FSPO Highlights Travel Insurance Complaints: 656 Complaints Received From 2019 – 2021


  • Consumers to take the time to consider their travel insurance needs well before they depart on holiday this summer.

In advance of the summer holiday season, the Financial Services and Pensions Ombudsman (FSPO) is highlighting the types of complaints it receives regarding travel insurance, details of which are contained in the FSPO’s Digest of Decisions on travel insurance complaints. The Digest features a selection of 20 decisions which were issued following complaints regarding travel insurance made to the FSPO. The decisions, and the circumstances leading to the complaints, highlight important factors for consumers to consider before they go on holiday, including whether their policy will suit their needs and how certain claims were dealt with by insurances.

The Financial Services and Pensions Ombudsman (Acting), MaryRose McGovern, said:

At this time of year, many of us are making holiday plans and looking forward to a much-needed break. Many people will take out a travel insurance policy to provide some protection if things don’t go as hoped. With all financial products, it is so important to understand what you are buying and to be aware that not all insurance policies are the same. Some of the complaints we have received in the FSPO highlight that the consumer believed they had cover under their travel insurance policy for certain events or circumstances, only to discover that they did not, and their claim was refused. If you are making holiday plans for this year and thinking about taking out a travel insurance policy, I would urge you to take some time to ensure that any policy you decide to purchase, will provide the cover you expect.

We have published a Digest of Decisions, which features 20 decisions issued following complaints made to the FSPO regarding a travel insurance policy. Many of the complaints featured in the Digest concern circumstances where policy holders cancel their holiday arrangements due to medical issues. With travel insurance policies, it is very important to be aware that cancellations arising from medical conditions that existed before the policy was taken out, may not be covered. In addition, some people may not be aware of the potential impact of medical investigations, or even blood tests, that are not disclosed at the time the policy is purchased. These decisions highlight an important point, that if you have a medical condition, undiagnosed medical complaint or are undergoing medical investigations at the time you take out a travel insurance policy, you must inform your insurance so that it can determine whether it has any effect on your policy cover.

The decisions in this Digest highlight the difficult circumstances leading to the complaints made to this Office. Matters concerning illness, cancellation of much-anticipated holiday plans and thefts while abroad are difficult events for the people concerned. Crucially, many of these decisions highlight circumstances where the complainant canceled their holiday. In order to ensure that you have cover for cancellation in certain circumstances, you should take out your policy as soon as you book your holiday. Buying insurance just before you go may give you cover for events and circumstances while abroad, but may not provide you with any protection if you need to cancel your holiday plans.

The Digest highlights the wide range of issues giving rise to complaints concerning travel insurance and the difficult circumstances leading to those complaints. Some examples of complaint outcomes in the decisions published include:

  • A direction by the Ombudsman to pay the claim from a policy holder who missed his flight by 5 minutes as his rental car would not start when he went to leave for the airport. The insurance was of the view that the policy holder had failed to allow sufficient time to account for “possible delays”, but the policy wording did not refer to “possible delays” and instead referred to “delays which are expected”. The decision noted the significant difference between the two definitions and that there was no evidence that the delayed should have been expected.
  • A direction by the Ombudsman to pay a claim and make an additional compensatory payment of €500 to a couple whose rental vehicle in Spain was broken into and items were stolen from the boot. The travel insurance company declined the couple’s claim on the basis that their travel insurance policy did not provide cover for the loss, theft of, or damage to valuables left unattended at any time, including those left in a motor vehicle. The policy also contains a provision that baggage contained in an unattended vehicle would not be covered, unless in a locked boot. The wording of these opposing and conflicting exclusion clauses creates a confusing situation making it nearly impossible for a policyholder to understand whether or not they would be covered.
  • A direction by the Ombudsman to pay €600 in compensation to a policy holder whose backpack was stolen from an overhead locker in the cabin, during a flight. The policy holder’s claim was rejected on the grounds that her personal possessions were not kept “on her person” but there was no definition of “one’s person” in the policy itself. The decision noted that the clauses in the insurance company’s policy were potentially confusing and while there was no obligation to exhaustively set out all of the circumstances where a claim would be declined, a consumer may reasonably expect the most relevant circumstances to be included and explained.
  • A direction by the Ombudsman to pay a claim amounting to just over €600 to a policy holder whose flight was canceled due to an air traffic control strike in France. The policy holder booked an alternative flight home from France and his claim for the cost of the alternative flight was refused by the insurer on the basis that he had prior knowledge of the possible disruption of his travel plans, due to air traffic control agreements in France . The Ombudsman concluded that even if the policy holder had been aware of reports of disruptions, he would have had difficulty knowing whether or not his flight would be canceled on the date in question. The decision also noted that the insurance company’s submissions made reference to strike action being “announced” rather than “forecast”, as set out in the policy and that as neither word was defined in the policy, it was unclear how the insurer would establish if a strike has been “forecast”.

In addition to publishing Digests of Decisions, the FSPO’s Database of Decisions on www.fspo.ie has the full text of over 1,600 decisions and includes decisions issued up to the end of January 2022. By publishing binding decisions and Digests of Decisions, the The Ombudsman aims to enhance transparency and understanding of the powers and the services provided by the FSPO.

The full Database of Decisions can be accessed at https://www.fspo.ie/decisions/

Notes

  • In accordance with Section 10(1)(d) of the Financial Services and Pensions Ombudsman Act 2017 (the Act), Ms. MaryRose McGovern was appointed Financial Services and Pensions Ombudsman (Acting), by the Minister for Finance, with effect from 6 February 2022 until such time as the appointment of an Ombudsman is made, under Section 8(1) of the Act, and for not more than 12 months.
  • When the FSPO issues a legal binding decision, that decision is subject to a potential law appeal to the High Court within 35 calendar days from that date.
  • The FSPO does not publish decisions before the elapse of the 35-day period available to the parties to make a statutory appeal to the High Court.
  • Decisions which have been appealed to the High Court are not published, pending the outcome of any such Court proceedings.
  • The FSPO publishes a list of active law appeals on its website.
  • Before any legally binding decision is published by the FSPO it undertakes a strict and stringent review to ensure that the non-identification requirements of the Act are adhered to in order to protect the confidentiality of the parties.
  • The FSPO deals with complaints informally at first, by listening to both parties and engaging with them to facilitate a resolution that is acceptable to both. Informal mediation allows a faster resolution. When these early interventions do not resolve the dispute, the FSPO investigates the complaint and subsequently issues a decision that is legally binding on both parties, subject only to an appeal to the High Court.
  • The Ombudsman can direct a financial service provider to pay compensation of up to €500,000 to a complainant and/or to rectify the conduct that is the subject of the complaint. There is no limit on the value of the rectification that can be directed.
  • Decisions issued by the Financial Services and Pensions Ombudsman are legally binding on both parties and can only be appealed to the High Court. Decisions are available at www.fspo.ie/decisions

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