Australian travel insurers are under renewed scrutiny over how war and conflict exclusions are communicated, as more Australians book low-cost flights via Middle East hubs and regional instability continues to affect airspace, schedules, and claims. Industry bodies and legal practitioners report a growing gap between customer expectations and the limits of standard travel cover, particularly where itineraries include transit through destinations such as the United Arab Emirates, Qatar, Bahrain, Israel, and Lebanon.
Brisbane-based travel lawyer Peter Carter, director of Carter Capner Law, said reports of discounted fares on routes operating through Dubai and the wider Middle East are prompting questions about insurance coverage for trips that intersect with higher-risk regions. He said disruption costs arising from delays and diversions are not typically borne by carriers. “Airlines never accept liability for disruption to forward travel arrangements that follow flight diversions or delays,” Carter said.
Carter also noted that standard travel policies across the market generally exclude losses linked to war and similar events. Most wordings carve out invasion, acts of foreign enemies, hostilities, civil war, rebellion, or insurrection, including related claims such as cancellations, medical expenses, or evacuations, irrespective of whether war has been formally declared. “So, if you are on a flight that terminates or transits through the UAE, Qatar, Bahrain, Israel, or Lebanon, then it’s wise to ask your travel insurer if they will extend cover. If you don’t ask or if they refuse the additional cover disruption to your travel schedule due to hostilities, a resulting loss of your baggage or any medical issue will put you to significant expense,” Carter said. His comments highlight the importance of pre-travel advice, product disclosure statements (PDSs), and policy schedules clearly outlining how war exclusions interact with changing airline routings and conflict zones.
The Insurance Council of Australia (ICA) has declared the Middle East conflict a Significant Event, citing its impact on Australians overseas and on global aviation networks. Under the declaration, an industry-wide taskforce has been established, with claims data collection, analysis, and reporting underway in consultation with member companies. ICA representatives are also working with the Federal Government and relevant agencies to coordinate support for affected Australians.
Travel insurers have added call-centre capacity, 24/7 assistance, and support with medical care coordination for policyholders in impacted countries. ICA members have indicated that policy coverage dates may be extended for customers affected by airspace closures and airport shutdowns. Impacted policyholders are being encouraged to notify their insurer and submit claims even if they are unsure whether the loss is covered under their policy.
The ICA has restated that war and conflict exclusions are embedded across general insurance portfolios globally. The council says the scale and unpredictability of armed conflict make it difficult to price and pool such risks, and that including full war cover in standard products would likely increase premiums for all travellers. At the same time, the industry body has emphasised that policyholders may still have cover for losses not directly caused by war or conflict, even where they occur in a conflict zone. Depending on the policy, this can include emergency medical treatment for unrelated illnesses or accidents, loss or damage to luggage not caused by a hostile act, evacuation coordination, and some death or disability benefits where the proximate cause is not a war-related event.
Coverage, limits, and sublimits differ between insurers and products. The ICA has advised that customers and intermediaries review PDSs and contact insurers to clarify entitlements in specific scenarios. The council has also indicated that, because acts of war are already excluded in standard travel policies, the current conflict alone is unlikely to produce immediate, direct premium increases. Any future pricing impact would depend on how loss patterns develop, the duration of the conflict, and broader market conditions.
The Australian government’s Smartraveller service on March 12 warned that “the regional conflict is likely to continue and could escalate. If you want to leave the Middle East, do not wait until it’s too late. If you can secure a flight out of the Middle East and it’s safe to travel to the airport, leave now while commercial flights are available.” The advisory states that the conflict has led to airspace closures, flight cancellations, and wider disruption that may affect Australian travellers even when their final destination is outside the Middle East. Travellers are urged to stay in contact with airlines or travel agents and to avoid cancelling flights until they receive professional advice.
Smartraveller’s country-by-country ratings are a key reference point when reviewing claims and pre-travel risk. The ICA has reminded travellers that proceeding with trips contrary to a “Do Not Travel” advisory is likely to affect coverage, while being diverted into a “Do Not Travel” destination unintentionally does not automatically void a policy. In such cases, claim outcomes depend on whether the loss stems directly from the conflict or from another covered cause. The government is encouraging Australians in affected countries to register with the Department of Foreign Affairs and Trade (DFAT) and to follow official guidance on staying indoors, monitoring local warnings, and planning departures where feasible. As airlines continue to adjust schedules to and through the Middle East, the interaction between air operations, government advisories, and policy wordings is expected to remain a focus for the Australian travel insurance market through 2026.
