Travel insurance ombudsman

Travel insurance provides crucial financial protection against an extensive range of holiday risks. While 90% of travel insurance claims are paid, if your holiday mishap falls into the 10% that aren’t and you believe your insurance company unfairly rejected your claim, there is still something you can do about it.

As of 1 November 2018, you can direct your complaints to the Australian Financial Complaints Authority (previously the Financial Ombudsman Service).

What is the Australian Financial Complaints Authority (AFCA)?

Helping consumers with a range of complaints from credit cards to superannuation to insurance, the Australian Financial Complaints Authority can help with disputes over travel and ticket insurance.

Can I still make complaints to the Financial Ombudsman Service (FOS)?

In short, no, you can’t. Any complaint made prior to 1 November, 2018 that isn’t resolved has been passed to AFCA as well.

When would I use the services of AFCA?

If your travel insurance claim falls within that 10% that are rejected and you believe it’s unjustified, you can reach out to AFCA to try and settle your dispute. You have six years from the point you became aware of the issue to file your dispute, or within two years if you’ve already filed a complaint with the insurance company.

Some common complaints AFCA receives about insurance include the following:

• You’re unable to prove loss or damage to goods that were yours
• Denial of your claim based on non-disclosure of pre-existing conditions
• You’re accused of making a false or fraudulent claim

AFCA covers the following:

• Travel insurance: Lost luggage, illness, theft when travelling that causes a disruption in your plans
• Ticket insurance: If you’re unable to attend an event because of an unexpected circumstance (i.e. you fall sick or are in an accident on the way to a concert or sporting event)

What to do if your travel insurance claim is denied by your provider

If your feel your travel insurance claim was unfairly denied, here’s what you need to do:

1. Find out why. Contact the insurer to request as much information as possible about the reasons why your claim was refused.
2. Lodge a complaint through the internal dispute resolution (IDR) process with the insurer.
3. Review the insurer’s response. See how your insurer responds to the complaint and review the reasons it provides for its decision.
4. Lodge a dispute with AFCA. If the matter hasn’t been resolved, you can lodge a dispute within two years of getting the IDR or within six years of becoming aware of the issue.

How does the Australian Financial Complaints Authority work to resolve disputes?

Once a complaint is received and lodged, AFCA works as a mediator between you and the insurance company to try and reach a settlement through negotiation or conciliation.

If you have already filed an internal dispute resolution (IDR) with the insurance company, AFCA estimates it will take up to 21 days to sort the dispute. It can take up to 45 days if you haven’t filed an IDR.

So long as the complaint fits within AFCA’s rules, your complaint will be moved into case management. Depending on the complexity of the case and how much additional information is requested, you should hopefully reach a settlement within four to eight weeks.

A final decision is made by an adjudicator, ombudsman or panel.

What can AFCA do to resolve my travel insurance dispute?

There are a few methods AFCA uses to try and settle claims:

• Negotiation. AFCA will work as a middleman between you and the insurance company to try and negotiate a settlement that works for both parties.
• Conciliation. AFCA will organise and facilitate an informal telephone conference with both parties to hear each other out. If no settlement is reached at the end of the discussion, AFCA will make a decision.
• Assessments. AFCA will conduct an assessment of the complaint and the issues raised. It will then recommend a resolution to the complaint and give both parties 7-30 days (depending on the type of complaint) to settle.
• Determination/Decision. The AFCA Decision Maker comes up with a decision about the complaint in writing and may recommend monetary or some other type of compensation. You are free to accept or reject this decision.

Are there any disputes AFCA can’t help with?

AFCA can’t help if your complaint falls within the following:

• If you’ve already filed a dispute with AFCA and have no new information or evidence to back up your claim
• If you have taken your dispute to court, tribunal by legislation or a predecessor scheme
• If your complaint falls outside of AFCA’s rules

You can also get free legal service and get advice on insurance law from the Insurance Law Service, which can assist you with information about travel insurance.

How can I contact the Australian Financial Complaints Authority?

If you’ve unsuccessfully complained to your travel insurance provider, you can lodge a dispute online. There’s also a live chat service available on the AFCA website for assistance from 9am-5pm AEST Monday to Friday.

Travel insurance ombudsman FAQs

• Can I contact AFCA before I have lodged a complaint to my insurer?

  • Your first step should be to contact the insurer to submit your complaint. If the matter is not resolved to your satisfaction by the end of the insurer’s internal dispute resolution process, you can contact AFCA.

• How do I lodge a complaint with my travel insurer?

  • Each insurance brand works differently, so it’s best to check directly with your provider for information about complaints. Their customer support team should be able to assist you with the best way to file a complaint.

• How do I know whether an insurance provider is a member of AFCA?

  • There’s no search function currently available on the AFCA website, but most insurance brands should list whether they are a member on their website. If you can’t find this information, it’s best to contact the insurance provider directly to ask or you can try AFCA’s online chat service.

• How can I find out what is and isn’t covered by my travel insurance policy?

  • This information is contained in your travel insurance PDS. You can also find a more general guide to the benefits and exclusions of travel insurance in our comprehensive guide.