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“Left high and dry.”

In August 2015, Andrea booked travel for her and her husband to Hawaii, from 27 December 2015 to 4 January 2016. On 23 December 2015, Andrea’s GP recommended they cancel the trip because Andrea had suffered an adverse reaction to a change in her regular medication. Andrea’s GP had changed her medication because it was thought to be causing Andrea to suffer from a dry mouth / lack of saliva.

Andrea made a claim to her travel insurer for the costs of the cancelled trip ($8,200).

The insurer declined Andrea’s claim

The insurer said that it was unexpected that Andrea had the adverse reaction to the medication. However, it also said that at the time Andrea activated the travel insurance policy she was aware of, and had received medical treatment and advice about, her dry mouth / lack of saliva. In addition, the condition required ongoing investigation.

This meant that the cancellation was caused by Andrea’s pre-existing medical condition (PEMC). There was an exclusion in the policy excluding claims arising directly or indirectly out of a PEMC and, on this basis, the insurer declined the claim.

Andrea complained to FSCL.

Andrea’s view

Andrea said the change in medication was not only because of her dry mouth condition, but also because of her possibly having another disease which was diagnosed in the time between when she activated the travel insurance cover, and when she and her husband were supposed to travel to Hawaii.

Andrea also said she had dry mouth issues for years, however, sometime in May 2015 the symptoms became worse and she felt her salivary glands had become enlarged. It was only because of this change that she saw her doctor who then referred her to a specialist. Andrea was referred to a few specialists over the following months.

Only after Andrea met with a specialist in November 2015 (that is, after the travel insurance was activated), did her doctors first discuss that it might be her existing medication that was causing her dry mouth. The change in medication (which Andrea had the adverse reaction to), only occurred after the travel insurance was activated.

Our review

We looked at the PEMC exclusion clause in the policy. The phrase ‘arising directly or indirectly out of’ in the exclusion clause, made it very wide. Andrea’s claim could be excluded if a PEMC was anywhere in the chain of events or circumstances that led to her having to cancel the trip.

We sought Andrea’s medical records. It was clear Andrea’s dry mouth condition was a circumstance in the chain of events leading to her claim. Andrea had the dry mouth condition, she was then referred to a specialist about the issue, the specialist suggested she change medications, and then Andrea reacted adversely to the medication change.

Andrea argued that the reason her medication changed was not only because of the dry mouth condition but also because of her diagnosis with another condition (that diagnosis also occurring after activation of the cover). Unfortunately for Andrea, the way the policy was written meant that if part of the reason for the change in medication was a PEMC, it did not matter that the other reason for changing the medication was another condition.

We were satisfied that Andrea’s dry mouth condition was a PEMC. Andrea had suffered from the condition for a few years, and in 2015 it worsened. Andrea had received medical advice about the condition in the months leading up to her booking the trip and activating the insurance cover. Specifically, she saw her GP in May 2015, and had seen specialists in July 2015 about the issue. Also, the issue was still under investigation when she activated the travel insurance.

We did not uphold the complaint because the insurer had correctly applied the policy wording to decline the claim.