An emotional flight
In November 2014 Tom and Susie were on holiday in America. The holiday had been planned for some time and was for two weeks on the American west coast. Tom and Susie had insurance with, Titan Travel (“Titan”).
Tom received a phone call with some very sad news that his elderly mother had passed away in London. Tom and Susie cancelled the pre-booked portion of their US holiday and arranged to travel to London to attend the funeral.
Tom and Susie attended the funeral and met family in London. While in London they notified Titan of the circumstances. Titan said that cover might not extend but it would be assessed when a formal claim was filed.
Tom and Susie were able to return to Los Angeles and catch their scheduled return flight to New Zealand. After returning to New Zealand, Tom and Susie put in a claim for their return flights from Los Angeles to London. Mr and Mrs Thompson believed this travel was covered as they understood they could travel to attend a family funeral.
Titan declined Tom and Susie’s claim relying on a term in the policy that said “we will reimburse the reasonable additional costs of your return to New Zealand”.
Tom and Susie did not believe that the clause should be read so narrowly as to apply only to return to New Zealand. Tom and Susie said that their return flights to the UK would have been cheaper than return flights for two to New Zealand and they should be paid.
Titan said the policy’s purpose was to allow people to return to New Zealand in the event of an unexpected death or illness of a relative.
Titan reasoned that if a person was not on holiday when the circumstances occurred and the funeral was held in New Zealand, they would usually be able to attend. If the insured was on holiday and the circumstances occurred, they would have to return to New Zealand and this is what the policy allows people to do.
Titan said the policy did not allow the insured to travel overseas to attend family funerals. Titan reasoned that if the insured had not been on holiday during this time the insured would have had to organise their own travel arrangements to travel to attend the funeral overseas. Titan concluded it was not liable for Tom and Susie’s expenses.
We investigated and found:
- The policy clearly stated Titan would pay the costs “of your return to New Zealand”
- Giving the phrase its ordinary meaning in the circumstances, Tom and Susie did not satisfy the insuring clause
- Tom and Susie had the opportunity to read and understand the policy wording before their travel
- Tom and Susie’s claim would otherwise be excluded as Tom’s mother was over 85 was clearly excluded in the policy.
We found that Titan had reasonably applied the terms of its policy in declining Tom and Susie’s claim. We looked into whether Titan should have taken further steps to draw to Tom and Susie‘s attention the wording of the policy.
We found that a party to a contract seeking to enforce a particularly onerous or unusual term should fairly have brought that term to the attention of the other party. Providing the insured with a copy of the policy wording is sufficient unless the term is “extremely wide or unusual” in which case further steps should be taken by the insurer. We did not consider the phrase in question in this case to be extremely wide or unusual.
We explained to Tom and Susie the effect of the over 85 exclusion clause and they agreed their claim would be declined.
The wording of your insurance policy is carefully drafted to cover specific events and should be read carefully.
Phrases such as “return to New Zealand” will be given their ordinary meaning and read strictly by your insurer. You should comply with these phrases as closely as you can.
If you do not understand how a clause in your policy operates or what it means you should seek clarification from your insurer before travelling.