Insurance is a necessary extra expense designed to safeguard travellers, but in these worrying times how can you be sure your holiday policy will cover all eventualities this half-term. Or should you just stay at home?
In the next few weeks, over 140,000 people will be travelling through the major UK airports every day heading off on pre-booked holidays. Florida and California are amongst the most popular American long-haul holiday destinations. Spain, Malta and the Canary Islands are the favoured European destinations closer to home.
With the Asian continents in lockdown, and the world in a panic. What happens if holidaymakers want to cancel their plans? Will the insurance companies support them if they take the safe option?
Insurance rules for epidemics and pandemics
Unfortunately, it all relies on the stuff we hardly ever read – the small print. Previous outbreaks of world-threatening viruses like SARS, Ebola and Zika, have influenced insurers to be cautious and include only the necessary coverage for such events. And epidemics and pandemics have become excluded from most insurance coverage. Leaving holidaymaker covered for what will happen to them, but not what might happen to them.
The World Health Organization has declared the latest virus outbreak as an international health emergency. However, although the insurance companies agree, they aren’t surprised by the newest virus to reach epidemic proportions, and to them, it is an expected risk they have already factored into their policies
At the moment the world is not on code red yet. There has been no official warning from the FCO not to travel anywhere other than China. And this is the deciding factor for the airlines, travel agents, holiday and insurance companies, which will motivate them to cancel flights or holiday packages and issue refunds.
Zurich Insurance issued a travel alert on 23 January 2020 to say that cover for the outbreak was available if already located in an affected region when the virus started spreading. However, insurance cover was not available to those who had continued to travel to the affected area after the FCO warning.
Should I take my family on holiday?
The general insurance small print on the matter of epidemics or pandemics states that most claims will be assessed based on individual cases. But this doesn’t give much assurance to an average family about to embark on an international flight. And it doesn’t provide enough information for anyone debating whether to put health & safety first and stay at home instead.
At the moment The Foreign and Commonwealth Office (FCO) is currently warning against visiting all or parts of nearly 60 countries. So it is essential to double-check if your destination is on the list, as it will affect your travel insurance.
Some governments are asking travellers to reconsider their need to travel rather than giving a direct warning. Unfortunately, this doesn’t mean much to the insurance companies and asking the public to contemplate whether it is wise to travel will not entitle them to a refund for their holiday.
Deciding to travel without heeding the advice of the FCO may forfeit your right to claim back any of your medical expenses or costs of repatriation. However, if your destination was not on the ‘no go’ list when you travelled but has subsequently been upgraded, you will fall into an insurance grey area, and any settlement will be based on discretion when you make a claim.
In some areas, the risk may be low, but that doesn’t mean that in the worst-case scenario, it won’t escalate or in the best-case, diminish to nothing.
Cancelling a holiday you have promised your kids for months. Or have saved your pennies to make happen, is a tough choice. But there may be other factors to consider when making a final decision. Do you need to go? Is your health good? Is anyone you will be travelling with vulnerable (young, elderly, or has a suppressed immune system? The decision will be a real tug of war between your head and your heart.
Best and worst-case scenarios
If you’ve planned your trip a long way in advance. Hopefully, you booked your insurance before the latest epidemic scare started too. If so, it is likely you will be refunded if the FCO advises against travel to your destination, and your journey is cancelled, rescheduled or shortened by the providers.
Unfortunately, if the FCO haven’t declared your destination a ‘no go’ zone, it is unlikely that you will be able to recoup any of your initial your costs unless you can change or defer your holiday. Hotels are usually more forgiving in these cases. And some airlines are more forgiving when changing flights than others. However, the budget airlines tend to be strict unless you have taken precautions in advance and booked a trip with extra adaptability.
If you decide to take the risk and travel to a destination not banned by the FCO, you should be medically covered if something happens, as long as your insurance policy was booked in advance. However, the level of cover differs between companies and policies. And make sure you take appropriate precautions to reduce the risk of infection. Otherwise, it is unlikely you will receive any compensation at all.