A travel insurer warns travel disrupted by fuel shortages falls into the same category as trips affected by war.
Southern Cross Travel Insurance (SCTI) says airlines, the New Zealand Government and other commentators have consistently been saying flight cancellations are being driven by the effect of the conflict in the Middle East impacting the supply and price of fuel.
“It is SCTI’s view that these business decisions are therefore covered by the general policy exclusion for war and violence,’’ says Laurence Hunter, chief underwriting officer for SCTI.
If an airline or operator makes a decision to cancel their services, customers should always speak with them first to understand what remedies are available to them, he says.
Airlines that have cancelled flights, including Air NZ and Jetstar here, have rebooked passengers or offered refunds, but without a quick resolution to the oil supply crisis global stocks of jet fuel could fall quickly.
All travel insurers have a general exclusion for cover relating to war and violence which means SCTI is unable to cover claims related to direct or indirect losses from the Middle East conflict, triggered by the US-Israel attack on Iran.
Claims relating to cancellation of flights and/or other elements of their journeys will be assessed on ‘a case-by case’ basis, with reference to the direct or indirect link between the claim and the exclusion for war.
. . . The Rules
That said, policyholders can still make claims for elements of a journey unconnected to war and violence.
SCTI says it can still provide medical cover, cover for their belongings or rental vehicle excess cover, depending on their policy benefits. “It is important to note that travel insurers, including SCTI, are unlikely to pay a claim made because a customer has changed their mind and no longer wishes to travel.”
Activating the war exclusion involves a number of indicators but primarily depends on a ‘do not travel’ advisory from the government.
In the case of the current conflict, SCTI determined that was from 0100, 01 Mar for New Zealand customers.
. . . Exclusions
A New Zealand Insurance Council spokesperson adds that travel insurance does not respond to every type of global disruption.
Where travel disruption such as airline cancellations, delays or re-routing arises from airline or travel providers’ operational decisions that are directly or indirectly linked to war or armed conflict, travel insurance policy exclusions are likely to apply.
This can include situations where fuel supply constraints or cost pressures linked to overseas conflict lead airlines to cancel or alter services, even if travellers are not travelling to the conflict zone itself.
