Does travel health insurance have your back?

Even reading fine print, you can’t be sure, Jim Garner says.

Next winter, I plan to join many of my fellow old-age pensioners on the shores of the Mediterranean. No snow to shovel, warm days, excellent three-course meals with wine for $9 to $19. Sure, we ancients have to scratch and save all year to pay for it, but it’s worth it.

There’s just one little niggle: What if sickness strikes?

There’s travel health insurance. But scores of people who think they have bought insurance against accidents or illness while travelling find their claims denied. In extreme cases, this can cost them tens of thousands of dollars.

The main problem is the application for insurance that has the client fill in a form about his or her medical history. The form’s wording can be interpreted in different ways; even a doctor can’t be sure what to put down. Is the client really insured? According to Dr. John D. Allingham, a retired ER physician writing in the journal Canadian Family Physician, “It is only when clients successfully make claims that they know that they have been covered.”

An example: One client was Mrs. T (name withheld in the official report on her). She became ill while travelling and ran up a big hospital bill. The insurer declined to pay, arguing she had not disclosed that she was taking medication for hypertension. In fact the medicine, although often prescribed for hypertension, was in this case for stroke management, which was covered.

Her doctor provided confirmation but the insurer wouldn’t budge. At this point many clients, faced with the well-heeled legal department of an insurance company, would just give up. Not Mrs. T. She contacted the Ombudsman Service for Life and Health Insurance (OLHI), an independent body set up under federal law. There was much back-and-forth, but in the end the insurer paid up.

There’s a certain conflict of interest within insurance organizations. There are personnel

What honest citizens need is clearer language in those application forms.

anxious to make a sale — perhaps tempted to oversell and assure prospects that they really are insured — and there are adjusters, whose job it is to look at a claim (and very thoroughly they do it, going back into medical records for years). These two entities are separate departments, often even separate corporations. What one says, the other can rebut. And it happens.

True, some clients do conceal medical information to get cheaper insurance, and insurers have to protect themselves. But what honest citizens need is clearer language in those application forms. The insurers say they’re working on this; I haven’t seen much clarification yet.

Health-care costs in the United States are excruciatingly high — two to three times what they are elsewhere — and in all forms of insurance, the industry matches its charges to the risk involved. Does this mean premiums for travel to, say, Europe are half those demanded of Florida-bound travellers? The answer is no. Most travel insurers base their rates wholly on U.S. costs. A few offer a risible 10 per cent off for those journeying to cheaper destinations.

So what can be done? There are two possibilities: Either government can get involved, or the insurers can clean up their act.

Provincial plans could easily offer travel health insurance as an optional extra. Governments don’t have a great record of running commercial enterprises, but they do well with insurance, whether it’s for crops, unemployment, industrial accidents or, in Saskatchewan, British Columbia, Manitoba and Quebec, autos.

The insurance industry isn’t going to like this. So how about a compromise? Say, a scheme (regulated or industry-mandated) that has the insurer nominate doctors who would, for maybe $100 or so, vet an application and certify it to be accurate. The companies would be required to accept this certification. The insurers would then be selling a better product that offers genuine peace of mind — which they are not doing now. And the public would be better protected.

In my winter travels, I have often met Canadian pensioners who just don’t take health insurance; they say it’s expensive and totally unreliable. I agree. But given realistic improvements, I’d be glad to do business with the insurance industry.