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I wanted a refund, not credit

Li booked a trip to Australia in March 2020 using an online travel service. The airline cancelled the trip, likely due to COVID-19. The airline provided a future flight credit for the value of the purchased tickets.

A condition of the flight credit was that it needed to be used before March 2022, but travel could be booked to start beyond this date. The expiry of the credit was later extended to July 2022.

In January 2022 Li requested a refund of her flight costs from the online travel service. She had not yet used the credit and did not want to travel in future due to her passport expiring. The online travel service declined Li’s request due to the airline credit.

Li then made a claim to her travel insurer. The insurer declined Li’s claim saying she had not suffered a loss because she had received the airline credit. Li disagreed with the insurer’s decision and complained to FSCL.


Li said that she had suffered a loss by not receiving a cash refund for her cancelled flights, particularly as she no longer wished to travel. She believed that her insurance policy covered such a loss.

The insurer said that Li had not suffered a loss as she had received a credit for the cancelled flight and that Li’s policy would not cover her claim.


We found that Li had not suffered a loss. While Li’s planned trip was cancelled and it may not have been convenient for her to book an alternative trip, she had not lost the value she paid for her flights due to the credit issued by the airline (which was still available at the time of Li’s complaint).

Li’s insurance policy would not cover her circumstances even if the airline had not given her a credit because Li’s policy did not cover foreseeable loss. The online travel service published an advisory the day before Li booked her flights advising that COVID-19 would be considered a foreseen circumstance effective immediately. We found that the exclusion policy applied to Li’s claim, as her flight had likely been cancelled because of low passenger demand and probable border closures due to COVID-19.

The policy also did not cover any losses which are recoverable from any other source. Li was able to recover her loss from the airline in the form of a credit, and therefore the insurer was not responsible for further covering the loss.


We recommended that Li discontinue her complaint. Li did not respond to our decision, so we closed the complaint file.

Insights for consumers

All insurance policies have exclusion clauses identifying circumstances that will not be covered by the policy. We encourage consumers to read the policy before buying the insurance so that they can see what events are covered and what are not.