If applying for travel insurance sometimes leaves you confused and has you reaching for a medical dictionary, you’re not alone. Providers of insurance policies, at the urging of provincial and federal regulators, are working to make their products more user-friendly.
Just last week, the Canadian Council of Insurance regulators released its latest in a series of study papers outlining what needs to be done to ensure fair treatment of travel insurance consumers when purchasing protection for out-of-country and interprovincial travel.
The release noted that travel insurers have been cooperating with the council to educate consumers about the limitations and exclusions, as well as the benefits, of their products. But it noted that they would be monitoring their progress in making the purchase of travel insurance fairer and more transparent for the customer.
That’s a positive move because travel insurance is an important purchase, and it should not be handled casually or left to the last minute when there is little time to examine policy documents or to ask questions of a professional who specializes in sales of travel insurance. This is especially important now that so many sales are facilitated via social media or over the internet.
What have the regulators identified as key issues for travel insurers to improve on?
- Describe policy features more clearly in plain language; limit the number of plan options; target plans to the needs of specific consumers.
- Standardize and clearly define key terms and expressions (such as “pre-existing condition”, “emergency,” and “treatment”); allow consumers to better understand the extent of coverage offered, and the exclusions, restrictions and limitations of medical questionnaires and disclosure documents.
- Assist consumers who have questions about products for which they are applying, perhaps by setting up call centres or help lines. Help them better understand and deal with policy eligibility requirements when applying.
- Simplify and shorten disclosure documents, and medical questionnaires so customers better understand the limitations of products they are considering and can more effectively compare products in respect to their individual needs. Perhaps also provide a one-page summary of important information.
- Allow purchasers to examine disclosure documents, policies, questionnaires etc. prior to purchase and without an obligation to close a transaction.
- Require insurers to be ultimately responsible for ensuring that anyone selling their products has sufficient knowledge and expertise about the policies’ benefits, exclusions, restrictions and limitations.
- Make sure that insurers have systems in place to assist customers not only through the purchase of their products but throughout the product life-cycle—servicing the policy, dealing with assistance need in case of emergency, assistance with claims handling and resolving disputes in case of claim denials. Ensure that persons with rejected claims are treated fairly.
- Clearly disclose the importance of the application process, and the potential consequences of the consumer providing inaccurate information in good faith or not.
We may also emphasize that not all of the responsibility for making a sound purchase of travel coverage lies with the insurer. This is an important purchase. It involves not only the premium to be paid, but the financial consequences of making a bad purchase and encountering a justifiably-denied claim. As much as travel insurers may simplify, clarify and provide good options for safe travel, it’s still the purchaser who makes the final decision to buy and has the final responsibility to understand what he or she is buying.
Ingle International takes great pride in making travel insurance information and plans accessible to consumers since 1946. We are thrilled that regulators are catching up on the need for transparency in the industry.
Are you prepared to make a sound insurance purchase? Contact one of our representatives now.