The Insurance Ombudsman, who has the power to overturn insurers' decisions and who will arbitrate for free on disputed claims, says some insurers are over-using a reasonable care "get-out" clause in policies. Many rejections of this kind, if brought to the ombudsman - or to the courts - would face being overturned. "You should always challenge a rejection of this kind," says a spokes-man for the ombudsman.
The call comes as travel insurers brace themselves for many thousands of claims for holidays taken this summer - around one in 20 holidaymakers puts in some sort of travel insurance claim.
Past experience suggests many holidaymakers will be disappointed at insurers' apparent attempts to wriggle out of claims. With thefts and losses, the ombudsman says that insurers need to do more than simply assert that a holidaymaker did not show "reasonable care" to avoid paying up: they need to prove "recklessness" - that someone had "courted a known risk" and taken no steps to reduce risks.
In practice this means that people who fall asleep on the beach and wake to find belongings gone should be entitled to a payout, although the ombudsman's view might change if the losses were very high, and people who go swimming and return to find possessions missing are less likely to have a case.
The ombudsman, who can only consider cases brought to his attention once you have reached deadlock with an insurer, has other advice to holidaymakers fighting insurers.
Insurers are not entitled to reject claims for lost or stolen valuables just because holidaymakers do not have receipts, he says. In the past some insurers have insisted on receipts or manuals for items such as cameras as a way of reducing or avoiding altogether the cost of a claim because they doubt an incident actually took place. But holidaymakers will not always be able to produce receipts or other documentation, particularly for older items. Insurers may be required to accept a police report of a theft abroad as sufficient evidence for full settlement, says the ombudsman.
Insurers, perhaps not surprisingly, are unhappy with this view and in many cases regard it as encouraging fraudulent claims (see article below).
Another point is that where a policy carries what is deemed an unusual or onerous condition or exclusion, this should be brought to the holidaymakers' attention when the policy is taken out. If it was not, and the condition is used as the reason why a claim will not be paid, then a holidaymaker may have a case for being paid, says the ombudsman. Examples of such exclusions include accidents from riding a bicycle (sometimes excluded on the basis of being a "hazardous activity") or having to give a month's notice of any cancellation: most cancellations stem from last-minute emergencies or illness.
Here are some other tips to help get claims paid:
q Read through the policy before you go to check that it covers sports and activities you might do. Many insurers are prepared to add in activities, often at no extra cost, but you should get this in writing. Equally, since cover for the treatment of existing medical conditions is normally included, if you want cover you should get something in writing. Also watch out for limits on the value of possessions. Most policies have single-item limits of pounds 250 so if you have an expensive camera it might be worth covering it through an "all-risks" extension to your household policy, which gives cover outside the home. Equally, if you don't want to lose a no-claims discount on a home policy, ensure that you do not have an all-risks extension that a travel insurer can take a "contribution" from.
q Take a copy of the policy document with you. It should include helpline numbers and tell you what to do if something goes wrong. If you do need medical treatment, contact the given emergency assistance number as soon as possible.
q If possessions are lost or stolen, report the loss to the police within 24 hours and get a police report, or at least a reference number for the report.
q Ensure that you get receipts for any expenses that you plan to claim for.
q Stick to any time limit for claiming set by the policy - normally within 31 days of your return.
q Avoid sob stories when making a claim. They are unlikely to cut any ice. Equally, don't be surprised if a failure to provide information or documentation only leads to delays.
q Be persistent - if your claim is rejected take it to the chairman's office. If the insurer does not offer to settle in full, write to say you plan to take the claim to the complaints body of which the insurer is a member (normally the Insurance Ombudsman, 0171 928 7600, but sometimes the Personal Insurance Arbitration Service, 0171 837 4483). This may prompt the insurer to settle. Taking a claim to the ombudsman will cost the insurer around
pounds 500 whether it wins or loses. With the average baggage claim being a few hundred pounds, and that for medical expenses not much more, an insurer might be tempted to settle.
q Even if a claim for cancelling a holiday is rejected, the policyholder may be entitled to a part-rebate of the policy premium.
q If baggage is lost or damaged during a flight, first report it to the airline. You cannot get "double" compensation from the carrier and an insurer, but with an insurer you might have to pay for the first pounds 30 or so of a claim (the excess): the airline may compensate you in full.
A travel insurance policy will normally offer some cover for travel delays, but don't expect it to cover wider "loss of enjoyment" - take this up with a travel agent or tour operator. Thomsons is offering to fly home, and pay full refunds to, holidaymakers who find their holiday does not match its brochure, but you are flown home early.