Alcohol and travel insurance: The catch Aussies need to know about

While letting your hair down on holidays and having a drink is common, most travel insurance policies have an exclusion along the lines of:

We will not pay for claims arising directly or indirectly from any conduct engaged in by you whilst under the influence of alcohol or drugs, unless prescribed by a doctor and taken in accordance with the doctor’s advice.

Do any insurers cover alcohol-related claims?

All travel insurance policies include a general exclusion that rejects claims if alcohol was the root cause of the incident. The reasons for this are two-fold: to encourage you to be mindful of how much you're drinking, and to limit the risk for the insurer.

The question of whether you're covered for drinking alcohol really comes down to how each insurance brand interprets its own exclusions.

How does an insurer know if you were under the influence?

Unless you're drug-tested or breathalysed, an insurer can't know for certain how much you had to drink.

Generally, it comes down to whether alcohol contributed or caused the incident, rather than simply whether alcohol was involved.

Some use the yardstick that applies to all aspects of insurance: "Was the incident unexpected?" This simply means: would a reasonable person expect their actions, in this case drinking too much, to lead to an incident that could have a negative outcome such as a claimable event e.g getting injured? If the answer if yes, then the incident was not unexpected and you wouldn't be covered.

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Some insurer-specific examples

The following examples show how three separate insurance brands deal with claims involving alcohol:

• Southern Cross Travel Insurance. Some insurers won't cover you if the alcohol involves you putting yourself in danger. For exampSCTI says it won't cover you if you put yourself in danger, which includes "you being under the influence of alcohol, solvents, or drugs — including your conduct while under their influence".
• Cover-More. Some insurers mention blood alcohol limits. Cover-More says it won't cover claims "involving, arising from or related to your impairment due to you drinking too much alcohol: which is evidenced by the results of a blood test which show that your blood alcohol concentration level is 0.19% or above." This is 4 times aboves the legal driving limit. It can also refuse alcohol-related claims based on a medical practitioner's report, third party witness or other documented piece of evidence.
• Fast Cover Some insurers don't leave much room for interpretation. Fast cover says it won't cover you "If you were under the influence of drugs or alcohol." It doesn't outline how it can make this determination.

Methanol poisoning and travel insurance

Insurers tend to look at methanol related claims on a case-by-case basis. However, most travel insurance policies contain a blanket drugs and alcohol exclusion and it is up to the individual insurer to interpret this.

Methanol poisoning occurs when someone consumes homemade alcohol containing methanol, a pure form of alcohol similar to ethanol. Not normally present in commercially produced spirits, methanol is converted by the body into a toxin called formic acid. This can build up in the blood and cause kidney failure, heart problems, liver damage, blindness, nerve and brain damage and ultimately death.

How does travel insurance work when it comes to drug use?

Insurers won't pay out for any claim related to drug use unless your drugs were prescribed by a medical professional.

An example. If you smoked marijuana in Thailand, hopped behind the wheel of your hire car and were then involved in an accident, your travel insurer would not provide any cover for your medical expenses, legal liability or rental vehicle insurance excess costs.

The drug use exclusion can even apply to people who aren't travelling with you. If you are forced to cut your trip short and return home following the serious illness or death of a relative as a result of drug use, your insurer may not provide any cover for cancellation or curtailment costs.

Booze bust: Why alcohol and travel insurance don't mix

Enjoying a drink is a normal part of any vacation. However, if you want to be covered by your travel insurance, you should understand the fine print in your policy.

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