Travel insurance providers are not always keen to pay up but more often than not it's worthwhile appealing to the Ombudsman

There are few things worse than a holiday ruined when disaster strikes. It can be more annoying, still, when you ask for compensation from your travel insurer, to find the claim rebutted.

Many families, deterred by the headaches currently associated with foreign climes, are holidaying in the UK, so travel claims should in theory be falling along with overseas bookings.

Yet the Financial Ombudsman has seen a 28 per cent rise to 3,076 in the number of calls from consumers whose insurers aren't playing fair. And these statistics do not yet include ash cloud disputes, which remain ongoing.

Holidaymakers are right to pursue their grievances to the top as in many cases they have a legitimate complaint. The rate at which the Ombudsman decides in their favour and against the company, has also risen to 55 per cent, up from 44 per cent last year.

Association of British Insurers spokeswoman Kelly Ostler-Coyle denied companies are cracking down on paying claims.

She said: "We want people to buy travel insurance, so that would be a false economy. And it's important to remember that compared with the millions who go abroad every year, these complaints are still small in number.

"We've also had a very bad few months for travellers with strikes and so forth. In times of recession, we see an increase in fraudulent complaints, so it may be that more are being refused, but that doesn't mean legitimate claimants are turned away."

She also points to the dangers of buying very cheap contracts over the internet, which may not provide adequate cover.

Yet some of the grounds on which claims are refused are frankly bonkers. Scotland on Sunday takes a peek in the Ombudsman's post bag.

Roadside breakdown

When his motorhome broke down while driving through France, one policyholder with European roadside assistance cover, phoned his insurer, which arranged for the vehicle to be towed to a local garage for repair. The motorist was then horrified to be told his engine needed replacing, at an estimated cost of 6,000 euros.

He could not believe this and asked the insurer for the vehicle to be returned for assessment and repair in a UK garage. It refused.

Unhappy with the situation, the motorist made his own arrangements to get his motorhome back, where the problem was found to be a blocked air filter, costing 46 to replace.

It had cost him 1,136 to repatriate the vehicle, so he put in a claim, pointing out that the overall cost was still significantly lower than if he had followed the advice of the French garage.

The company rejected the claim, until it was forced to pay up by the Ombudsman and compensate the policyholder in full with interest.

Cruise control

During the first part of her holiday, aboard a cruise ship, a female, travelling alone, tripped and badly injured her ankle. She had been due to leave the ship the following day, when it reached Cyprus, as she had booked to stay at a hotel there for a week before flying home.

Because of her injury, she decided she would rather go straight home, as she could only get around in a wheelchair. Furthermore, a report by the ship's doctor recommended she return home immediately and completely immobilise her ankle for 10 to 14 days.

She was dismayed when her insurer rejected this diagnosis and said there was no medical reason for her to return. So she paid her own passage home.

But she later put in a claim for expenses such as the cost of cancelling her week's holiday at the hotel in Cyprus, her journey back to the UK, including flight and taxi fares, compensation for the time taken off work and the cost of taxi fares to and from her physiotherapy appointments. The insurer refused to pay.

But it was ordered to do so, with interest, for the costs incurred in cancelling her hotel booking and travelling back home, after the Ombudsman agreed there had been a medical necessity for her to curtail the holiday not least as she was travelling on her own and the hotel said it was unable to cater for someone alone and wheelchair-bound.

The watchdog ordered a further 250 compensation for the poor service she had received and the distress and inconvenience caused.

However, her claims for time off work, physio and taxi expenses were refused, as these were not covered by the contract.

Trains, boats and planes

Industrial action by French rail workers put paid to another holidaymaker's journey to Italy. He had planned to travel by train from London to Paris, then stay overnight before continuing on by rail the next day, making one further change of train before he reached Milan.

Everything ran smoothly until he arrived in Paris, where it became clear industrial action would seriously delay his train from Paris, and he would miss the connection with the Milan train, on which he had booked a seat. He decided to travel direct from Paris to Milan by air.

After he returned home, he put in a claim to his travel insurer for the cost of this flight. The insurer rejected his claim, saying that, under the terms of his policy, it was only able to pay "additional costs incurred in reaching a destination" if a policyholder arrived "at the final point of international departure too late to board for travel on the outward journey from the UK."

It judged his "final point of international departure" to have been the Eurostar station in London and said there was "no cover for the other legs of the journey."

The Ombudsman took the sensible view that although his journey was broken into three stages, involving three different trains and an overnight stay in Paris, it was clearly planned as a continuous journey from London to Milan.

Furthermore, there was no definition of "international departure" in the contract, and the watchdog said the term could be interpreted in more than one way, as could "from the UK". The words could be taken simply to distinguish the outward journey from the return journey, and to show that the policy covered the journey to reach the main destination, rather than any travel or shorter trips taken during the holiday itself.

The Ombudsman said in the light of this ambiguity, the insurer should pay the claim in full, with interest.