Denial of Travel Insurance Benefits

An Australian businessman who had been living in Vancouver for two years, recently had his travel health insurance claim denied when he became ill in Mexico.  The man had purchased travel insurance from a U.K. company before leaving on his vacation.   He was rushed to a Mexico hospital when a perforation of his intestines resulted in blood poisoning and subsequently, he was placed in a medically induced coma.  The man apparently did not reveal on his health insurance application that he suffers from Crohn’s disease, and as a result, after two days in hospital his insurer denied him coverage.  With medical bills already in the $100,000 range, the costs to airlift him to Australia where he has coverage, would be another $100,000.

This Australian man is certainly not alone in finding himself burdened with medical bills arising from a vacation illness or mishap, running into the hundreds of thousands of dollars. Most Canadians traveling abroad purchase travel health insurance in order to make sure that they are covered in the event of an accident or illness, but many of us do not take the time to read and understand the policies prior to purchasing them. Travel health insurance companies will gladly take your money but rarely take the time to go over all of the terms of the contract with you. Most policies are written in very complicated terminology and confusing clauses in fine print which identify exclusions and create reasons for the insurance company to deny a claim. If an insurance company denies a traveler's claim for benefits the policy owner will be expected to pay and that can turn your dream vacation into a nightmare and leave innocent people in financial ruin.

Canadian insurers will generally cover a chronic condition that is stable and has been divulged in your application. However, you need to get clarification from your insurer on how much time is needed before a condition is considered ‘stable’. The insurer doesn’t care if your physician said you were okay to travel and ‘stable’; rather, they rely on their own timeline which is usually between three and six months.

Be aware that even a small change in a regular prescription may be counted against you by the insurance company, with respect to the time when your condition is stable.   For example, if a prescription for blood pressure medication was even slightly altered, your condition would only be considered ‘stable’ since the date of your changed prescription.  Of course, you need to disclose all prescribed medications on your insurance application as well.

A pre-existing condition can be defined as any illness, disease, injury or other medical condition that exists or occurs before the effective vacation date, and for which the person had symptoms and sought a diagnosis, treatment or received new or altered prescription medications.

The most common reason for denying a claim is that the application was incomplete and the claimant did not reveal some of their medical history or a pre-existing condition.  You are generally not covered if you have a pre-existing condition which was not documented on your health insurance application.  In revealing a pre-existing condition, you will generally be required to pay a higher rate, which means that for people aged 55 and older (who are more likely to have a condition such as high blood pressure) health insurance costs can begin to increase significantly.  However, it’s better to be safe than sorry and pay the extra amount to ensure coverage if you need it.

Vacationers must also keep in mind that some sports or extreme activities may not be covered by their travel health insurance policy.  If you become injured while hang-gliding, bungee jumping or even, snowboarding on your vacation, resulting injuries may not be covered.  Also, some policies require certification in order to have coverage, such as for scuba diving.  If you are considering any high risk activities during your holiday, check with your insurer to determine what their standard policy will cover.

In order to pay for medical costs, creditors may attempt to seize your home, vehicles and other personal assets.  Whether they are a retiree on a fixed income or a young adult with limited resources, many individuals are reluctant to fight a large insurance company who is denying their claim. That is what the insurance company is banking on. If your insurance claim is denied and, as a result, you are faced with large unpaid medical bills, call the insurance lawyers at the ILO Group for a free consultation.   You have everything to gain if there is a chance that your lawyer can negotiate payment of your medical expenses.

Keep in mind that if you make a claim for medical expenses, particularly in the case of a large claim, insurance companies will request all of your medical records from your physician(s) and research far back in your medical history to look for inconsistencies in your application and/or an undisclosed detail in your records. An incomplete or inaccurate application, and failure to reveal a pre-existing condition (even one you weren’t aware you had) are after all, the most common grounds for denial of a claim.

The timing of treatment for your illness can also be an issue that causes an insurance company to deny your claim. A policy questionnaire will often ask you if you have been treated for a condition within the past 12 months but fail to make clear which previous 12 months; is it from the date the coverage begins or the date of your application? The insurance company will then use that ambiguity in their favour in selecting the start date and thus denying your claim. Travel health insurance companies can also require you to undergo only a minimum emergency treatment abroad and then force you to travel back to Canada at the earliest date where you will be covered by your provincial plan. Your travel health insurance will then be cancelled leaving you unable to complete your vacation.

If you have had a claim denied you'll need an experienced and knowledgeable lawyer to represent you against the insurance company. Insurance companies generally expect claimants to accept their decision to deny coverage, but when challenged by a lawyer, may be amenable to settle out of court for the full or a lesser amount. If it can be proven that they are in the wrong, they must pay your claim in its entirety. Speak with an attorney from the ILO Group today and show the insurance company you are serious and expect your travel medical bills to be paid in full. We are a team of zealous advocates for your rights and have the experience to successfully challenge travel health insurance denials.