The Australian government’s decision to raise travel advisories for Jordan, Oman, and Saudi Arabia to Level 3 on July 21, 2026, has triggered known-event exclusion clauses in travel insurance policies purchased from that date – adding three more countries to a regional risk map that now covers eight Middle Eastern nations under the “Reconsider your need to travel” designation.
The upgrades, issued by DFAT on Smartraveller, cite an “unpredictable security situation” and warn that airspace may close at short notice, flights may change suddenly, and borders may close. Jordan, Oman, and Saudi Arabia join Bahrain, Israel, Kuwait, Qatar, and the United Arab Emirates at Level 3. Iran, Iraq, Lebanon, Palestine, Syria, and Yemen remain at Level 4 – “Do not travel” – where standard policies provide no cover at all.
DFAT has been direct about the insurance implications of its advisory system throughout the current escalation. The government’s June 17, 2026, ministerial media release stated: “We also urge Australians planning to travel to make sure they have travel insurance and to closely read the Product Disclosure Statement (PDS) for what is and isn’t covered.” The same release confirmed that Jordan, Oman, and Saudi Arabia have been under “Reconsider your need to travel” advice throughout – a status now formalised as Level 3 following the July 21 upgrades. Smartraveller’s current conflict hub guidance is equally direct: “Check your travel insurance policy for coverage of flight delays, cancellations, and changes to travel advice levels.”
For policies purchased from July 21, the known-event mechanism limits which claims will respond. The Smartraveller travel insurance guidance – co-published with CHOICE on the Smartraveller platform – sets out how the Australian Financial Complaints Authority (AFCA) approaches resulting disputes: AFCA expects the policyholder to establish on the balance of probabilities that they suffered a loss caused by an event to which the policy responds, while the insurer must prove the claim is excluded. Most standard policies will not cover travel to “Do not travel” destinations.
Standard Australian travel insurance policies cover only unforeseen events. Once a travel advisory is issued and receives broad media coverage, it is treated as a known event – a reasonable person in the policyholder's circumstances is assumed to have been aware of it at the time of purchase. Allianz Australia’s product terms state the industry’s position plainly: there is no cover under any benefit of the policy if a claim arises because the policyholder did not follow advice or a warning issued by the Australian government or a reliable mass media source – this applies even if the Australian government has given permission to travel or the policyholder falls under a specific exemption.
The July upgrades sit within the industry response framework the Insurance Council of Australia (ICA) activated in March. The ICA’s published FAQ guidance confirms that standard travel insurance policies exclude losses directly caused by war and conflict – standard practice worldwide, given the scale and unpredictability of armed conflict creates risks that are difficult to price. However, some policies may still cover emergency medical expenses from incidents unrelated to the conflict, evacuation coordination, and death or disability benefits where the cause is not linked to a war-related event, with every claim assessed individually. Policyholders should contact their insurer and lodge a claim even if they are unsure of their coverage.
On future pricing, the ICA has stated: “Acts of war have always been excluded from travel insurance policies, meaning this event alone is unlikely to flow through to direct premium increases.” AFCA activated its significant event response plan following the ICA’s March 3 Significant Event declaration, providing for early stakeholder communication and a streamlined process for resolving related complaints.
AFCA received 34,231 general insurance complaints in 2024-25, a 17% increase on 2023-24, with denial of claim based on exclusion among the leading complaint categories. AFCA has upheld insurer denials of travel cancellation claims arising from the Middle East conflict in most determinations, illustrating the broad reach of the war exclusion. A recurring dynamic is that where flights remain operational, insurers may treat a policyholder’s decision not to travel as voluntary – regardless of the advisory level – a position that has contributed to complaint volumes tracked by AFCA.
Smartraveller’s Jordan advisory makes the transit principle explicit: “‘Reconsider your need to travel’ also means ‘reconsider your need to transit.’ If you need to travel to any Level 3 locations, stay as short a time as possible and eliminate unnecessary activities.” The European Union Aviation Safety Agency (EASA) has separately issued advice to air operators to avoid Gulf airspace until at least July 29, 2026. For insurers writing policies for Australians routing through Gulf hubs, the combined effect of Smartraveller’s transit framing and the EASA airspace restriction has direct implications for how transit coverage is defined in current PDS documentation.
Australians made 11.5 million overseas trips in calendar year 2024, rebounding above 2019 pre-pandemic levels. According to DFAT country economic fact sheets, Australian recreational travel to Jordan was valued at $8 million and to Oman at $7 million in 2023-24. Saudi Arabia is a significant bilateral partner, with two-way goods and services trade totalling $2.07 billion in FY 2023-24 – a relationship spanning corporate travel and education flows alongside leisure, extending the exposure well beyond retail travel insurance lines.
