Darshan booked a holiday in Switzerland and Shanghai from 27 January to 19 February.
On 1 February, while on holiday, Darshan found out that his dog was unwell. The dog was limping, not playing and sleeping a lot. Because Darshan was really close to his dog and worried about his health. Darshan returned to New Zealand on 2 February.
On 15 February Darshan resumed his trip and flew to Shanghai. Upon his return to New Zealand, Darshan made an insurance claim for the costs of his interrupted travel. Darshan believed he would have cover because his ‘close relative’ had suffered an acute illness.
When the insurer declined to pay Darshan’s claim, he complained to FSCL.
Darshan took out the insurance policy in good faith. Because he considered his dog to be a family member, and the policy stipulated there was cover for ‘close relatives’ Darshan reasoned he would have cover. Darshan pointed to hospitals and rest homes who now recognise pets as family members
Darshan thought he should have been told upfront if he wouldn’t have cover for issues relating to his pets.
The insurer noted that all policies are subject to terms and conditions and do not cover all losses incurred. While cover would be provided for a “close relative suffering an unforeseen illness,” the policy exhaustively defined what close relative meant. Although a lot of familial relationships were recognised in this definition, they were all human relationships.
As a result, Darshan’s claim was not covered under his policy.
Insurance policies are contracts between the insurer and the insured. In this instance, the policy clearly defined ‘’close relatives’’ as meaning only human relatives.
Further, the insurer could not have forewarned Darshan that losses arising from a pet’s illness wouldn’t be covered because it couldn’t anticipate Darshan would make a claim of this nature.
Although we sympathised with Darshan, and did not doubt his genuine belief that his dog was a close relative, we agreed with the insurer’s decision to decline the claim. Darshan agreed to discontinue his complaint.
Key insight for consumers
It pays to read your policy carefully, including the policy’s special definitions, so that you understand what you are, and are not, covered for under the policy.