We rely on our travel insurance to be there for when things don’t go our way, especially when we’re abroad and don’t know the ropes. So why are so many consumers failing to get the cover they need?
Could you afford £300,000 for a medical emergency on holiday? That’s how much a heart bypass and repatriation from the US could cost.
And while the average claim is much lower, at £930, it’s the risk of those unexpected catastrophes that prompts holidaymakers to take out travel insurance for every trip. But when the worst happens, where are the insurers? In far too many cases, nowhere to be seen.
Why are insurers unfairly rejecting so many claims? It’s all to do with the way companies interpret the conditions of cover in their policies. The devil can be in the detail with some policies, and with cover and exclusions varying, the policy you choose could be the difference between your claim being paid or rejected.
Digging into the detail is exactly what Richard Wilson had to do when he cancelled a £4,000 family holiday to New Zealand in 2013 after his father-in-law was taken gravely ill. The holiday was booked before Richard and his family knew the seriousness of his father-in-law’s condition. His insurer initially declined the claim, saying he should have foreseen the illness, given his father-inlaw’s age and other recent illnesses he’d had.
Richard told us the problem was that he wasn’t privy to what the doctors had told his father-in-law. He went on to say: “After much argument and with some help from the insurance brokers I’d taken out my policy with, the provider paid out.” If you find yourself in a tricky situation like this one and aren’t having much luck with your claim, we’ve highlighted 5 steps to boost your chances of success.
What the Financial Ombudsman says
Of course, I know travel insurers need to protect themselves against dodgy claims and fraud. But some of the policy exclusions we’ve seen – including the need to report thefts or losses to the police within 24 hours and not being covered for relatives’ illnesses that you didn’t know about – seem unduly harsh on policyholders
We’d like to see more insurers relaxing reporting times to make it easier for holidaymakers to report a loss without disrupting their holiday plans too much. And it would be fairer if companies could accept more ways of proving ownership for lost or stolen possessions.
It’s unrealistic to expect us to keep hold of receipts years after buying products. Some insurers accept an instruction manual as proof of ownership, which is a reasonable way to prove you own something. As for claims based on relatives falling ill, it would be much fairer if all policies covered you for the conditions you weren’t aware of.
We asked the Financial Ombudsman for their view on claims:
‘We’ve seen examples of good practice among travel-insurance providers, but a disappointing number of bad ones still arrive every year. When it comes to claims, we expect insurers to demonstrate that they’re behaving fairly by honouring the essence of the contract – not looking for reasons not to pay.’
‘However, we still receive enquiries from consumers who failed to get the additional cover they needed when taking part in winter sports like skiing. Even hiking can have an element of danger in the snow, so check with your insurer before you travel – and if something does go wrong, keep its policy and international phone number handy.’
Have you had any issues claiming on your travel insurance? If yes, was it fair your claim was rejected?