Sunday, October 11, 2009

Pack your flip-flops and travel insurance

travel insurance

Just about the time the second wave of the H1N1 virus hits, many of us will be thinking about giving the north the frigid finger and booking a holiday in a hot place. That'll happen after several mornings of scraping icy windshields or trying to find that missing glove or scarf from last year.

Escaping the frosty temperatures doesn't mean you can dodge the illness. You can expect the virus to be lurking in crowded airports, on planes and in hotels. Sure, you can take the usual precautions, sneezing and coughing into the crook of your elbow, carefully washing hands and practising the knuckle bump instead of a handshake or hug. And getting the vaccine when it becomes available.

But there's one thing many of us often overlook in our haste to beat it to beaches and deserts: travel health insurance. We might be vigilant about arranging pet sitters and finding the most flattering bathing suit, but not so much at protecting the hard-earned investment in a precious holiday.

A 2008 Ipsos Reid poll conducted for RBC Insurance suggests the topic is not considered as sexy as the bikini you might buy for the trip. Here are a few highlights:

-Nearly 40 per cent of Canadians never purchase health insurance when travelling on holidays to the United States, where medical costs are some of the highest in the world. (If you've ever seen Michael Moore's documentary Sicko, you might change your mind.) According to the study, a four-day stay in a U.S. hospital for an appendectomy could cost $39,400 US, with only $1,600 Cdn covered by a government health insurance plan (GHIP). A one-day stay in a U.S. hospital for a broken arm and wrist could cost $32,600, with only $400 covered by a GHIP.

-In a similar study done the year before, it was found that 64 per cent have never purchased travel health insurance when travelling in Canada because a majority-- around 75 per cent --believe their provincial health insurance plans would cover everything. (Provincial plans often exclude X-rays, dental work, ambulance transportation and prescription drugs.) One example cited the cost of an air ambulance with a full medical team travelling from Calgary to Toronto; the $28,000 cost would not be covered by a government health insurance plan.

-Nearly 30 per cent have never purchased travel insurance when travelling outside of Canada or the United States, skewing toward 18-to 34-year-olds. Another common misconception is that certain credit cards that have travel health insurance cover all costs incurred for illness or injury while travelling. It's wise to read the fine print because this is often not the case.

Martha Turnbull, president of the Travel Health Insurance Association of Canada, is a nurse and works as a claims assistant in the travel division of RBC Insurance. I asked her some travel insurance questions relating to H1N1, but the answers would apply to most infectious illnesses.

Q. With all the news about the second round of H1N1, would a traveller who has already booked a trip and bought travel medical insurance be reimbursed if they want to cancel because they are worried about contracting the illness?

A. Typically, no. People can't cancel because they are worried. It has to be a defined situation. In this case, it would be best to ask your travel agent. Most insurance policies would change the dates of travel. Or, if the policy had a "cancel for any reason" clause, the person might be entitled to some money back, but not all of it. It depends on the insurer.

Q. In June, the World Health Organization deemed H1N1 a pandemic. Will travel health policies still cover the illness?

A. I haven't heard of any instances (where it won't). I can only speak for RBC. (The pandemic classification) does not void any part of the policy.

Q. If I'm advised not to travel and stay in bed when I become ill at a destination, will I be reimbursed for the cost of my extended days in a hotel, plus other expenses incurred?

A. Each company would look at it differently. If someone was ill and was unable to travel home, they would be covered for hotel and food. This is an important point.

Trip cancellation or interference and health coverage will cover the cost to change travel arrangements.

INSURANCE FAST FACTS - Cost of insurance is usually based on no pre-existing health issues, length of trip and age. here's a couple of cost scenarios for travel health insurance, from rBC.

A deluxe package includes: cancellation and interruption coverage; emergency medical coverage; emergency medical transportation; baggage and personal effects coverage; flight accident and travel accident coverage. - Family of four, both parents under 60:

Trip: Seven days in Hawaii Value of trip: $4,000

Policy premium for deluxe package: $380 - Snowbird couple, both aged 65 trip: 60 days in Jamaica Value of trip: $6,000

Policy premium for deluxe package : $1,442