The Australian Financial Complaints Authority (AFCA) has ruled Zurich did not act unethically when it declined a travel claim from a couple who cancelled a trip after the female partner became pregnant.

The couple bought the policy in October 2018, months before their trip the following year that would have seen them visit a few countries with a high risk of contracting the Zika virus.

A month before their trip in April last year the pregnancy was confirmed, and the couple subsequently made the decision not to travel as planned, based on medical advice.

They then lodged a claim for travel expenses incurred as a result of the cancellation, but Zurich declined it on the basis that the loss was excluded from cover as defined by the policy terms.

In their submission to AFCA, the couple says Zurich failed in its duty of care to provide an “ethical level of cover”.

They also said that before deciding to cancel the trip they contacted Zurich and were advised the policy they took out covered for pregnancy. Their travel agent also offered the same advice. However, the couple acknowledged they were unable to provide the evidence to support their submissions.

In its ruling, AFCA says it decided the dispute based on the merits of the claim, since no evidence could be presented to suggest the insurer misled the complainants.

“The female complainant was not pregnant at the relevant time,” AFCA says. “Therefore, at the relevant time, it was unforeseeable that the complainants would cancel their journey.

“I accept that as expectant parents, the complainants were entitled to make this decision and felt they were acting in the best interest of their unborn child. Unfortunately, however, that is not the test and the policy does not respond in these circumstances.

“I do not agree that the insurer has acted unethically in excluding claims for pregnancy from cover. This determination is in favour of the insurer.”

The full decision can be seen here.