The big chill: how insurance changes could hurt holidays
WORRIED about your holiday? Well, now you’ve got another headache. In addition to all of the cancellations, the refunds and voucher confusion and the uncertainty about whether holidays will even go ahead this year, you can add travel insurance to the mix.
Growing numbers of insurers are ceasing to cover coronavirus-related cancellations on new and renewing travel policies. This essentially means new policies won’t cover trips booked now against cancellation due to Covid-19 outbreaks or related restrictions in the future.
This is only the beginning. With claims cascading in, travel insurance prices are likely to rise, Covid-19 cover is likely to become a general exception across the board and, in the future, won’t even be available as an expensive or premium add-on.
That is, until there is a reliable treatment or vaccine in play (a caveat that seems to apply to everything these days).
Could this have a chilling effect on our desire to travel, or book holidays, in the months ahead?
“Think I’ll save myself the money and cancel the policy,” as one reader tweeted me this week.
I see their point. Our heads are already spinning at the thought of airport tests and temperature checks, of physical distancing and in-flight face masks. We’re anxious about our safety on holidays. The last thing we look forward to is a deep dive into travel insurance T&Cs, especially if we know they already exclude Covid-19.
Such a chill would, of course, be yet another blow to a devastated holiday industry.
Hotels and airlines are working furiously to develop hygiene and safety protocols to reassure people about travel, when it is safe to do so. Tourism provides one in 12 European jobs. Irish travel agency employees are champing at the bit to sell holidays again.
It’s also true that booking a holiday is a complex calculus. We weigh up all kinds of things before pressing that button – health, safety, price, availability, weather, booking T&Cs and, yes, insurance.
Before Covid-19, up to 30pc of Irish people travelled without insurance
From the insurers’ point of view, the risk of Covid-19 cancellations is so extreme, retaining cover could mean policy price hikes of hundreds of euro. Why bother with such a risk? And who would pay those prices anyway?
Insurers get a lot of flak, and they haven’t necessarily covered themselves in glory during this pandemic. However you see it, making Covid-19 a policy exception isn’t going to incentivise travel. It’s also possible that we’ll see price rises for older travellers, those with pre-existing conditions, and exclusions for other (or all) pandemics.
But we travellers need to ask ourselves hard questions too. Even before the Covid-19 pandemic, up to 30pc of Irish people routinely holidayed without insurance.
That was stupid then, and it remains stupid now.
Accidents, theft, injury, illness and disruption are just a few of the nasty things that can happen on holidays. We need to protect ourselves and our families against them.
And just as Covid-19 will teach us to look more closely than ever at cancellation T&Cs on booking contracts, so we need to read the fine print and be prepared to pay fair rates for cover that meets our individual needs – from winter sports to medical conditions.
It’s just a shame that cover will no longer protect us from the thing we fear the most: Covid-19.