Holidaymakers unfairly penalised by insurers for having a drink

23rd September 2014

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Holidaymakers who have accidents after having only one or two drinks are being unfairly accused of “alcoholism” by insurers seeking to reject their claims, the Financial Ombudsman Service has warned.

The service, which settles disputes between customers and financial services companies, says that the proportion of travel insurance complaints it is upholding in favour of consumers has risen from 42 per cent to 53 per cent over recent years.

Caroline Wayman, the chief ombudsman, says: “We’re often asked to step in when an insurer is insisting that someone had been drinking alcohol before having an accident – and is refusing to pay out as a result.

“The majority of travel insurance policies exclude cover for events that happen after excessive alcohol consumption – but that doesn’t mean holidaymakers will only be covered if they don’t drink at all.”

Many people like to have a couple of glasses of wine or a cocktail on holiday, but sometimes even if you have not been drinking to excess and you are involved in an accident which would have happened regardless of whether you had had a drink, insurers may use this as a reason not to pay out.

Wayman adds: “In some cases, we find that terms describing alcohol consumption aren’t clearly defined in the policy – or have been unfairly applied by the insurer to reject a claim.

“For example, we see cases where insurers accuse their customers of ‘alcohol abuse’ or ‘alcoholism’, even though medical evidence shows they only had one or two drinks.”

The Ombudsman says that sometimes insurers jump to conclusions about what has happened because an accident has taken place on a particular resort or because of the claimant’s age .

In one case an insurer refused to pay out for medical expenses to a man in his twenties who collapsed at a resort popular with partygoers because of “intoxication” even though the level of alcohol in his blood was half the UK’s legal driving limit. The Ombudsman found in favour of the holidaymaker.

Wayman says that the onus is on the insurer to prove the reason for rejecting a claim is legitimate and that the Ombudsman will put more weight on medical evidence like blood tests, than one-off remarks by doctors.

Travel insurance complaints still only make up 2 per cent of the Ombudsman’s total workload.

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