Many people buy travel insurance to give them the peace of mind that if they get sick or injured whilst travelling, are covered. The costs which they are covered might include the cost of medical treatment in a foreign country, the costs of being medically evacuated back to Australia for treatment or the out-of-pocket costs of cancelling your trip.
However, many people do not know that some of the things that they love to do while on holiday are not covered under their travel insurance policy exclusion clauses. In other words, some travel insurers may refuse to pay for treatment or other costs incurred due to illnesses or injuries caused by alcohol consumption (even indirectly) or which involve activities which are excluded under the policy because they are dangerous.
The following is a summary of some of the more commonly relied upon travel insurance exclusions.
Alcohol consumption may void your travel insurance
Many people enjoy a drink whilst on holiday. However, many people do not know that most travel insurance policies include some kind of restriction on claims related to alcohol consumption.
The exclusion clauses vary between policies. One leading travel insurer excludes claims “arising or related to your impairment due to you drinking too much”. Drinking too much (in this particular policy) is defined as having a blood test which reveals a blood alcohol concentration of more than 0.19%.
Whilst this is a relatively high blood alcohol concentration reading, it’s not impossible to imagine how a few extra drinks consumed on holidays may lead to a higher than usual level of intoxication.
Also, it’s important to understand that your impairment need not be the sole or even major cause of your claim (as would be the case if you were to drive a car or motorbike whilst intoxicated), but need only arise from or relate to drinking. Therefore, if you have been in a bar or had more to drink than usual whilst on holiday, and you were to cross the road and trip and fall and become injured, your insurer may refuse to pay for your medical treatment, medical evacuation or other expenses.
It's important to note that the example from a leading travel insurer is just one example of an alcohol-related exclusion. Other policies can be even harsher.
For example, we once assisted a young guy that was on holiday and fell from a balcony after having around 4 drinks. Before he fell, he was sitting on the balcony railing drinking and chatting with mates. His insurance company initially refused his claim for treatment on the basis that his injuries were caused by or contributed to by the consumption of alcohol (as was set out in the relevant policy). We successfully argued that his blood alcohol level (which was around 0.08) was not such that alcohol caused or contributed to his illness by obtaining expert medical opinions to support that position.
Illicit substances can lead to a rejected travel insurance claim
Most travel insurance policies will have restrictions on claims related to consuming illegal or non-prescription drugs.
One leading travel insurer excludes claims “which in any way relate to your… ingestion of any non-prescription drug or substance (eg marijuana, ecstasy, heroin)”. The preamble “in any way relate” is somewhat ambiguous, and as with the alcohol exclusion set out above, a person that consumes a non-prescription drug and falls and is injured in an innocuous way that is not obviously caused by the non-prescription drug could result in the rejection of their travel insurance claim.
Also, it would be interesting to see this insurer’s attitude (and that of others) to a claim related to the ingestion of marijuana in a state/country that has legalised marijuana. On the one hand, claims related to marijuana ingestion are obviously excluded under clauses like that above. However, when ingested in a setting that is legal, marijuana (in theory) should not be treated any differently to claims related to alcohol consumption.
Therefore, provided that the marijuana ingestion is not excessive, we think that there would be a strong argument to challenge an exclusion on the basis that marijuana is not a non-prescription (or illegal) drug in the particular destination.
Dangerous activities exclusions in travel insurance
Most insurance policies will have automatic exclusions for claims involving participation by the insured person in dangerous or hazardous activities. What is considered a dangerous activity varies between policies.
Obviously, risky activities like BASE jumping, hang gliding and skydiving are often excluded. So too are some other dangerous activities which people may expect to be covered, like running with the bulls, participating in rodeos and motor-cross riding. Other sometimes excluded activities, that people don’t always understand will be excluded because they are common holiday activities, are scuba diving, hunting, riding scooters, skiing and/or snowboarding.
Importantly, whilst most policies include a number of automatic exclusions for dangerous activities, cover for some excluded activities can be covered if disclosed to the insurer, and cover is specifically requested at the time that the policy is purchased.
COVID-19 and travel insurance
Most travel insurance companies include some restrictions on claims related to COVID-19.
The extent of the exclusion varies between policies and might only exclude claims related to cancelled travel plans due to catching COVID-19 or may extend to exclude claims for medical treatment necessary due to catching COVID-19 or exclusions on claims related to Government mandates and lockdowns due to COVID 19 outbreaks.
Because there is so much variability between policies, it's important to check the particular policy terms when you purchase your travel insurance.
Get help from a travel insurance lawyer
Many people get caught out by exclusions on travel insurance policies, particularly exclusions relating to alcohol consumption. Therefore, it’s important to be mindful of the exclusions.
If you’ve lodged a claim for travel insurance and it’s been rejected due to an exclusion clause, you should seek legal advice early. Do not always immediately accept the initial decision of the insurance company.
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