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.
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
Even if your claim is valid, there may be no point making a claim because of the excesses on your policy. This should not be the case. Excesses should be fairer and lower.
Sunday Indo Business