Travel Insurers Finding More Ways To Refuse Claims
The Financial Ombudsman Service have released statistics showing that travel insurance firms are looking for more and more ways to avoid paying out on legitimate insurance claims. The Ombudsman, an independent arbitration service, receives over 2000 complaints every year from disgruntled travelers who feel like they are being ripped off by their insurers. A massive 50 percent of these claims are fought and won in the customer's favour compared to a figure of 33 percent for most other types of insurance complaint.
The conclusion is that these travel insurance policies are geared towards allowing more disputes (down to the policy wording) and the insurers are actively looking for excuses to deny insurance claims. An Ombudsman spokesman said: "The high uphold rate suggests that there is more of a problem with the way travel insurance claims are handled by firms than with other types of insurance products."
Mr and Mrs Gill, a retired couple, are all too familiar with the shady practices of these travel insurance companies. They booked a one-off trip to New Zealand, flying via British Airways. Their current travel insurance policy only covered trips of up to 36 days so they decided to switch to RIAS (an over 50s insurer) which allows for trips up to 45 days.
Unfortunately, Mr Gill's mother passed away just before they were due to fly. Her funeral was set for 11th January (6 days after they were due to fly) so the couple had to abandon their plans. They submitted an insurance claim to RIAS to cover the cost of the flights, which came to over £8000. They were expecting a positive response because of the circumstances but they were shocked to receive a rejection letter from RIAS shortly after.
The insurer said: "Although the official cause of death was old age, we refuse to pay the claim because Mr Gill's mother had been prescribed antibiotics for an infection last April, making it a pre-existing condition." Mr Gill responded to the letter saying: "The cause of death was old age and any prescription of antibiotics is irrelevant. The reason given is so broad that it allows for many legitimate claims to be declined. I am very dissapointed with both the rejection of what I believe is a reasonable claim and the customer service I have experienced. Neither of my letters have been acknowledged and it is impossible to reach RIAS by phone."
RIAS was contacted by the press, forcing them to take another look at Mr Gill's claim. They responded saying that the claim had been 'declined incorrectly' and that the evidence provided had been 'misconstrued'. The RIAS responded with: "We have contacted Mr Gill and advised him that his claim for the cancellation of flights is covered. In light of the delay in reaching this decision we have also paid Mr Gill an additional sum as a gesture of goodwill. We have apologised for any inconvenience caused at a difficult time."
James Savery, 19 May 2015