Unexpected incidents may occur during a journey, and many consumers have developed the habit of purchasing travel insurance before departure. However, with the vast variety of travel insurance products available on the market, consumers may not fully grasp or understand the differences in coverage and policy details. The Consumer Council has received complaints regarding disputes over travel insurance claims from time to time, such as a road trip delayed by a snowstorm not being covered, compensation claims for flight cancellation affected by ticket purchase dates, and delayed arrival of checked baggage upon return to Hong Kong not being compensated. These cases reflect discrepancies in the understanding of coverage between consumers and insurance companies under different circumstances. Moreover, baggage delay coverage may only apply to destinations outside Hong Kong. Such restrictive clauses may affect the scope of coverage, but may be overlooked by consumers. The Council recommends the industry to enhance transparency in policy terms and improve the design of sales interfaces to highlight critical information, including coverage scope, definitions of terms, and exclusions, enabling consumers to better comprehend important details. This would safeguard consumer rights, reduce disputes, build consumer confidence, and improve the industry’s image.
Case 1: Delayed Baggage on Return Flight Not Covered
No Compensation Offered Despite 31-Hour Delay
The complainant travelled to Canada and purchased travel insurance from Insurance Company A before departure. On the return flight from Vancouver to Hong Kong, the complainant’s checked baggage did not arrive with the flight and was delivered to her residence the next day by airline staff, resulting in a delay of approximately 31 hours. Upon reviewing the policy, the complainant found that “baggage delay” coverage provided a maximum of HK$300 compensation for every 6 hours of delay, and submitted a claim for HK$1,500. However, Insurance Company A rejected the claim, stating that baggage delay on return flights was not covered. The complainant did not accept the explanation and lodged a complaint with the Council.
Insurance Company A explained to the Council that “baggage delay” coverage applies to reasonable and necessary expenses for clothing, essentials, or toiletries incurred due to delayed baggage upon arrival at the destination. The “exclusions” section also stated that any loss incurred after returning to Hong Kong was not covered under “baggage delay”. Insurance Company A argued that the complainant should have had access to necessary items at home, and therefore refused compensation. The case was ultimately unresolved.
Case 2: Flight Cancelled Due to Industrial Action
No Compensation as Ticket Was Purchased After Departure from Hong Kong
The complainant planned a multi-country self-planned trip to Europe lasting over 2 months and purchased a global travel insurance policy from Insurance Company B, with a premium of around HK$850. While in Italy, the complainant’s scheduled flight to the UK, which was purchased after the journey had begun, was cancelled due to industrial action, with no confirmed resumption time. She had to purchase a ticket from another airline to continue the journey, arriving in the UK 32 hours later than scheduled. The policy stated that for every 6 hours of flight delay, HK$250 would be compensated. After the trip, she submitted a claim to Insurance Company B for HK$1,250. However, Insurance Company B replied that although delays due to industrial action were covered, only flights booked before the start of the journey were eligible. As the cancelled flight was purchased after the journey had begun, it was not covered. Dissatisfied, the complainant argued that for longer trips, it is difficult for consumers to book all transport arrangements before departure, and filed complaints with both the Insurance Complaints Bureau (ICB) and the Council.
Insurance Company B cited the same clause in its reply to the Council, explaining that the ticket was purchased after the complainant had left Hong Kong, and therefore did not meet the compensation criteria. However, under Council’s conciliation, the company agreed to make a discretionary arrangement and compensate the complainant HK$1,250, thereby resolving the case.
Case 3: Stranded During Road Trip Due to Snowstorm
Not Covered Under “Trip Curtailment” or “Travel Delay”
The complainant went on a 7-day self-driving road trip in Japan and purchased an Asia-wide travel insurance policy from Insurance Company C, with a premium of around HK$350. While driving to a hotel located in the mountains, the complainant encountered heavy snow and was stranded on a mountain highway for over 8 hours. He was eventually rescued by emergency roadside assistance and arrived at the hotel the next morning under escort. The complainant believed the incident shortened his hotel stay and affected his accommodation experience, and should be covered under “trip curtailment” and “travel delay” in the policy. He submitted a claim to Insurance Company C for the cost of emergency roadside assistance and one night’s hotel accommodation, totalling approximately JPY¥100,000. However, Insurance Company C later informed him via email that the claim was not within the scope of coverage. The complainant repeatedly negotiated with Insurance Company C requesting a reassessment and a detailed explanation for the rejection, but received no further response. He thus sought assistance from the Council.
Insurance Company C replied to the Council stating that “trip curtailment” coverage refers to losses caused by shortening or changing the trip, which did not apply to the complainant’s case. “Travel delay” coverage applies to delays of public transport due to force majeure, and the insured must be travelling on a regular route of public transport with a valid boarding pass or ticket indicating the scheduled departure or arrival time and route. As the rented vehicle was not public transport, it was not covered under “travel delay”. Insurance Company C also reviewed other coverage areas in the policy but found the complainant’s case to be outside the scope, and therefore could not offer any compensation. The Council advised the complainant to consider seeking advice from the ICB if dissatisfied with the claim result.
Consumers May Refer to the Following Advice When Choosing Travel Insurance:
- Carefully compare the coverage scope and exclusions of different insurance plans. If unsure whether specific activities during the trip are covered, such as high-risk or extreme sports, consult the insurance company before purchasing;
- After taking out an insurance policy, retain all policy documents and travel-related records, such as booking confirmations, air tickets, and receipts, etc. for use as evidence in case of claims;
- If planning a self-driving trip, consider purchasing additional coverage such as Collision Damage Waiver (CDW), third-party liability insurance, or insurance plans specifically designed for self-driving trips that offer emergency roadside assistance;
- Policy terms usually include definitions of terms used in the policy, such as “booked trip”, which may refer to accommodation, transport, or sports activities purchased before the trip begins but used during the insured period; and “journey”, which refers to a trip originating from Hong Kong during the insured period. These definitions affect the interpretation of policy terms and the success of claims, so consumers should read them carefully before purchasing;
- If consumers encounter disputes regarding insurance matters, they may contact the Council or, depending on the nature of the dispute, the Insurance Authority (IA) or the ICB. The IA regulates insurance companies and licensed intermediaries, and its website provides registries of both. If misconduct is suspected, such as poor sales practices or misleading statements, consumers may contact the IA. For disputes over insurance claims, consumers may contact the ICB.
Download the article (Chinese only): https://ccchoice.org/589-cases
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