Austin Tourist Park’s COVID-19 insurance win

Bungled terminology sparked a stunning legal win for the Austin Tourist Park, who could receive insurance compensation due to business interruptions caused by COVID-19.

The Australian Financial Complaints Authority (AFCA) represented four businesses in a ‘test case’ in the NSW Court of Appeal, against the Insurance Council of Australia (ICA) representing impacted insurance providers.

In Austin Tourist Park’s case, insurer HDI Global Specialty used dated terminology to knock back a claim on its ‘Tourist Parks & Lifestyle Villages Insurance Policy’ in the clause below.

“The cover … does not apply to any circumstances involving ‘Highly Pathogenic Avian Influenza in Humans’ or other diseases declared to be quarantinable diseases under the Australian Quarantine Act 1908 and subsequent amendments,” it said.

But the Australian Quarantine Act 1908 was repealed in 2016.

HDI Global Specialty believed it could exclude COVID-19 business interruption losses in its cover, arguing the Biosecurity Act 2015 acts as a subsequent amendment.

But the Court upheld the policy’s ‘quarantinable diseases’ definition, with COVID-19 named as a ‘listed human disease’ in the current Biosecurity Act 2015.

“COVID-19 is not a disease declared to be a quarantinable disease under the Quarantine Act 1908, and the exclusion in the HDI Disease Benefit are not enlivened,” it found.

Other insurance companies referencing the repealed act are reviewing their policies in light of this decision.

The ICA will examine whether it could appeal the decision in the High Court of Australia.