A woman who cancelled a planned trip to attend her brother’s wedding in Rio de Janeiro when she became pregnant and was medically advised not to go due to health risks from the Zika virus has lost a claim dispute with QBE.

She held an annual multi-trip travel insurance policy and booked the trip to Rio in March 2019, intending to depart with her family the following September.

In June 2019, she cancelled the trip on discovering she was pregnant and advice from a doctor against making the journey due to the presence of the Zika virus in Brazil, which can be passed from mother to child during pregnancy and lead to miscarriage, stillbirth and a brain defect called microcephaly.

QBE said the cause of the cancellation was not an insured event and declined her claim to cover the $4046 cost of the cancelled flights.

The Australian Financial Complaints Authority (AFCA) determined in favour of the insurer, saying risks associated with pregnancy at the destination were not a covered reason to recoup costs.

“I cannot agree the policy intends to cover cancellation due to health risks associated with a particular location and I do not agree the policy terms consider becoming pregnant as a covered reason for cancellation,” AFCA’s ombudsman said.

To be covered for cancellation costs caused by medical reasons, the policyholder needed to be suffering from an illness or injury at the time of the cancellation, AFCA said.

“This is separate and distinct to being unfit to travel due to concerns with a disease prevalent in the location of the intended travel, and risks associated with that disease.”

A medical certificate completed by a doctor stated “10 weeks pregnant, unable to travel to Brazil due to Zika virus” while the Australian Department of Health’s advice was that pregnant women should defer non-essential travel to areas affected by the virus.

“While this advice relates to the prevention of a serious illness in a specific location, it does not establish the complainant was suffering from an illness at the time of the cancellation,” AFCA said.

The QBE policy provided cover if the arrangements were cancelled because of 17 covered reasons. None covered reasons related directly to cancellation due to becoming pregnant.

AFCA said the covered reason most relevant referred to being unable to start a trip due to sudden serious illness or injury. The policy defined those terms as "any disease or sickness affecting the body or mind" and "a bodily injury that is caused solely and directly by external and visible means as a result of an accident and which does not result from an illness or disease".

“I do not agree the policy intent was to consider pregnancy as either of these things,” the AFCA ombudsman said.

The woman argued her circumstances fell within the definition of a pregnancy complication, which was covered under the policy wording, which was defined as "any secondary diagnosis occurring prior to, during the course of, concurrent with, as a result of or related to the pregnancy, which may adversely affect the pregnancy outcome or your ability to travel”.

AFCA said this did “not mean the complainant has unconditional cover for everything associated with a pregnancy”, and she must still be able to establish the cause of the cancellation was one of the covered events, such as an illness or injury.

She had not been diagnosed with any condition or complication relating to the pregnancy, it said, and had instead been warned about the risks of such conditions or complications if she travelled to Brazil.

“The complainant was not unable to travel due to the pregnancy, she was unable to travel to the intended destination due to health concerns with that particular location,” AFCA said.

“I understand the complainant was taking positive action to prevent the risk of a condition, injury or illness if she travelled to Brazil. I also accept this action was reasonable and required in the circumstances. However, the insurer is entitled to rely on the terms of the policy.”

See the full ruling here.