As per the IRDAI’s Annual Report, FY 2014-2015, the incurred claim ratio or the claim ratio average for the general insurance sector was 79.69% for private insurers and 82.09% for the public insurance companies. The low ratios point towards a trend of increasing claim rejections, which you, as a policyholder, should be aware of.
If you are planning to travel abroad with a travel insurance plan, you can be rest assured to have a safe trip with coverage against unexpected contingencies. However, a memorable trip can soon take an unpleasant turn in case your claim is rejected in your time of need. Thus, it would be wise to steer clear of the following malpractices while travelling abroad:
- Selecting the wrong coverage in your travel insurance
Travel insurance is often available in a combination of coverages and add-ons. If you have purchased a cover only for baggage, then you cannot claim for financial loss due to flight delay and vice-versa. Therefore, it is important to read the contingencies stated in the policies, or alternatively purchase a comprehensive travel insurance policy to stay worry-free.
- Being Careless about your valuables
When you are staying at a hotel, always ask for a safe to keep your belongings secure. For example, if your camera or laptop is stolen that was kept in plain sight even within a locked room, still your insurance claim can be rejected. In the case of documents, it is always advisable to carry a photocopy of critical documents with you. Make sure you remember to take your belongings when leaving restaurants, which are surprisingly one of the most common places where stuff is generally left behind.
- Ignoring travel advice of authorities
Before you start planning, make sure the travel destination is not listed as a high-risk location by Foreign and Commonwealth Offices (FCO) and the World Health Organization (WHO). If you end up with losses and damages in any of such designated travel destinations, then your insurer will not accept your claims, even if you’ve abided by other criteria.
- Fibbing about the details
When you make a claim, the insurer will require a detailed statement of the losses or damage incurred. Never fib about the amount or disclose fictitious losses. Insurance companies employ experienced underwriters who can detect false claims and it can even land you in a ton of legal troubles.
- Not Declaring Medical Conditions
Disclosing correct medical history of special conditions prior to applying for international travel insurance is critical. In case you meet with an accident or fall ill abroad due to a pre-existing condition and fail to declare it, your reimbursement claim will be rejected. However, at the time of purchase of travel insurance online, make sure your insurer is offering cover for pre-existing medical conditions. The absence of the same can lead to the incurring of huge expenses in case you’re hospitalized due to such health conditions.
- Indulging in activities not covered
Travel insurance policies often exclude damage and losses resulting from participation in adventure sports. Thus, before you consider bungee jumping or skydiving on your next trip, make sure you can bear the risk of any unfortunate event.
- Radioactive Contamination
Damages incurred due to radioactive fallout or contaminations are not covered under travel insurance policies. The exclusions include all damages by nuclear wastes, fuels, and explosions.
- Civil Wars/Terrorism
When planning your international travel, especially to a country with a volatile political situation, it’s best to examine conditions and what threats might arise before visiting. Just about every travel insurance company excludes damages incurred due to wars and civil unrest. In the case of terrorism, you should do your research and find out the insurers covering damages caused due to terrorist attacks. Not all insurance companies offer this coverage, however, many leading insurers have now understood the necessity of the same and are offering customers with terror damages.
- Alcohol/Drug Abuse
Any kind of impairment or accident arising due to indulgence in drugs/alcohol is not covered in travel insurance policies.
- Suicide Attempts
Any attempts of suicide or wilfully inflicting harm to oneself are not covered in any travel insurance plans
The list of exclusions in an international travel insurance policy can be studied further by referring to the policy wordings. As an added measure, you must choose an insurance company with a track record of high claim settlement ratio .
However, in case your genuine claim is rejected, you can contact the insurance company to understand the grounds on which your claim was rejected and apply for an appeal. Next, you may check the grievance and claim settlement section of your policy to assess the ways to proceed further.