One in three travel insurance policies sold by Southern Cross Travel Insurance (SCTI) in the first half of 2026 included a declared pre-existing medical condition. That proportion is not a company milestone – it is a market signal, and one that lands squarely on the broker's desk. New Zealand’s 65-and-over population is currently growing by more than 500 people a week, with one in six New Zealanders now in that age group, according to Stats NZ. In 2025, overseas departures from New Zealand exceeded pre-pandemic levels for the first time. A larger, older, more mobile client base means more travel policies placed for people managing declarable health conditions – and more exposure when disclosure conversations are missed at placement. The Contracts of Insurance Act 2024, coming into force by November 2027, will make that exposure statutory.
Speaking at a professional development seminar for Insurance Brokers Association of New Zealand (IBANZ) members, Fee Langstone partner Craig Langstone said the Act would require virtually every insurance policy in New Zealand to be rewritten, and that he was not yet seeing evidence of policy wordings being updated to comply. Under the Contracts of Insurance Act, intermediaries including brokers and financial advisers have a statutory obligation to pass on all representations made by the policyholder during the negotiation of the contract of insurance. Insurers can seek compensation from brokers for not passing information on; however, brokers cannot seek indemnities from policyholders for this potential breach.
The asymmetry is significant. A broker who fails to capture and transmit a client’s health change – a new medication, a specialist referral, a physiotherapy visit before departure – carries liability to the insurer with no recourse against the client who did not volunteer it. Under the Act, one of the factors to be considered when determining whether a policyholder has taken reasonable care is whether they had broker assistance, meaning the presence of a broker in the transaction raises, not lowers, the standard against which disclosure is judged.
Caroline Laband, partner at Wotton + Kearney, told Insurance Business New Zealand that brokers should not treat the 2027 deadline as distant. “It doesn’t come into effect until 2027 so we’ve got a couple of years to get used to it – but that time will go quickly. There’s a lot of work that the industry needs to be doing to get its products and systems up to scratch,” she said, adding that the review extends beyond policy documents to proposal forms and client communications.
For brokers placing travel insurance for clients with pre-existing conditions, the New Zealand market is not uniform. The differences between providers are material to the advice a broker gives. Cover-More automatically includes certain existing medical conditions in its policies, subject to criteria in its policy wording, and offers a short online medical assessment for conditions that fall outside automatic cover. Travel Insurance New Zealand covers 35 pre-existing medical conditions automatically at no additional cost, provided the condition has been stable for more than 12 months, the policyholder has no planned surgery or specialist review, and has not attended hospital for treatment in the past 12 months.
SCTI takes a different position. SCTI does not automatically cover any pre-existing conditions, requires a medical assessment to determine eligibility, and will not cover undiagnosed pre-existing medical conditions. Where cover is confirmed, it is backed by unlimited medical and evacuation cover under SCTI’s International Comprehensive policies. A broker who does not understand these distinctions – and does not ask specifically about recent health changes before selecting a product – risks recommending a policy that may not respond when the client needs it most. Failing to declare a pre-existing condition is the most common reason travel insurance claims are rejected in New Zealand, according to MoneyHub NZ. Under the incoming Act, that rejected claim may also become the basis of an insurer's action against the broker who placed the policy.
SCTI defines a pre-existing condition broadly: not only diagnosed conditions, but any health symptom, recent appointment, test result, medication change, injury, or professional health advice received before a policy is purchased or a trip begins. Jess Strange, chief customer officer for SCTI, said clients frequently underestimate the scope. “For someone booking a long-awaited trip, a recent medication change, test result, or injury can feel like the detail that puts the whole holiday at risk. We are often asked, ‘do I need to declare every health condition?’ and the simple answer is that the earlier customers disclose a pre-existing condition or a change in their health, the more clearly their insurer can explain what can and cannot be covered. We can’t offer cover for an undisclosed condition or symptom, so it’s essential customers share as much as they can with us. We assess people’s circumstances individually, because no two travellers, conditions, or trips are the same,” Strange said.
Under the incoming Act, insurers will no longer be able to rely on catch-all questions such as “have you told us everything we need to know?” Proposal forms are likely to become longer and more detailed, with insurers required to ask specific, unambiguous questions rather than broad invitations to disclose. For brokers using generic proposal forms for travel placements, that is an operational change that requires attention before 2027.
The cost of inadequate disclosure falls first on the client. SCTI paid more than 3,500 medical claims in the first half of 2026 to customers who had declared their conditions, averaging more than $5,000 per claim. Its 2025 international medical and evacuation spend totalled $14.9 million, including a $642,000 illness claim in Italy and $1.3 million for ICU treatment following a fall in the US. Across the industry, the Insurance Council of New Zealand’s (ICNZ) 2025 Annual Review recorded gross claims incurred in the “other” category – which includes personal accident, travel, and livestock – of $154.5 million in 2025, more than double the $66.7 million recorded in 2021, reflecting structural growth in travel claims volumes across the post-pandemic period.
Where a condition cannot be fully insured, SCTI said it can often still offer cover for unrelated medical events, delays, and cancellations. Strange said: “Even if we cannot insure the specific condition, we can often still support customers with many other things that can disrupt a long-awaited trip.” For brokers, that means the pre-existing condition conversation at placement is rarely a dead end. Under the Contracts of Insurance Act, however, not having it at all is no longer defensible.
