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Adopt a Common Approach to Medical Warranties
It is little wonder that consumers get confused as to whether they should be declaring medical conditions or - indeed - whether there is any cover at all given the fact that every travel insurance policy has a different form of words on this very important part of the policy. Common declarations are the norm on other classes such as Motor and Household so why not on Travel?
Take the Meanness out of Exclusions
Some Insurers, in an attempt to get premiums to the absolute lowest level, use a strategy of harsh exclusions which inevitably trap people at the claims stage. Examples include, very strict interpretation of unattended personal effects, valuables and money as well as the requirement to obtain written Police reports, even though it is generally accepted that these are very difficult to get.
Make Wordings Clear and Concise
Insurers always complain that people do not read their policy wordings but if they are 50+ pages long this is hardly surprising. Also, in an increasingly e-commerce driven business, expecting customers to print out at their own cost reams of paper is unrealistic at best.
Stop Selling Policies with very high Excesses
The higher the policy excess the lower the premium can be. This is quite obvious to customers on the likes of Motor Insurance and Pet. Travel Insurance is less obvious until a medical claim is made and the customer finds most – if not all of their claim – falls within the excess. We are now seeing policies with excesses on the medical section as high as £400 and yet the cost saving to the customer may only be a few pounds against a more standard excess of £75/£100.
Consumers Can Play Their Part too ……..
However, consumers also need to adjust their behaviour too! In 2010, we really urge people to make sure they read the most important parts of their policy document – specifically the medical warranty and how it relates to their circumstances or somebody who may affect their travel (i.e. non-travellers). We also suggest that people don’t simply buy the cheapest travel insurance policy unless they fully understand what they are buying. In this market, if the price looks too good to be true it probably is!
And for Government (new or existing)
It is high time that the unjustified higher rate of Insurance Premium Tax on travel insurance is brought down from 17.5% to the same as other classes of business such as motor and household at 5%.
And finally one for the Regulators
In the interest of Treating the Customer Fairly take a close look at how insurance is sold online to ensure that the customer is presented properly with all of the information which enables them to make a fair judgement about what they are buying.
Probably wishful thinking but certainly something for all those involved in this market!
P J Hayman & Company Limited
Telephone: 0845 230 3526
Fax: 023 9241 9019
E-mail: travel.insurance@pjhayman.com
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