Early Birds Lock In Savings. But Watch Out For Changes

It’s “Early Bird Special” time, and if you’re a snowbird planning next winter’s vacation, this is your chance to save money on your travel health insurance. But be careful. There are some pitfalls you need to know about.

Many insurers offer these specials that lock in future coverage at current rates in anticipation that premiums will go up in the fall or winter. Historically, that seems to be the pattern. Rates have normally gone up about five or six per cent a year—sometimes more. Insurers have to protect themselves against future fluctuations in the value of the loonie and the relentless increase in the cost of US health care, which is where the money goes if you have a medical emergency.

Buying a policy in August or September that you won’t use until November or later can save you a substantial amount of money. But it won’t lock in automatic coverage if your health changes in the interim. Let’s say you are perfectly healthy in August but you undergo surgery a few weeks before you are due to leave on vacation, or your medication for an ongoing condition (e.g., high blood pressure) is changed, or your family physician refers you to a specialist for a lung condition that seems to be getting worse. That’s a change in your health status and you’re obligated to report it. If you don’t, and you have a medical emergency while on vacation, and your insurer finds out about the change, your policy could be voided.

So if you buy an Early Bird Special three or four months before you intend to travel, do a brief health inventory before you leave: Has any medication been changed or added? Have you been hospitalized? Have you or your doctor spotted any symptoms requiring monitoring or treatment? Have you been referred to a specialist? And is the information on your application just as valid on the policy’s effective date as when you bought it? If it isn’t, make the change, tell your insurer, and get confirmation that you will still be covered.

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