VHI accused of 'sharp practice' on travel cover
Published 01/06/2011 | 05:00
Ann Fitzgerald: National Consumer Agency chief
VHI has been accused of sharp practice after it emerged it is refusing to refund people who had their travel insurance cancelled when they stopped getting health cover from the company.
VHI offers competitively priced travel insurance, but only to those who already have VHI health insurance cover.
Those who drop their VHI cover -- either because they cannot afford it or because they are switching to rival health insurance providers Aviva or Quinn -- automatically lose their travel cover.
Many of those who have had their travel cover cancelled still have months to run on their policies. They were not informed they had lost their travel insurance cover and were not refunded the money, even though the cost of the policy has to be paid for 12 months in advance.
Consumers' Association chairman Michael Kilcoyne accused VHI of "sharp practice".
"You would expect higher service standards from a semi-state company. This is sharp practice," he said.
He said thousands of people who had the VHI's multi-trip travel insurance would have switched to other providers or stopped paying health premiums altogether.
Some 14,000 people cancelled their health cover in the first three months of this year, while 50,000 people dropped their VHI health cover last year.
These people were due a partial refund, at the very least, Mr Kilcoyne said. He encouraged anyone who had lost their travel insurance to take their case up with the VHI. If they were unsuccessful they could complain to the Financial Services Ombudsman
The revelation that the VHI was refusing to refund premiums for those who lost their travel policy comes a week after it emerged that the VHI has been charging a €50 cancellation fee to those who switched health insurers midway through 12-month contracts.
A VHI spokeswoman said: "In the past, if a member cancelled their VHI Healthcare hospital plan, their multi-trip policy was automatically cancelled too with no refund.
"This was something we clearly highlighted in our terms and conditions and marketing materials."
But she stressed that the company had changed its policy and would allow people who had health insurance with either Quinn or Aviva to avail of the VHI's travel insurance.
Meanwhile, the need for people to check that they have not lost their travel insurance was emphasised by the National Consumer Agency (NCA) yesterday.
NCA boss Ann Fitzgerald said: "If you had travel insurance as a benefit with another policy, and you cancelled the main policy, your travel insurance may have ceased.
"So always check with your provider to see if you are still covered."
The agency, which said some 300 complaints about travel insurance policies were made last year, has issued a guide for those buying travel insurance.