Couple win case for riot payout
A pair of Hong Kong travellers sought an insurance payout for having to shorten their Tunisia trip last year because of 'riots'. But to the insurer it was a 'civil commotion' that would not qualify them for compensation.
The case, cited by the Insurance Claims Complaints Bureau yesterday, was typical of an insurance dispute - how policy terms are interpreted by insurers and policyholders.
The couple's return flight in January last year was cancelled because of the unrest, prompting them to buy their own tickets, for which they demanded to be compensated.
The bureau's complaints panel found that the couple's policy stated compensation would be due to travellers whose plans were affected by 'riots', but the insurance company did not define what a riot was.
The panel considered that the media generally reported what was happening in Tunisia at the time as 'rioting', and said a common policyholder would not know how to differentiate between a civil commotion and a riot. The panel also noted the English and Chinese terms did not match.
It ruled that the couple should be entitled to a HK$26,000 payout, and advised the insurer to be more explicit and precise in its policy terms.
Michael Tsui Fuk-sun, chairman of the bureau's complaints panel, said: 'How words are defined in an insurance policy transcends how a common person or a dictionary would define them, but the words are defined according to the meaning within the contract.
'Consumers are advised to read their insurance policies very carefully and not just apply their own meaning ... because only the policy's definition of the word stands.'
Such disputes accounted for 39 per cent of complaints handled by the bureau last year.
Most of the 495 complaints it received were on medical and travel policies. The panel ruled in favour of the policyholder in 12 cases and defended the insurance company's decision in 46 cases. Sixty-one cases were settled outside the panel.
Tsui said that where the insurer did not provide a definition, other insurers' policies would be used for reference, he said.
There was room for improvement, he said. 'No policy is perfect. Insurance companies should work continuously on providing clearer definitions of its terms and learn from new complaint cases.'
Consumers should also play a part, he said, advising those who sought to buy health and medical insurance to disclose their full medical histories to avoid being disqualified from claiming benefits when the need arose.
Last year a dish washer fell over at work and complained of back pain, but the insurer rejected her accident claim. The panel found the woman had already suffered back pain on and off for about two years, so the accident could not be established at the sole cause of the pain.
'If in doubt, it is better to disclose the full medical history to the insurance company because it is to the consumer's benefit,' Tsui said.
The number of complaints last year dropped 15 per cent from 2010.
The jurisdiction limit in cases involving the Insurance Claims Complaints Bureau