In January 2015, Rewi and Anne booked a 3-week trip to Australia for October 2015 and purchased travel insurance. In May 2015, Rewi and Anne cancelled their trip because a dispute with their neighbour, (which had been ongoing since 2006, and with lawyers involved) had escalated. The dispute with the neighbour had become so bad in May 2015, the neighbour blocked Rewi and Anne’s access to their property.
Why did Rewi and Anne cancel their trip?
Rewi and Anne cancelled their trip because they thought they may be forced into taking court action if their neighbour’s behaviour continued, or defending court action their neighbour might take. Rewi and Anne wanted to save money for potential legal fees.
Rewi and Anne also felt they could not be outside the country for 3 weeks in the event they received a court summons. In addition, Rewi and Anne thought their neighbour might damage their property if they were away from home for that long (which he had done before).
Although the dispute with the neighbour had settled down in early 2015, when the neighbour blocked the access way, the dispute became so overwhelming that Rewi and Anne felt they could not travel.
The claim
Rewi and Anne made a claim to their insurer for the cancellation costs of $4,500. The insurer declined the claim because it considered the cancellation of the trip was not unexpected, unintended, or outside Rewi and Anne’s control. In addition, the insurer said its policy excluded cover where the claim arises from business, financial or contractual obligations.
Rewi and Anne considered it was outside their control that their neighbour was behaving so badly towards them, and that they may have to appear in court. Ultimately, Rewi and Anne said it was outside their control that they had to cancel their trip. Rewi and Anne complained to FSCL.
Review
We agreed Rewi and Anne never expected or intended their neighbour would block the access way to their home in May 2015. It was likely that if that had not occurred, and the Rewi and Anne’s relationship with their neighbour had remained reasonably amicable, Rewi and Anne s would still have travelled to Australia.
It appeared the neighbour blocking the access way was the ‘final straw’ for Rewi and Anne, and their primary focus became the dispute with their neighbour. It appeared that the stress of the situation became overwhelming and they simply could not see themselves being in the right frame of mind to travel in October 2015.
We could understand Rewi and Anne felt they had no option but to cancel their trip. However, ultimately, the decision to cancel the trip was a decision within Rewi and Anne’s control. Also, although stressful, the neighbour’s action in blocking the access way in May 2015, did not actually prevent Rewi and Anne from travelling in October 2015.
Unfortunately, Rewi and Anne did not understand that even if their neighbour took court action, there would likely have been the option of a court date adjournment. It was also unfortunate Rewi and Anne did not contact the insurer prior to cancelling the trip, because the insurer may have been able to advise that cancellation costs would not be covered.
We could also understand Rewi and Anne were anxious about going on the trip because they thought their neighbour may damage their home, but travel insurance does not cover the costs of repairing damage to a home. Recovering these costs would usually be by way of a claim under a standard home and contents insurance policy, or by laying a complaint with the police.
Also, Rewi and Anne cancelled their trip because they wanted to recoup the money they had spent on their trip, to put towards possible legal fees. However, travel insurance does not cover situations where people feel they can no longer afford to travel.
Although disappointed, Rewi and Anne decided to discontinue their complaint.
Our insight
As with any type of insurance, travel insurance policies will set out what the insurer is prepared to cover, and what it is not prepared to cover. It is important for consumers to be aware of what their policy covers them for, by reading the policy. Although we could understand why Rewi and Anne decided not to travel, the circumstances of their claim meant that travel insurance would not provide cover for their loss.
