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Travel insurers can skip cover for skipping hearts

Harriet embarks on a yearlong exchange

Karen’s daughter, Harriet, was going on a year’s exchange to the United Kingdom. Karen purchased travel insurance for Harriet with VEZ Insurance (“VEZ”) for the travel period 5 January 2015 to 21 December 2015.

In November 2014 Harriet had an unexpected cardiac arrest and had an implantable cardioverter defibrillator (ICD) implanted. Karen notified VEZ of this new medical event. VEZ placed a restriction on Harriet’s policy, meaning that Harriet would not be covered for medical events that related to her heart condition.

Harriet was cleared to travel by her cardiologist and left for the United Kingdom as planned. Karen contacted FSCL to review VEZ’s decision to restrict Harriet’s insurance cover.  


Karen’s view

Karen wanted VEZ to reinstate Harriet’s full cover. Karen believed that VEZ acted unreasonably in restricting Harriet’s cover because the policy had been paid for in full prior to Harriet suffering the cardiac arrest.


VEZ’s view

VEZ said that its policy gave it the ability to apply special conditions when a medical event was disclosed prior to travel. VEZ said that Harriet would be covered under the insurance policy for any non-medical related events (for example, lost luggage), and any medical events not related to Harriet’s heart condition. VEZ also said that it would have covered Harriet up to the amount of any non-refundable cancellation costs she would have incurred had she cancelled her trip after suffering the cardiac arrest.


FSCL’s view

We found that VEZ acted reasonably by imposing restrictions on Harriet’s insurance cover.

A heart condition is a very serious condition. Fortunately Harriet had not suffered any further heart-related events. However, if Harriet did suffer a heart-related event, the results could be very costly while she was overseas. Upon disclosure of information from an insured, an insurance company is entitled to determine what risks it will or will not continue to cover.

Under the policy VEZ was entitled to restrict cover when a new medical event was disclosed, prior to travel, by imposing special terms and conditions. This meant that the policy gave VEZ absolute discretion to impose conditions as it saw fit. The decision to restrict cover for heart-related events was a decision made by VEZ’s underwriters which was based on an assessment of the risk of a further event occurring for which Harriet may make a claim.

In our view, VEZ was entitled to decide not to cover Harriet in full for any losses as a result of a heart related event. We recommended that Karen discontinued her complaint.