Be Careful Buying Travel Insurance

Travel insurance is no simple purchase to leave to the last minute. That’s how people get into trouble. You need to pay attention to the details. You can’t just hand over your credit card number, stick your unread policy in your desk drawer and fly away.

You’ve heard lots of stories about people whose travel medical claims have been denied because they made a mistake or two on their application, or they didn’t understand some medical term, or they forgot to tell the agent about some new pills they were prescribed. To them, these were minor slips. To the insurer, they were misrepresentations. Either way, the results could be tragic.

You can’t afford to leave Canada for even a day without travel insurance.  But neither can you afford to

buy the wrong kind of insurance for your particular need or condition. It’s better to have no insurance and be aware of it, than have a plan that doesn’t fit you and be unaware of it. At least then, you know where you stand.

How to Make Sure You Buy the Right Insurance. 

We know you’re not going to read the whole policy; that would be almost impossible. Most insurers are either incapable or unwilling to use plain language.  They use legal jargon, mostly to protect their own interests.

But you need to read certain parts:

Eligibility Requirements. You may have to answer questions concerning your age and health status, medications you have been prescribed, conditions you have had treated within a certain time period before you applied, tests you have undergone. This can be quite a lengthy questionnaire, but don’t hurry through it. If there are any words you don’t understand, or if you’re not sure why you’re taking a certain medication or why you were referred to a specialist, you must ask your doctor and enter the correct answer. If you miss even one eligibility requirement, your insurer might consider you ineligible after the fact and nullify your policy after your claim has been submitted.  This is not unfair, as the insurer will claim that if it had known about your condition it would not have offered to cover you. And that applies whether or not that condition had anything to do with the emergency that generated your claim.

Example: If you were hospitalized with a heart attack and your insurer finds out later that you failed to disclose you had a gall bladder operation in the past year or two, the insurer could nullify your claim.

What did the gall bladder have to do with the heart attack?  Nothing. But you failed to disclose your medical status and the insurer has every legal right to nullify your claim.  Moreover, the courts seem to favour the insurer in such cases.

Exclusions and Limitations.  If you read nothing else, read all of these clauses: they tell you what the insurer will NOT cover. This section will usually be included after you have read about all of the benefits, which in Canadian plans are generous. For example: travel insurance will not cover pre-existing conditions that are not stable. It will not cover, elective procedures, or non-emergencies, or continuing care of conditions that have already been treated, or acts of war. And you need to very carefully read the definitions of these terms as well.

Definitions. Understand that terms and words used in policies mean what the insurer says they mean, not what you or your dictionary or even your doctor says they mean. Key definitions are listed in all policies.

The ones you need to know are:

  • pre-existing condition,
  • stable or unstable,
  • emergency,
  • treatment.

It would help if all, or even most travel insurers used standardized definitions, but they don’t. Their definitions vary, sometimes quite a bit, so you need to understand the differences. Sometimes your doctor may tell you he or she considers your condition stable, but that may not be enough for the insurer. It’s the insurer’s definition that rules.

Medical underwriting. If you can’t meet all of the eligibility requirements by answering either Yes or No, to a series of questions, you may still qualify for coverage under a medically-underwritten policy which is based on a more detailed medical questionnaire. But do not consider this a formality. It is serious business and you may need information from your doctor to help you complete this accurately. It requires precision, because if you generate a claim, the insurer will investigate your medical records going back several years. If there are discrepancies between your doctor’s notes and the information you provided on your questionnaire, your claim might well be denied on grounds of non-disclosure or misrepresentation.

There are claimants who say their doctor never told them what was in their medical record, or why they  were prescribed certain drugs, or given the results of tests, so they shouldn’t be held responsible for the answers on their questionnaire. But that’s no defense. It’s true, doctors don’t always communicate well with their patients, but it’s your responsibility to make sure they do. The information you provide on your medical questionnaire is all the insurer has to rely on in deciding whether or not to insure you so it must be accurate and complete. The best practice is to make your doctor aware of your need to be fully informed about everything in your medical record.

If you require medical underwriting, involve your doctor in the completion of  your application—even if you have to pay to do it.

The bottom line is that you are responsible for your medical application, whether you fill it in on your kitchen table with a pencil, online through your computer, or via the telephone with an agent taking down your responses at the other end. Before you sign your form and hand over your money or your credit card, thoroughly review your answers and see they are correct. Don’t let somebody else’s error cause you grief later on.

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