Medical expenses claims on travel insurance policies have nearly quadrupled in recent years because larger numbers of older people are enjoying exotic holidays or ‘a gap year for grown-ups’.
According to the Association of British Insurers (ABI) the cost of illness overseas soared from £74m in 2004 to £275m last year, with the number of claims rising from 120,000 to 337,000 over the same period.
While medical costs have risen faster than most forms of inflation, the ABI says the age of holidaymakers also played a major part in raising claims. Spokesman Malcolm Tarling explained: “People are living longer and travelling further afield but the sad fact is that the older you are, the more likely you are to fall ill.
“Travellers aged over 65 are three times more likely to make a travel insurance claim than those aged 35, and people over 85 are eight times more likely. The average claim made by a person over 65 is nearly three and a half times more expensive than one made by a person under 50
“This combination of increased cost and frequency of claims means that customers in their 80s are around eight to 12 times more risky than customers under 65.”
Graeme Trudgill of the British Insurance Brokers’ Assocation (BIBA) agreed: “Increased travel by older people to destinations outside the European Union means claim costs are much higher as there is no access to free medical care through the European Health Insurance Card.”
America is the most expensive country in which to fall ill – with medical bills averaging more than £4,700 – and Greece the least, with bills nearer £400. The global average for medical claims on travel cover is £1,300.
Rising claims and costs also led to increased complaints. Martyn James of the Financial Ombudsman Service (FOS) said: “The Ombudsman service received 2,536 complaints about travel insurance last year – a 27pc increase on the previous year. We upheld 42pc of travel insurance cases in favour of consumers.”
Fewer disputes would arise about travel insurance if more care was taken to choose the right policy. Despite what the comparison websites might suggest, the cheapest is not necessarily best.
For example, Mr James said: “Check the financial limits that apply in different circumstances, and the level of excesses.
“We have seen a number of cases recently relating to ‘multiple excesses’. An example would be where famlies lost baggage and then had an excess applied to each family member including the children travelling.”
While that sort of legalistic nit-picking to cut a claim is infuriating, the ABI says members paid a record £275m during 2010 – or £5.3m every week – to holidaymakers and others who fell ill overseas.
If you complained to your insurer and remain unhappy with the way they dealt with your claim, then you can contact the Ombudsman on 0300 1239 123 or use the link above.