A traveller who left Australia on a one-way flight, caught COVID and was unable to return home has lost a claim dispute with Zurich on the basis the coronavirus was not an unforeseeable event when he departed in September last year.

He purchased the one-month policy in August last year, with a travel start date the following month, and was unable to return due to government travel restrictions and the high cost of flights because of the pandemic.

In June this year, he sought to claim for medical and extra accommodation expenses due to suffering from COVID, and for a theft of property on June 7, saying he was ill and in financial hardship and stuck overseas due to the coronavirus.

The Australian Financial Complaints Authority (AFCA) said medical and extra accommodation expenses clocked up due to suffering from COVID were incurred after June 2021 and this was after the period of insurance and therefore not covered by the policy.

Zurich was entitled to deny the claim, it ruled.

“The policy was for a period of one month and the complainant did not contact the insurer to extend the policy until almost eight months later. Given the disproportionately long time since the policy expired I am not satisfied the complainant had any intention to extend the policy until after the loss occurred,” AFCA’s ombudsman said.

The policy contained a section titled ‘Free Extension Of Insurance’ stating that “Where your journey is necessarily extended due to an unforeseeable circumstance outside your control, your period of insurance will be extended until you are physically able to travel home by the quickest and most direct route. The period of insurance will not be extended for any other reason.”

This did not apply in this circumstance, Zurich said, because COVID was not an unforeseeable event when the complainant purchased the policy.

AFCA noted the World Health Organisation (WHO) declared the outbreak of Coronavirus a global health emergency in March 2020 and the Australian government imposed travel restrictions later that month.

“I accept it was not unforeseeable COVID-19 could interfere with the complainant’s travel including forcing him to extend it,” AFCA’s ombudsman said. “Therefore, the ‘Free Extension Of Insurance’ under the policy does not apply.”

Zurich grants a seven-day grace period to extend or renew policies after the expiry date but the claimant made no contact until June this year.

See the full ruling here.