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The wrong policy: just a click away

Kevin and Julie booked a holiday to Europe departing in September 2015. They activated travel insurance by purchasing prepaid travel expenses with a bank credit card. Although the bank supplies the policy, the insurance policy is underwritten by an insurance company. On 2 September, Kevin and Julie received news that Julie’s mother was unwell and her health was rapidly deteriorating.

Kevin and Julie were due to depart on the morning of 4 September. On 3 September they looked on the bank’s website for their insurance policy, so they could see what kind of cover they would have if they decided to cancel their flights in order to stay with Julie’s mother.

Unfortunately Kevin and Julie downloaded the wrong policy from the bank’s website – it was a policy with a different insurance company. Under this wrong policy, it looked like they would be covered for their cancelled flights.

Also, on 4 September Kevin and Julie rang the bank which transferred them to an operator from the insurance company. They told the operator that they could no longer fly because Julie’s mother was terminally ill and was only expected to live a few more days.

Julie’s mother passed away on 4 September, and Kevin and Julie cancelled their flights that day. Kevin and Julie rebooked flights to Europe and continued with their planned travel on 7 September.

Upon their return, Kevin and Julie made a claim to their insurance company for around $9,000 being the cost of their rebooked flights.


The claim is declined

Kevin and Julie’s claim was declined by the insurance company which said its policy provided for reimbursement of non-refundable travel expenses following cancellation due to the death of a relative, provided the relative is aged under 80 years. Julie’s mother was 87 years old.


The complaint

Kevin and Julie complained to FSCL that when they spoke to the insurance company operator, the operator led them to believe they would be covered if they cancelled and rebooked new flights.

Kevin and Julie said the operator should have enquired into Julie’s mother’s age, and pointed out the 80 year age restriction. They said that if the operator had pointed out the 80 year age restriction, they may have made other plans, and would not have incurred such a loss.


Our review

We found the policy wording was clear about the age restriction. It is up to the insured to read and understand a policy to ensure it will give them the kind of cover they seek before they agree to it. Furthermore, age restriction exclusions are fairly common in travel insurance policies.

We reviewed the phone call between Kevin and Julie and the insurance company telephone operator, and found that the operator did not give Kevin and Julie any advice about the insurance cover or whether a claim would be successful.

The operator stated they did not have any details about Kevin and Julie’s policy. The number Kevin and Julie called appeared to be for people who had returned from their travels and wanted to make a claim.

We found that although it would have been ideal for the insurance company to transfer Kevin and Julie to an operator who could assist with their enquiry, it did not follow that the insurance company could have been expected to review the policy wording, enquire about Julie’s mother’s age and then point out the exclusion. This would effectively be asking the insurance company to assess the merits of claims over the telephone.

In conclusion, we did not think the insurance company was liable for Kevin and Julie’s decision to rebook flights.


The website

As a result of our investigation we found that the inability to find the correct policy on the bank’s website was a significant contributing factor to Kevin and Julie believing they would be covered if they rebooked their flights.

Under the incorrect policy that they accidentally retrieved, it appeared their claim would have been covered.

We suggested that Kevin and Julie might like to make a complaint to the Banking Ombudsman about the accessibility of the travel insurance policy on their bank’s website.


Our Insight:

It pays to be scrupulous when considering travel insurance policies, especially in regards to exclusion clauses, before agreeing to one. It is reasonably common for travel insurance policies to have age relevant clauses which vary from policy to policy.