| Nowadays, the trend of consulting a comparison | | | | medical problem when a policy is purchased. Many |
| site before purchasing a travel policy is having a | | | | people do not realise that this requirement |
| seriously unhealthy effect on the market. When | | | | extends to 'annual multi-trip' policies as well. The |
| they began, the comparison sites just searched | | | | phrase 'annual policy' is misleading because each |
| on price, but now most will show the price plus | | | | trip is in fact a new policy and the company will |
| 'key features', which normally mean the amount | | | | assume you are confirming the status quo on |
| of medical cover, cancellation cover, baggage | | | | your medical history before you book a new trip. |
| cover and maybe a couple of other items. The | | | | If you develop an illness during the course of an |
| consumer is bound to look for the company | | | | annual policy and fail to inform the insurer, they |
| offering the highest medical sum for the lowest | | | | can invalidate the policy. You should be aware that |
| price - and if the amount shown for baggage is | | | | some insurers will pose particularly tough extra |
| £100 higher than the next best that will | | | | charges or conditions on people who call them |
| probably swing the deal. | | | | during a policy to advise them of a change in |
| Of course, this means many insurers deliberately | | | | health. A few insurers like to think they have you |
| tailor their policies so that they look good on the | | | | in a corner and can charge accordingly. If you feel |
| comparison sites. Unfortunately, travel policies | | | | this is the case, it would be wise to check other |
| cannot be reduced to just a handful of 'key | | | | companies because you could cancel the original |
| features', because they vary in exactly what is | | | | policy. |
| included and the definitions used. All travel policies | | | | This is not the biggest problem. Unfortunately, |
| contain holes in cover that you may not be | | | | some insurers are now inserting, and using, a |
| aware of until, or unless, you have to make a | | | | clause in policies that puts the onus on a client to |
| claim. The comparison sites merely tempt insurers | | | | inform the company of a change in health even |
| to produce policies that look good but may have | | | | after booking. There have been instances of a |
| more holes. | | | | client booking a cruise, paying for a single-trip |
| When you buy a travel policy, what you are really | | | | policy and then developing cancer and, though |
| interested in is the medical cover. We all | | | | their doctor gives them the all-clear to travel, the |
| understand the risk of serious illness abroad and | | | | insurer withdraws cover and merely offers to |
| do not want to be bankrupted or stranded | | | | pay the cancellation costs of the cruise. We have |
| without proper care. While the amount of medical | | | | seen a spate of instances of insurers trying to |
| cover varies, normally from £2 million to | | | | withdraw cover when claims looked possible |
| £10 million, the sums are nearly always | | | | (swine flu, baggage at Terminal 5 and threatened |
| adequate; though, naturally, you should look to the | | | | strikes). This attempt is slightly more honest |
| higher limits if you are going to the US. | | | | because at least there is a clause in the policy |
| Some policies will reduce a deductible or give | | | | that theoretically allows it. However, even the |
| some extra, if you have a valid EHIC card when | | | | normally conservative Financial Ombudsman |
| travelling within EU and use public facilities. A few, | | | | Service has expressed concern about the |
| very cheap, policies state that they will only cover | | | | insertion of this clause, which they say puts too |
| private hospitals within the EU when they have | | | | heavy a responsibility on travellers and, in theory, |
| given specific agreement and that you must insist | | | | allows insurers to cancel a policy or invalidate a |
| on being taken to a public hospital. While it is | | | | claim on a whim. If you get a minor pain in your |
| normal for all policies to state that cover is only | | | | stomach a few days before you go on holiday, |
| given once the emergency helpline has given | | | | should you call your travel insurer and, if you do |
| agreement, a few companies have particularly | | | | not, what happens if you then go on to need |
| strongly worded versions of this clause, which | | | | emergency surgery on your appendix? |
| does make it appear as if they are looking for | | | | It is interesting that the Association of British |
| some sort of get-out. It is actually in everyone's | | | | Insurers, which acted to stem the nonsense being |
| interest that the helpline staff become involved as | | | | spouted by a few insurers about swine flu, is also |
| soon as possible since they can ensure that | | | | expressing concern about the use of such clauses. |
| proper treatment is given. However, all the | | | | Quite simply, these clauses go against the whole |
| companies have to accept that if you are in the | | | | principle of insurance. When you buy a policy, the |
| back of an ambulance after a serious accident | | | | insurer is able to calculate the risk of, for |
| you and your companion might have other things | | | | example, a 53-year-old man falling ill while on |
| to think about. Most companies use a phrase like | | | | holiday and charge an appropriate premium. Taking |
| 'as soon as practical' and I think that any | | | | the premium and then denying cover if a claim |
| company that tried to deny a claim would have | | | | begins to look likely is cheating - akin to a |
| to have very serious grounds for them to | | | | bookmaker suddenly refunding bets on Chelsea |
| succeed. | | | | after they have scored the first goal in a game. |
| The real concern - and the big possible hole in | | | | The Association of British Insurers needs to |
| some policies - is not what happens when you are | | | | worry because if this trend continues what will |
| in hospital but what happens when you get out. | | | | happen next - motor insurers suddenly saying |
| If you break a leg and a couple of ribs, your stay | | | | they won't cover any accidents for a couple of |
| in hospital will be quite brief and the medical costs | | | | days because snow is expected or building |
| fairly low. However, you might be declared unfit | | | | insurers excluding flood damage when a storm is |
| to travel for two weeks. That means you have | | | | due? |
| two weeks' food and accommodation to pay for | | | | Defaqto calls itself "Britain's leading independent |
| plus a new air ticket. | | | | financial research centre" and uses a star rating to |
| Most policies will cover these costs and include | | | | rank various financial products. Companies are |
| them in the total allowed for medical expenses. A | | | | inclined to use good star ratings as proof of the |
| fairly normal policy may state that the insurer will | | | | quality of their policies. Do not be taken in by |
| pay for accommodation in a hotel of the same | | | | these ratings. They are based on a similar list of |
| class as originally booked for you and a | | | | 'key features' that are shown on comparison |
| companion and will pay the extra cost of an | | | | sites. They do not use insurers' actual wordings as |
| Economy ticket to return home (or whichever is | | | | a guide and so miss the serious negative points in |
| the cheapest ticket available at the time). Basically, | | | | many policies. |
| this is unlimited cover. Two weeks in the | | | | My advice is simple:o Always read your policy in |
| Caribbean and Business Class flights home for you | | | | full.o Do not rely on 'key fact' summaries of the |
| and a companion (because they were the only | | | | coverage.o Ensure that there is full coverage for |
| seats available at short notice) would blow a hole | | | | additional accommodation and travel expenses |
| in most people's budgets. | | | | after a hospital stay. This can prove to be the |
| You can probably see that these amounts can be | | | | most expensive part of a medical claim.o Watch |
| quite expensive for insurers, so it is very | | | | out for any dangerous catch-all medical clauses |
| tempting for them to cut back as much as | | | | that make you report an illness even after |
| possible. I checked a cheap policy that has the | | | | booking - better to buy another policy if you can |
| same overall medical limit as many others but | | | | find one with more liberal wording. |
| states they will only pay up to £1000 in | | | | Incidentally, you might have seen the adverts for |
| total for a flight home and 'basic' hotel | | | | Hiscox Home Insurance. This is a top-class insurer |
| accommodation. Such a policy appears to be good | | | | that offers a much broader home policy than its |
| value because it pretends to offer the same | | | | rivals do. It claims that a large percentage of the |
| cover as other policies but it does not and could | | | | claims it pays would not be paid by other |
| leave you very seriously out of pocket. | | | | companies. Of course, it charges more, but at |
| I suggest you look carefully at the appropriate | | | | least you know you are getting the most |
| wording on your policy. In the event of accident | | | | comprehensive cover. Hiscox does not offer |
| or illness, this could become important. Virtually | | | | travel cover and, unfortunately, I am not aware |
| every policy will pay medical bills without a hitch - | | | | of any company that offers a similarly |
| but some, seemingly identical policies, could leave | | | | comprehensive package for travel. Most of the |
| you with costs of thousands of pounds. | | | | more expensive policies we see are more |
| There is another serious issue that is starting to | | | | expensive simply because they have higher limits |
| spread amongst insurers and does not seem | | | | and gimmicky add-ons, not because they have a |
| limited to the budget companies. | | | | more comprehensive approach to claims settling. |
| We are all aware of the need to declare any | | | | |