QBE will appeal against a court-imposed $5000 fine after losing a case in the Federal Magistrates’ Court brought by a woman with a terminal cancer condition. MD Raymond Jones says the verdict over QBE’s decision to decline travel insurance for the woman could provoke other insurers to withdraw from the travel insurance market.

Adelaide woman Denice Bassanelli, 31, won a trip to Japan through a radio competition. While she accepted that her pre-existing breast cancer condition may prevent her claiming for medical costs, she objected to being refused any form of travel insurance at all.

But Mr Jones told Sunrise Exchange News QBE made the right decision and that the legal judgement could have “disastrous implications” for future cases like this.

Ms Bassanelli first took her case to the Human Rights and Equal Opportunity Commission, which ruled in favour of QBE. She appealed to the Federal Magistrates’ Court, which ruled that QBE acted unlawfully. It ordered the company to submit a formal apology, pay $5000 in damages and pay Ms Bassanelli’s legal costs.

Magistrate Kenneth Raphael said he was satisfied “that providing this service would not have required the respondent to provide a service in a situation of unjustifiable hardship”.

“The reasons given for not issuing a policy, which excluded all medical events, were such that a policy would be uneconomic and was not a standard form policy for QBE,” he said. “However, the evidence is that ... (QBE) has in the past issued such policies.”

But Mr Jones says that while feeling “extremely sorry” for Ms Bassanelli, the decision was “fundamentally wrong” and has the ability to set a disturbing precedent.

“We couldn’t provide the cover because although she wasn’t after travel insurance for the cancer directly, the causation effects of cancer of that level are too risky,” he said. “Japan also has a very expensive medical system, and that was just one of many aspects we had to take into account when formulating our decision.”

QBE will appeal the decision as soon as possible, he said. “If you want companies to be able to provide travel insurance to deserving people who are in a position where they are at risk through unknown events and certainly unknown medical conditions, then this decision has to be overturned.”