those he had in the first 21 days of cover. The insurer said the exclusion also applied because Herbie appeared to be a dog susceptible to gastric issues.
Phil did not agree with the insurer’s decision and complained to FSCL.
Although we agreed Herbie had had a number of gastric issues since the policy started, we did not agree with the insurer that, because Herbie appeared to be a dog susceptible to gastric issues, the exclusion applied. The only relevant consideration was comparing the clinical signs Herbie had in the 21-day period following inception, and the clinical signs he had in January 2017.
We reviewed Herbie’s medical history and could see that in the 21-day period after the policy was taken out, Herbie had diarrhoea, vomiting, lethargy, and the vet noticed he chewed toys. These signs were also present in January 2017. However, we could understand Phil’s argument that there were a number of clinical signs present in January 2017 that were not present in mid-2016.
For example, although an entry from May 2016 said Herbie was a little lethargic, he was also ‘bright, eating, and playing’. In contrast, the notes from January 2017 said that Herbie had been unwell for 3 days, vomiting, and had to receive IV fluids and antibiotics.
The overall impression from reading the notes from the two periods was that Herbie was significantly more unwell in January 2017 than mid-2016.
It also appeared that a contributing factor to Herbie feeling so unwell in January 2017 was that he had an ear inflammation which in part caused him to tremble.
However, although Herbie was displaying additional clinical signs in January 2017, this did not mean the exclusion clause did not apply. This was because Herbie displayed clinical signs in the first 21 days of cover that were the same as the clinical signs he displayed in January 2017.
The wording of the insurer’s exclusion clause was very wide, and it had applied the clause correctly to decline Phil’s claim.
Although the insurer had correctly declined the claim, we considered its service could have been better. The insurer gave a clear initial indication that Phil’s claim was going to be paid. We considered the insurer should pay Phil $100 for the inconvenience caused when the insurer later declined the claim.
Phil was disappointed with the outcome of our investigation, but he accepted the $100 in full and final settlement of his complaint.
As with all insurance policies, pet insurance policies can include widely worded exclusions, especially relating to pre-existing medical conditions, or past clinical signs displayed by the animal.
This case highlights the importance of reading policies carefully at the time you are taking out insurance to ensure they cover what you expect. Most insurers give customers a ‘free-look’ period (usually for around two weeks), where the customer can cancel the policy and receive a refund of premiums, if the customer decides the policy doesn’t actually meet their requirements.