John* and Ida* booked flights to Queenstown for a guided hiking tour in March 2023. Their hiking tour was scheduled to begin the morning after they arrived in Queenstown.
John and Ida's flight was cancelled due to poor weather while they were at the airport. They bought tickets for the only other flight to Queenstown that day to make their hiking tour on time. Their replacement tickets cost an additional $150. John and Ida bought a meal at the airport because their replacement flight departed later in the day.
John and Ida contacted the airline that day to request a refund for their cancelled flights. They also wanted the airline to cover the additional cost of their replacement flights. The airline gave John and Ida a credit voucher equal to the value of their cancelled flights.
In early April, John and Ida contacted their travel insurer because they wanted a full refund rather than a credit voucher, compensation for the additional cost of their replacement flights, and compensation for their airport meal.
The airline gave John and Ida a full refund and voided their credit.
In May, the insurer told John and Ida that they could not claim the additional cost of their replacement flights or their airport meal. The policy said the insurer would pay ‘reasonable additional expenses’ if the insured was unable to attend a ‘sporting event’ due to unforeseen and uncontrollable circumstances.
The insurer said the policy did not apply because a scenic hiking tour was not a ‘sporting event’. John and Ida challenged the insurer’s decision.
The insurer compromised on their initial decision and accepted John and Idas’ claim for airport food. The insurer maintained that John and Ida did not have a valid claim for the additional cost of their replacement flights.
John and Ida complained to FSCL.
The key issue in John and Idas’ complaint was whether their hiking tour was a ‘sporting event’ under their insurance policy.
The insurer said the hiking tour was a ‘leisure trip’ rather than a ‘sporting event’. On this basis, the insurer said the hiking tour was not covered by their policy. The insurer said that the policy wording was clear; John and Ida had an obligation to read and understand it.
John and Ida said the hiking tour was a ‘sporting event’. They wanted $150 for the additional cost of their replacement flights.
FSCL reviewed the insurance policy, and the insurer’s correspondence with John and Ida. FSCL thought the insurer applied the policy correctly. John and Idas’ hiking tour was not a ‘sporting event’ under the policy wording.
It was FSCL’s view that John and Ida should discontinue their complaint.
John and Ida accepted the preliminary view and discontinued their complaint.