A trek guide who chartered a helicopter to deliver vital equipment that was delayed in transit has lost a coverage dispute, even though his actions prevented separate trip cancellation claims from his 29 clients.

The guide travelled to Papua New Guinea to lead a remote trek, but his luggage was delayed, including equipment necessary for the tour to go ahead.

Replacements could not be sourced locally, so to avoid cancelling the trip he chartered a helicopter to deliver the items.

The Australian Financial Complaints Authority says the decision to retrieve the delayed luggage probably reduced Nib Travel Services’ overall loss.

But it still backs denial of the man’s charter fee reimbursement claim, because the loss arose from delay of luggage by an airline.

“The policy does not provide cover for the type of loss claimed and the insurer did not provide any assurance that cover would be available,” AFCA said.

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The guide said he contacted Nib and it was agreed the only option was to charter a helicopter and then submit a claim for costs.

But AFCA says the evidence does not establish this is what happened. Nib replied to an SMS advising only that it would assess the claim once submitted.

The policy would respond when a trip was cancelled, rearranged or interrupted due to listed events. An emergency luggage benefit covered only the cost of buying essential items such as clothing and toiletries up to $500.

An AFCA ombudsman said this was not claimed and “rather, he seeks reimbursement of the cost of transporting the delayed luggage itself. I am not satisfied the emergency luggage benefit extends to the cost of retrieving delayed baggage.”

The guide said if he had not organised the charter flight, the tour would have been cancelled and Nib would have received 29 claims under client policies.

“I appreciate this arrangement may have significantly reduced the insurer’s overall loss. However, the insurer is only liable for the claim if it falls within the cover provided by the policy,” the ombudsman said.

“While the policy places a duty to prevent further loss or damage on the complainant, it only relates to the insured loss, being the delayed luggage. As helicopter charter did not minimise that loss, the insurer is not liable for the cost.”

The guide held a Nib policy for 10 years, referred all clients for cover, and said Nib knew his business well and should have told him the policy was unsuitable.

But AFCA says an insurer “does not act for the complainant, and there is no expectation that it provides personal advice regarding whether its products are suitable. That the insurer is not expected to investigate whether its product is suited for the complainant’s needs is reinforced via the product disclosure statement, which says: ‘You have 21 days ... to decide if the cover is right for you.’ ”

The certificate of insurance also stated: “This is general advice only. Before you buy, you should consider your needs.”

See the ruling here.