Need to know
- A few drinks won't void your travel insurance policy, but insurers may deny claims that result from you being drunk
- How travel insurers define drunkenness can vary considerably
- If you disagree with your insurer's assessment of how the drink affected you, you can dispute their decision
For many of us, enjoying the local liquor is part of enjoying a holiday. But if you have a few drinks while you're on vacation, will travel insurance still cover you? We look at how insurers apply alcohol exclusions and what you can expect.
On this page:
- Does travel insurance cover alcohol?
- When do insurers apply the alcohol exclusion?
- How much alcohol is too much for a travel insurer?
- How does the insurer know how much alcohol you've drunk?
- What if my drink was tampered with?
- What about drug use? Can your claim be voided if drugs are detected?
- What to do if your travel insurer denies your claim
Does travel insurance cover alcohol?
Having a couple of drinks won't void your travel insurance cover for your whole holiday. But travel insurance won't cover you for events that arise because you were under the influence of alcohol.
If you leave your phone in a taxi or fall off a bar stool and break a bone, your insurer will probably deny your claim if they think it occurred because you were drunk.
Having a couple drinks won't void your travel insurance cover for your whole holiday
Travel insurance covers you for unforeseen events, but insurers rely to an extent on your own ability to foresee events and take evasive action. So for example, if a volcano affects travellers to Bali, your insurance won't cover you if you know about the volcano but don't take action to avoid being impacted by it.
If you've had a few too many drinks, your ability to foresee events is blurred. So there's a much higher risk of something going wrong, and if an event has too high a risk of actually occurring, then insurers don't want to cover it.
When do insurers apply the alcohol exclusion?
How the alcohol exclusion affects you can be as innocuous as having a few drinks at a wedding and slipping and breaking a leg, or something more sinister like having your drink spiked at a nightclub.
Here's an example provided by Smartraveller for the CHOICE travel insurance buying guide.
"Lee (not his real name) was attending a wedding in Phuket, Thailand, when he fell down some stairs at the hotel, breaking his leg and several ribs. Because he'd been celebrating with a few alcoholic drinks, his insurer refused his claim for medical expenses, citing his intoxication at the time."
"The incident cost Lee $10,300 in medical expenses, which had to be paid in full before he could leave hospital. Lee's injuries also meant he was unable to work for the next six weeks, causing further financial hardship."
Video: CHOICE calls for more transparency about alcohol exclusions in travel insurance.
How much alcohol is too much for a travel insurer?
Some insurers specify a blood alcohol limit over which they will not cover you. GoInsurance uses 0.10%, which is twice the legal driving limit, and a level at which your speech might be slurred.
Cover-More and other insurers specify a 0.19% limit. Some people will struggle to walk a straight line at that point.
Many insurers don't specify a limit though. If they think the amount you've had to drink caused or contributed to your claim, they might try to deny it. How they word the exclusion varies between insurers.
Insurer World2Cover, for example, says its cover excludes: "You being under the influence of alcohol where… Your judgement or actions are impaired and this impairment causes or contributes to any loss or damage."
For Allianz, it's when you're "...affected by any intoxicating liquor or drug to the extent that your physical, or mental functions, or your judgement are impaired".
'Under the influence' or 'affected by' alcohol is a grey area, but it generally comes into play at the point where the event that caused your claim wouldn't have occurred if it weren't for you being drunk.
If an insurer thinks the amount you've had to drink caused or contributed to your claim, they might try to deny it
If you slip on a wet walkway when you're drunk, an insurer may say that if you weren't drunk, you would've had better judgement and been able to avoid that slippery walkway, or at least walked more carefully across it.
If you break the local law where you are, travel insurance won't cover you. So if you drive a hire car or moped with a Blood Alcohol Concentration (BAC) greater than the legal limit for the country you're in, travel insurance won't cover you for any resulting incidents.
How does the insurer know how much alcohol you've drunk?
You may find a clause in your travel insurance policy that obliges you to agree to a blood alcohol or breath analysis. So if the insurer suspects you've had some drinks, they may get you to take a test before they agree to cover your claim.
If insurers can't get their hands on a Blood Alcohol Concentration (BAC) test in time, they may use other methods to estimate your BAC in order to decline your claim. In one case, Cover-More estimated a BAC based on the policyholder's weight and the drinks on their bar bill.
They might also use other methods to estimate it, including testimony from witnesses, bar receipts, medical reports or even how you describe events to the insurer.
How do you know if you're covered?
When you buy your policy, your travel insurer will send you a Product Disclosure Statement (PDS). The easiest way to find the alcohol clause is to open the document and do a find or Ctrl+F for 'alcohol' or 'liquor'. That should take you to a sobering read of alcohol and other exclusions in your travel insurance policy.
What if my drink was tampered with?
Drink spiking does unfortunately happen. Another common problem is that some drinks may contain methanol, which is toxic. It is sometimes used as a cheap substitute for alcohol in local home-brewed spirits, cocktails, or as a top up in brand-name alcohol bottles.
But if you have a high blood alcohol concentration, it can be hard to prove that it was because your drink was spiked. In this case, preventative action is the best strategy (not only for your insurance, but also for your own health and safety).
Smartraveller has some great tips to avoid getting into a fix. These include things like drinking in a safe space, avoiding cocktails or mixed drinks made by a bartender, and looking after your mates.
What about drug use? Can your claim be voided if drugs are detected?
Recreational drug use is legalised to an extent in some destinations around the world, but travel insurers still exclude cover for the use of non-prescription drugs.
Often it's in the same clause as alcohol use. For example they exclude a claim that arose because you were "under the influence of any intoxicating liquor or drugs (except a drug prescribed to you)".
And use of illegal drugs is of course excluded. So you need to know the local laws wherever you're visiting.
Other alcohol and drug exclusions
Another exclusion you'll come across is for claims that relate to the treatment of alcoholism, drug addiction or substance addiction. This may mean your visit to a rehabilitation clinic, but it can also extend to other people.
For example, if you want to interrupt your holiday to travel home to visit a sick relative, the insurer may deny your claim if your relative is sick due to chronic use of alcohol or drugs (whereas you claim may be approved if your family member is suffering a different type of medical issue).
What to do if your travel insurer denies your claim
If your travel insurer denies your claim because they reckon you had too much to drink, but you disagree with them, the first step is to lodge an internal dispute with your insurer. Check the insurer's website or PDS for their official complaints procedure and contact details (usually an email address).
If the insurer still denies your claim after you lodge a dispute with them, you can raise a dispute with the independent ombudsman, the Australian Financial Complaints Authority (AFCA).
Even if you were drinking, the insurer still has to prove you were drunk and that this intoxication actually caused the event that led to your claim.
Even if you were drinking, the insurer still has to prove you were drunk and that this intoxication actually caused the event that led to your claim
A ruling by the Financial Ombudsman Service, AFCA's predecessor, found that an insurer was not able to rely on the exclusion to deny a claim for a woman who left a backpack in a taxi after a couple of drinks (this was a while ago but it's not easy to find recent cases where the insurer lost). The ruling stated:
"...she [admits to] consuming a number of drinks on the evening but was not under the influence nor did the loss arise directly or indirectly from the influence of alcohol. Other than this statement, there is no evidence regarding the influence of alcohol."
"The Applicant claims the backpack was left in the cab in the confusion of trying to settle the cab fare whilst at the same time keeping an eye on children. There is no evidence to contradict this.
"The evidence is not sufficient to establish that the loss arose directly or indirectly from the influence of alcohol."
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