Medical foresight: Travel insurance won’t cover medical costs incurred in New Zealand

Graeme experiences eye problems while on holiday

On 30 November 2013 Graeme and Christine flew to Singapore. While Graeme was in Singapore he found that the sight in his left eye was deteriorating. When Graeme arrived in India he went to see a specialist who advised him that he needed an immediate operation for a detached retina.


On 12 December 2013 Graeme had an operation on his eye and was told he could not fly for some time because he had an air bubble in his eye. Graeme was given clearance by his doctor in India to fly back to New Zealand on 10 February 2014.


Graeme’s travel insurance with TRI Insurance (“TRI”) covered the full costs of his surgery and follow up treatment in India. TRI also covered the cancellation costs and the additional accommodation and living expenses Graeme incurred while awaiting confirmation that he was fit to fly home to New Zealand.


On 5 June 2014 Graeme attended an appointment with a New Zealand specialist to find out whether the sight in his left eye could be restored back to a normal level. The specialist told Graeme that he would need to have a second surgery to correct his vision and that this was a direct consequence of the treatment he had received in India.


TRI told Graeme that medical costs incurred in New Zealand were not covered under TRI’s insurance policy.


Graeme’s view

Graeme argued that TRI should pay for the second surgery because the requirement of this surgery was a direct result of the surgery and treatment he received while travelling in India.


Graeme said that at the time of his first surgery in India he told TRI that he may need to have a second surgery. Graeme argued that had TRI told him that it would decline cover for further medical treatment on his eye when he returned to New Zealand, he would have stayed overseas because it is cheaper to get operations performed overseas.


TRI’s view

TRI believed that the policy did not provide cover in the circumstances of Graeme’s claim. TRI said its policy clearly stated that TRI would not pay for medical costs once an insured has returned to New Zealand and/or for medical costs incurred in New Zealand.


TRI also said that under the policy TRI had the ability to repatriate an insured to New Zealand for medical treatment. Once Graeme was fit to fly, TRI would have flown him back to New Zealand and any further medical treatment required in New Zealand would not be covered by TRI.  


FSCL’s view

We agreed that it was clear from the medical evidence that the second surgery Graeme required was a direct result of his retina detaching and the medical treatment he received while overseas. However, we also agreed that the insurance policy clearly stated that any medical expenses incurred by Graeme after he returned to New Zealand would not be covered.


From a telephone recording between TRI and Graeme’s wife, Christine, it was clear that TRI advised Christine that there was no cover for medical expenses incurred in New Zealand. Also, there was no evidence that while Graeme was in India he informed TRI that he may require a second surgery. It appeared that it was only in June 2014 that Graeme was advised by a New Zealand specialist that he required a second surgery.


We found that TRI had the unilateral right to repatriate an insured back to New Zealand for medical treatment once the insured was fit to fly. This meant that even if Graeme told TRI while he was in India that a second surgery was required, under the policy once he was fit to fly, TRI was entitled to return Graeme to New Zealand. If Graeme chose not to abide by TRI’s decision, the policy would have given TRI the right to only pay the costs it would have paid had Graeme returned. In this instance, $0 as medical expenses in New Zealand are not covered.


We recommended that Graeme discontinue his complaint.