Everybody has heard the horror stories: An evil travel insurance firm denies the claim of another decent individual. Here is a latest example: An 80 year old man went on a cruise and accumulated $107,000 in medical bills immediately after he fell sick with pneumonia which led to complications. The insurance company denied his claim. (As you most likely guessed, lawyers ultimately got involved). Many stories like this have numerous folks believing that insurance firms Never pay claims. So the question is: Is travel insurance just a huge scam? The short answer is no, but there are undoubtedly factors you need to know to support steer clear of becoming an additional tragic story.
Very first off, travel insurance is usually a great kind of insurance to purchase. “Excellent insurance” signifies paying a reasonable upfront premium to transfer a significant financial threat from oneself to an insurance company. By contrast, extended warranty on your iPod can be regarded “bad insurance” simply because the premiums are expensive and a broken iPod, although annoying, will almost certainly not ruin you financially. Since healthcare charges are really high-priced (i.e. the average hospital keep in Canada expenses $7000 a day) travel insurance is a wise way to protect yourself from the possibly crippling fees of a healthcare emergency.
Of program that all depends on the insurance business in fact paying a claim when the time comes. Claim payout rates in the insurance market are extremely guarded, but there is some anecdotal info obtainable. In a latest write-up by the Chicago Tribune, the US Travel Insurance Association indicated that roughly one in six policyholders file a claim, and fewer than 10 % of these claims are denied.1 According to Canadian insurance broker Travel Insurance Workplace Inc, around 9% of travellers have a claim, and significantly less than 7% of those claims are denied.2
So it looks like there is at least some evidence of insurance businesses paying out claims. But how can you make positive an insurance firm will spend YOUR claim, without having acquiring expensive lawyers involved?
1 way to guard yourself is to really feel like a attorney when purchasing travel insurance. No, you don’t need a law degree from Harvard, but you do have to understand that an insurance policy is a legal contract. If there is a claim, the insurance business is going to go back that contract, which includes your insurance policy and any applications or questionnaires you completed.
In the insurance planet, claims are really black or white, yes or no, covered or not covered. With that in thoughts, here are some ideas to support keep that dreaded “denied” stamp in the insurance company’s holster:
Read the policy: Contrary to well-known belief, not everyone who functions for an insurance company is evil. When a claim is denied, some insurance insiders sincerely wonder: “Didn’t they read the policy?” A lot of claims are denied simply because the policy specifically excludes the item in a section appropriately called “Exclusions.” Other denials are due to claims that are simply not covered by the policy, or the amount claimed is much less than the policy’s deductible. The lesson? Read and recognize the policy before you buy.
Answer the medical concerns truthfully and fully: Sadly, a lot of medical questionnaires are often lengthy and confusing. To fill out the questionnaire completely and accurately, you might want to seek the advice of your medical professional, pharmacist, or a relative who knows a lot more about your healthcare history. Don’t leave your travel insurance to the final minute. The majority of claim denials are a outcome of men and women rushing via the questionnaire, or not inquiring about items they were unsure of. A single insurance agent remembers asking his client, “Do you have higher blood pressure?” The client’s answer, “No. The 3 medications I take hold it normal.” Don’t forget, how you define terms is irrelevant, it is the language in your insurance contract that counts.
Pre-existing situations: A lot of plans cover pre-existing situations that are stable and controlled. However, you need to have to read how “stable and controlled” is defined in your policy contract. For example, a condition will not be regarded as “stable” if you modified your medication in any way recently. Speak to the insurance organization directly if you have questions. Non-disclosure of healthcare info can void your coverage even if the non-disclosed circumstances or symptoms have nothing to do with the circumstances causing your claim. In the example above involving the man on the cruise, the insurance company denied the claim because he failed to disclose a prior heart condition in his application.
Advise the insurer of any healthcare modifications prior to leaving: If you have currently bought your travel coverage and your wellness alterations in any way just before the date the policy goes into impact, you ought to notify your insurer. A wellness adjust in the interim may well invalidate your coverage.
If you do get denied, fight it: There are no guarantees in life, and even the most carefully completed policy application can outcome in a claim denial. Regardless of the purpose, never accept the denial without a fight. The insurance organization owes you a clear explanation, and make positive to get it in writing. Particularly ask for the a comprehensive explanation of why the claim was denied, which components of the contract had been supposedly contravened, and how you can launch an appeal. If all else fails, a attorney may possibly have to get involved to argue your situation.
Travel insurance is definitely worth getting, and the evidence appears to show that insurance firms do pay out in time of require. However, applying for travel insurance does take some work. Following these tips will at least lessen the probabilities of obtaining a dreaded claim denial.
Sources: (1) “Travel insurance claims can hinge on the tiniest specifics” Christopher Elliott. chicagotribune dot com. Could 22, 2012. (2) Winter/Spring 2012 Newsletter. travelinsuranceoffice dot com.