The situation began when the policyholder purchased travel insurance for a family holiday scheduled to begin on December 12, 2023. Shortly after arriving in the U.S., the man was informed of his sister-in-law's critical health decline due to metastatic colorectal cancer. He returned home to be with her in her final days, later resuming his vacation on December 23.
However, upon claiming for the abrupt change in travel plans, the insurer, AWP Australia, denied the claim. They stated that the policy explicitly excluded coverage for incidents related to pre-existing medical conditions of the insured’s relatives. The sister-in-law’s diagnosis of cancer and a pulmonary embolism had been established for nearly a year prior to the start of the policy coverage.
The case highlights a common oversight among travelers: not accounting for family members' significant medical histories while planning their travels. Even though the policy allowed for early return and resumption of journey benefits, these did not apply as the sister-in-law's health condition predated the travel insurance policy.
The policyholder argued that the policy had not explicitly required him to disclose his sister-in-law’s medical background, which he felt was unfair. He also mentioned experiencing substantial financial hardship due to the rejection of his claim. Nevertheless, AFCA supported the insurer's decision.
In summarizing the decision, the AFCA ombudsman stated, “I acknowledge the complainant was not aware that [his sister-in-law] may fall seriously ill and pass away when he commenced his holiday. However, I am satisfied the exchanged information shows death was caused by her pre-existing medical conditions for the purposes of the policy. In the absence of any other information, I am satisfied the insurer is entitled to deny the claim.”
This resolution accentuates the criticality of reading and comprehending the exclusions present in travel insurance policies. Policyholders should be fully aware of what constitutes a pre-existing condition and how it may impact claim eligibility. The case serves as a cautionary tale for travellers to ensure all potential scenarios are accounted for in their insurance coverage. For further details, you can refer to the ruling as noted by Australian Financial Complaints Authority.
Published:Wednesday, 22nd Jan 2025
Source: Paige Estritori
| Allianz Australia Penalised for Misleading Travel Insurance Information 24 Feb 2026: Paige Estritori In a significant ruling, the Supreme Court of New South Wales has imposed fines totaling $16.8 million on Allianz Australia Insurance and its subsidiary, AWP Australia, for disseminating misleading information about their travel insurance products between 2016 and 2018. This decision underscores the critical importance of transparency and accuracy in the insurance sector. - read more |
| Survey Highlights Alarming Number of Australians Travelling Uninsured 24 Feb 2026: Paige Estritori Recent research conducted by the Insurance Council of Australia (ICA) and the Department of Foreign Affairs and Trade (DFAT) has unveiled a concerning trend: approximately 14% of Australian travelers embark on international journeys without any form of travel insurance. This statistic has prompted industry leaders to urge Australians to reconsider the importance of securing adequate coverage before traveling abroad. - read more |
| Surge in Medical Claims Among Australian Travellers Highlights Importance of Comprehensive Insurance 24 Feb 2026: Paige Estritori In 2024, medical incidents emerged as the leading cause of travel insurance claims among Australian travelers, accounting for more than 40% of all claims handled by nib Travel. This trend underscores the critical importance of securing comprehensive travel insurance to mitigate the financial risks associated with medical emergencies abroad. - read more |
| Australian Homeowners Confront Steep Rise in Insurance Premiums 24 Feb 2026: Paige Estritori Over the past five years, Australian homeowners have experienced a significant 51% increase in home insurance premiums. This surge has placed a considerable financial burden on property owners nationwide, with Darwin residents facing the highest costs. - read more |
| Why Every Tradie Needs Tailored Insurance: Protecting Your Livelihood In Australia, tradies are the backbone of many local communities, providing essential services in fields such as construction, plumbing, electrical work, and more. These skilled professionals often operate their own businesses or work as contractors, making financial stability paramount. - read more
|
| Tackling Unexpected Illness: How Income Insurance Can Help Maintain Your Standard of Living Illness limps in unannounced, derailing both physical health and financial stability without warning. When you're sideswiped by unexpected medical conditions, the uncertainty can compound, leading to a precarious balance of meeting health needs and financial commitments. Many are left pondering how to maintain their lifestyle amidst this turmoil. - read more
|
| The Essential Role of Income Insurance in Your Financial Plan An income insurance policy, often referred to as income protection insurance, is a financial safety net designed to provide you with a steady income stream if you're unable to work due to illness or injury. It ensures that you can still support yourself and your family, even when unforeseen medical conditions prevent you from earning a salary. This policy typically covers a percentage of your pre-tax income, helping to alleviate the financial burden during recovery periods. - read more
|
| A Comprehensive Guide to Income Protection Insurance in Australia Income protection insurance is a type of insurance policy that provides financial support if you're unable to work due to illness or injury. It offers a replacement income, usually up to 75% of your normal wage, helping you maintain some level of income during tough times. - read more
|