Travel insurance policies are designed to insure the potential for loss from a single trip from the traveler’s home country—even if that trip involves multiple stopovers.
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British family may be on the hook for a hospital bill in excess of £100,000, reports the BBC.
The bill–just over $125,000 at current exchange rates–occurred after the traveler had a long hospital stay in South Africa in February 2022. In that case, the traveler had extended her original trip from the United Kingdom to Kenya. The family had already insured their Kenya trip, so they purchased an additional policy for their daughter to extend her journey to South Africa.
But the insurer refused responsibility for the traveler’s hospital bill, citing irregularities in the application for their insurance policy. The insurer, AXA, claims that the policy is invalid because the family provided incorrect information, saying the traveler departed the United Kingdom on a date that she actually departed from Kenya for South Africa.
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The family disputes this, saying that the journey began in the United Kingdom.
AXA disagreed, refunding the policy, which it declared to be invalid.
In the most technical of terms, the insurer may be correct, particularly if the policy’s trip date began on the date the traveler departed Kenya, and not the United Kingdom, for her journey to South Africa.
Travel insurers depend on accurate information in applications to determine the appropriate cost for coverage to a traveler. The policies are designed to insure the potential for loss from a single trip from the traveler’s home country—even if that trip involves multiple stopovers.
Most appropriately, the travelers may have needed to purchase an entirely new travel insurance policy for the complete dates of the new trip from the United Kingdom and return, rather than just purchasing a separate policy to cover the uninsured portion. Alternately, the travelers could have approached a travel insurer that would have been able to insure a journey originating in Kenya, as indicated by the travel dates on the traveler’s application for insurance.
It’s a good warning for travelers who may think of travel insurance purchases as more straightforward than they are. At minimum, travel dates, destinations, and passenger ages and dates of birth must be correct for a policy to be valid. Trip costs must also be accurate, because that helps determine the amount of coverage is available to the travel should they encounter a travel delay, trip interruption, or cancellation. For example, underestimating the cost or length of a trip could result in the purchaser paying insufficient premium for the coverage they need, so travelers should ensure to include only accurate information on their application.
Insurers set premium pricing based on the amount of risk associated with the traveler’s trip attributes. Generally speaking, longer international trips with more intermediate stops carry higher risks than shorter trips with fewer stops, so it’s really necessary that the insurer have accurate information.
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Travel insurers have well-trained employees who can review the provisions in each policy they sell, and answer questions about eligibility and exclusions. In the case of this particular family, they argued that the traveler’s journey did begin in the United Kingdom—but the travel insurer argues that the trip from the United Kingdom did not actually begin on the date the traveler left the United Kingdom—the traveler provided the date they departed from Kenya. There are actually legal distinctions based on where a traveler begins and ends their trip, and where they consider residency.
In the United States, travel insurers are regulated at the state level, so providing accurate detail about the traveler’s state of residence is essential, since some states have different coverage limits, or different requirements for notifications on insurance sold in that state. U.S. travelers who inaccurately claim residency in another state could similar be subject to having their policies cancelled—similarly to if they provided trip dates or destinations that are also not accurate.
When in doubt, travel insurers can always answer questions—either before or after a travel insurance policy is purchased. Most U.S. insurers allow travelers to cancel their policies for a full refund after a pre-specified grace period, provided the trip is far enough in advance, and no claims have been filed against the policy. If anything is unclear or seems like a special situation, it’s worth contacting the insurer for verification—just a few minutes can ultimately save travelers the heartache of taking home a hefty hospital bill as an unexpected souvenir of their journey.
Both the original BBC article and Fodor's coverage bury the lead, which should be: don't make assumptions about how to amend your travel insurance that contradict the terms of the policy. The original BBC story states that the travel insurance must be purchased before the start of the trip, not mid-trip -- so the family's self-designed "extension" was void, plain and simple: either the family erred in claiming that the UK was the point of departure for the trip, or they sought to purchase insurance for a trip already in progress. Either way, the insurer was within their rights to void the policy. These articles are poor journalism. While it's certainly unfortunate that the daughter fell onto such terrible circumstances in South Africa, the anti-travel insurer slant to both headlines is deceptive. Both articles arrive at the nuances that prove that the insurer is within their rights to void the policy, but not before they've muddied the waters with storytelling that makes the insurer out to be the bad guy through use of murky language.tl;dr: "A UK family found out the hard way that trying to self-engineer a seemingly intuitive amendment to their travel insurance policy can come at a heavy cost. Because their daughter's trip from the UK to Africa had already started when they added a stop in South Africa, they were forced to bear the cost of a $125k hospitalization."