News
Source: Louise McBride, January 27 2019 6:00 PM https://www.independent.ie/business/personal-finance/beware-of-uphill-struggle-to-make-travel-insurance-claim-getting-payout-can-be-an-ordeal-37752332.html
Below
is an article by Louise McBride in independent.ie on 27 January 2019
I
made my first travel insurance claim ever last year - after being in a car
accident in France.
It
was an eye-opener. I was astounded at
the amount of documents I needed to get together to make a claim. This is not
only time-consuming, but on an emotional level I found it difficult to get
these documents together - because it involved revisiting my family's traumatic
experience in France.
Luckily,
my family and I all survived the car crash. I can only imagine how difficult it
must be to get the necessary documents together to make a claim if you have
lost a loved one when on holiday - or if you, or one of your travelling
companions, is seriously injured while abroad.
Another
thing which struck me when making the claim was how difficult it can be to get
a payout - particularly for small claims.
I
made a travel insurance claim to cover the cost of some accommodation which I
had booked and paid for ahead of the holiday - but which my family and I could
not stay in after we were diverted as a result of the accident.
The
claim itself was only for a few hundred euro, so it was relatively small. I
provided our insurer - VHI Multitrip - with various documents to support the
claim.
In
the end though, I didn't get a payout because an excess (the first part of a
claim which you must cover yourself) of €85 was applied for each member of my
family of five - rather than for just one of us. This brought the total excess
for our claim to €425 - which was more than the loss I was claiming for.
When
a family is making a claim - particularly to cover the cost of a single bill
(such as holiday accommodation), surely it would be fairer for only one excess
to be applied for the entire family than to have an excess applied for every
person in the family?
I
put this point to VHI MultiTrip and a spokeswoman said: "To help keep the
policy at a fair price for all customers, we have agreed an excess with
underwriters. All of the cover on the policy is applied per person, except for
a few sections that have overall policy limits, so the excess is applied per
person."
Personally,
I would prefer to pay more for insurance and be covered - than to pay a 'fair'
price and not be covered.
The
spokeswoman added that it is possible to buy an optional excess waiver add-on
when buying insurance. With this add-on (which costs extra), you would not be
hit with an excess when making a claim.
Luggage
claims
I
had considered making a travel insurance claim for lost and damaged belongings
as a result of the accident - but decided against it when I saw the extent of
documentation required. To be able to claim for lost or damaged personal
luggage or belongings, you must provide proof of ownership. This can be
difficult.
For
example, with VHI Multitrip, you must provide "receipts or similar
documentation for the items you are claiming for as evidence of value and
ownership. Similar documentation can include bank statements showing purchase,
original packaging for item, or a photo showing the items in question."
Other travel insurers have similar rules around this.
Our
car accident happened shortly after our arrival in France for a two-week
holiday - while we were en route to our camp site.
Like
any other family travelling with young children, our car was packed to the brim
with luggage at the time of the crash. Much of our luggage was strewn across
the motorway after the crash.
We
salvaged most of our luggage immediately after the accident. But once the
gendarmes arrived on the scene, we weren't allowed to check our car for other
belongings. Our car was a write-off and was towed away and eventually scrapped.
We
were in such a state of shock at the time of the accident that it was only
after we had returned to Ireland that we started to remember some of the
belongings which we had left in the car.
Some
of the items which were left in the car were old; some were new. Some were
valuable; some weren't. Some items had been bought with cash rather than card.
We certainly didn't have receipts for, or photos of, everything in the car.
Neither did we have a list of all the items in the car. Who does? Who packs or
prepares for an accident when going on holiday?
Who
has the ability to think straight after an accident - and to therefore be in a
position to take photos of damaged belongings?
Injuries
& Health
Thankfully,
I had packed our European Health Insurance Cards (EHIC) for our holiday - so
most of our French hospital bills were covered by those cards and I did not go
through my travel insurance for that. (The EHIC lets you get public healthcare
in another EU or EEA state for free, or at a reduced cost.)
We
weren't robbed when on holiday, but if you were to make a travel insurance
claim as a result of a robbery, you must usually report the theft to the local
police within 24 hours.
You
must also usually get a written report from the police about the theft - and
you will need to submit that report with your claim.
These
might seem like reasonable requests, but what happens if you're stranded in the
middle of nowhere after being robbed when on holiday - and you can't get to a
local policeman within 24 hours? What happens if you're too badly injured or in
shock to even consider going to a police station? Even if you can get to a
police station, what happens if there's a language barrier and you therefore
can't ask for a written report - or indeed, if the police refuse to provide you
with one?
In
our case, for example, the gendarmes refused to provide us with their written
report about our car accident. We were told there were only two copies of the
report -one for the French police and one for the French judiciary.
Should
you cut short your holiday because of health problems, you must usually provide
your travel insurer with documentation from the doctor who treated you abroad,
stating why it was medically necessary for you to return home.
Should
you cancel or cut short your holiday as a result of the death of a loved one,
you must usually provide your insurer with the death certificate of your loved
one if making a claim. Some people might find it too traumatic to even look at
a death certificate after the loss of a loved one - never mind handle it for
the purposes of making a travel insurance claim.
"Where
there are specific requirements or exclusions in the terms and conditions [of
VHI MultiTrip], this is in order to validate claims, minimise fraud and to
protect the pricing for all customers by ensuring only claims that were
intended to be covered are paid," said a spokeswoman for VHI MultiTrip.
"This is for the benefit of the customer base as a whole and is also
required to meet contractual and regulatory requirements."
The
spokeswoman added: "All claims are reviewed within the terms and
conditions of the policy and claims handlers are required to assess claims
based on the policy terms and conditions.
"For
the majority of cases, this includes gathering supporting evidence to validate
the claim is covered within the terms of the policy and also provides an audit
trail to evidence that the claim has been paid correctly. For example, if the
policy states that cover applies subject to the incident being reported to a
relevant authority or service provider to record the cause of the loss, the
role of the claims handler is to get the appropriate documentation to evidence
that the policy wording was adhered to."
I
will continue to buy travel insurance before holidays - because I know how
quickly things can take a turn for the worse when abroad and because it is
prudent to do so. Medical bills can be huge if you're injured or in an accident
abroad - without travel insurance, you could be in a precarious financial
position if things go wrong.
My
family and I all survived that accident and that matters more to me than any
payout I would get from travel insurance. All the same, I believe that there is
a lot of work to be done to make travel insurance simpler and easier to
understand, that excesses should be fairer (if applied at all) - and that it
shouldn't be such an ordeal to make a claim.
WHAT
NEEDS TO CHANGE WITH TRAVEL INSURANCE
Policies
must be simpler
I
have been writing about personal finance for 17 years, and I still find it a
challenge to read and understand travel insurance policies. I imagine it is
even more of a challenge for many others — particularly those not familiar with
insurance jargon and financial terms.
Many
of us simply don’t have the time or inclination to read a travel insurance
contract in full. Yet, to know exactly what you’re covered for — and when and
where you’re covered, you need to read and understand a travel insurance
contract in its entirety. This is not easy. Travel insurance contracts are long
and complicated.
As
with any insurance, when you buy travel insurance, you have no idea what might
trigger a claim. So even picking one or two sections out of your policy which
you feel will be most relevant to your trip — and concentrating on
understanding those sections — may not be enough.
The
Central Bank said that its consumer-protection code has rules to ensure that
financial products (including travel insurance) are understood by consumers and
that claims are handled fairly. However, this code was introduced more than 10
years ago — and the majority of travel insurance contracts are still far too
long and complicated. A spokeswoman for VHI Multitrip said that “there is a
project under way to look at simplifying the VHI Multitrip policy document and
reducing the length”.
Copies
should be okay for claims
Another
difficulty that people may run into with travel insurance is that they may have
to submit original documents when making a claim as their insurer might not
accept photocopies.
However,
there are a number of original documents that people might be reluctant to send
to an insurer — particularly if it’s a sensitive or valuable document, such as
a death certificate or a police report of a theft or accident. Most travel
insurers require death certificates to check the validity of a claim which has
arisen following the death of a loved one or travelling companion. A
spokeswoman for VHI Multitrip said that “it will be moving away from the need
for customers to provide original documents”. She added that VHI Multitrip is
working on rolling out further developments around online claiming, where
customers can submit scanned copies or photographs of documents when making a
claim.
Phone
calls should be covered
When
you’re involved in an accident or emergency abroad, you’re likely to run up an
expensive phone bill. You’ll typically call your insurer, emergency services,
and your family. You might call the Irish embassy or others for advice. You’ll
make other calls to try to organise yourself after the incident. Phone calls,
however, may not be covered by your insurer.
VHI
MultiTrip, for example, doesn’t cover the cost of telephone calls. Blue
Insurance covers the cost of certain phone calls, such as calls to emergency
assistance services — as long as you can provide receipts or other evidence to
show the cost of the calls and the numbers telephoned.
Excesses
should be fairer
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