Given recent developments concerning the rise in reported cases of coronavirus worldwide, the outbreak is stoking fears among travellers. Many are wondering whether travel insurance will protect them in case they cancel their trip, become sick while abroad, or if their flight is grounded.
So how do you know what you have cover for? It helps to find out ahead of time what is and isn’t covered.
Cancellation coverage? Don’t count on it
Tour operators are reporting an increasing number of requests from customers asking to change their travel plans. Meanwhile, many airlines are changing their flights on a daily basis as the virus begins to spread.
A travel policy probably wouldn’t cover you
Most travel insurance is designed to protect you in case you need to cancel a trip, lose belongings, or require medical attention. But for cancellations related to coronavirus, only certain reasons qualify. Here are some examples:
Airline cancels flight: Not usually coveredReimbursing a cancelled flight is generally the responsibility of the airline — not the insurer. The same goes for cruise lines, rail companies, or any other transportation provider that cancels because of coronavirus or any other reason.
Traveller chooses to cancel a trip: Not coveredTravel insurance will cover consumers who have to cancel their trip for reasons including adverse weather, a natural disaster, jury duty, an act of terrorism, or the travel company going out of business. But it won’t protect travelers who cancel because they are worried about the coronavirus.
Traveller contracts coronavirus and has to cancel: CoveredTravellers are protected if they have to cancel a trip because of personal sickness or injury, or the sickness, injury or death of an immediate family member.
Quarantine: CoveredMost standard policies will cover cancellation or interruption if the traveler is placed under quarantine, or if the destination is placed under a mandatory evacuation.
Although standard policies don’t cover all cancellations, some travel policies offer “cancel any reason” provisions or flight delay benefits that will provide reimbursement. Again, here’s where reading the fine print comes in.
Illness protection — it’s in the detailsThe good news is that most policies protect travellers who become sick while abroad. But the details of the policy matter.Travel insurance is intended to cover medical costs abroad. As long as the policy includes medical coverage, the traveller is protected should he or she require medical care, hospitalisation, or a medical evacuation while in a foreign country.
But travellers need to understand the stipulations of their policy from the outset. Here are some considerations:
LimitsAll policies have a maximum they will pay, and many also have deductibles and other limitations.
Exclusions Policies may exclude coverage for certain situations, such as risky activities. So thrill-seekers like skydivers and bungee jumpers might be out of luck.
In most cases, a standard travel policy is sufficient. There are several types of policies with different levels and coverage for all sorts of travel. Some policies may be specific to cruises, where it may become critical to evacuate to a hospital. Other policies are geared more toward adventure travel.
Reality checkThe headlines may paint a scary picture of the coronavirus, but it helps to keep facts and figures in perspective.
Travellers planning a trip may want to give more thought to their insurance coverage.
The key is to determine their actual risk, understand what they are trying to cover, and then find a policy that accomplishes that.
Would you like a review of your travel insurance arrangements?
Please contact Matt Price, Broking Director, Ascend Broking Group firstname.lastname@example.org