If you’ve ever had a travel insurance claim denied, you know how frustrating it can be to get an answer in plain language that tells you why an insurer won’t pay.
First of all, let’s get one fable taken care of: Insurers do not routinely deny claims and pay only those for clients who fight back. 95 percent of all travel insurance claims submitted are paid.
But if you are among the unfortunate few to receive a claim denial letter and you don’t understand why, you should ask for clarity. It’s your right.
What to do
Get right back to the insurer, or the party that sent you the denial letter (it could be the insurer’s assistance company), and ask for a detailed, written report that you can study at your leisure, or take to your doctor. Ask to have key words—such as “pre-existing condition,” “stable,” “condition,” “exclusion,” “eligibility,” and “non-disclosure,” clearly explained. And remember, it’s the way those terms are explained in the policy that governs the terms of your coverage.
Obtaining a letter from your doctor saying your heart rhythms or your COPD or your gastrointestinal symptoms are stable and you are “cleared” to travel may not be good enough. Family physicians don’t always tell you everything that’s in your medical charts, and they are not aware of the definitions of those key words in your policy. They may not want to burden you with something they can’t do much about, or they may not want to spoil your vacation. And it may be just that information that the insurer needs to be able to properly asses the risk of insuring you.
Where to go
If the insurer’s explanation does not answer your questions to your satisfaction, or if you still feel you didn’t get a fair response, ask for a review and assessment by the insurer’s designated ombudsman or dispute resolution person. All insurers in Canada should have such a resource. Always go there first. If you don’t, or if you are still convinced you have not been treated fairly according to the terms of your policy, you can present your case to the OmbudService for Life and Health Insurance or the Canadian Life and Health Insurance Association.
Know that the Ombudsmen Service and Canadian Life and Health Insurance Association will require you to first deal with your insurer and/or the insurer’s independent ombudsman or resolution service to address your case.
Some provincial governments may also have dispute resolution services: in Ontario, for example, the Financial Services Commission of Ontario (FSCO) has long experience in dealing with travel insurance denial complaints.
Prevention is the best remedy
In the vast majority of denials, the problem lies with the customer’s failure to understand the terms of coverage, the technical or medical language in applications, and the policy itself (which is a problem insurers need to deal with). Canadian insurance regulators have directed them to do so, and there are signs they are trying to comply.
Buying insurance is serious business. You’re not just risking a few hundred dollars in premiums by buying something you don’t understand. Denied claims can ruin your finances.
If you have any medical history that requires medication or even occasional visits to your doctor, avoid the easy, quick purchase that promises the cheapest possible premium in the fewest possible minutes.
Deal with a trained agent who knows, preferably specializes, in travel insurance, and take your time.
Talk to your insurance provider about options for your pre-existing conditions today.