Which? magazine has been checking the travel insurance market and still thinks there is some bias against travellers with medical conditions. Here’s the word;
Holidaymakers continue to pay over the odds or face being priced out of travelling altogether because the travel insurance market is not working for people with medical conditions and older travellers, Which? has found. A Which? survey of just over 4,000 people who took out an annual travel insurance policy in the past two years found the median price paid for those declaring medical conditions was £150 – 56 per cent (£54) more than those without conditions (£96).
One respondent, who told Which? they have well-controlled diabetes, said they had found they were paying roughly four times what they would be charged if they did not declare their condition, which they described as ‘so unfair’. Age is also a factor when it comes to paying higher premiums, with the biggest hikes seen for travellers 75 or older, even if they are in good health. The median price paid for annual cover by those aged 75 or older was £300 – 65 per cent (or £118) higher compared with customers aged 65-74 (£182), and more than double the amount paid by those aged 55-64 (£142).
FCA RULES NOT WORKING
Older travellers are also more likely to have medical conditions, which means their premiums will be bumped higher still. Worryingly, the consumer champion’s survey suggests rules introduced by the Financial Conduct Authority (FCA) in 2021 to help “signpost” specialist travel insurers are only having a limited impact.
Six in 10 (61%) respondents to the Which? survey either had a pre-existing medical condition or a history of one – and of these people, more than a third (36%) said that in the last three years, they had encountered problems buying travel insurance because of their condition(s). This could include expensive premiums, insurers declining to cover their conditions and issues when claiming.
Fewer than half (48%) of respondents who had difficulty buying insurance because of their medical condition in the last three years had tried a specialist directory. Customers who had used a directory were more likely to say they had discovered it by chance, or from someone they know, than on the recommendation of an insurer.
Of those with medical conditions, one fifth (21%) said their medical conditions meant premiums were affordable but ‘very expensive’ – while just under one in 10 (8%) said if they disclosed their medical condition(s), they were offered insurance – but not at prices they could afford.
CALLING FOR ACTION
The FCA is currently reviewing the effectiveness of travel insurance signposting rules, and Which? believes the regulator should be ready to take significant action should it find that firms are not following the rules.
Jenny Ross, Editor of Which? Money, said:
“It’s really concerning that travellers with medical conditions still routinely face barriers to finding the right cover for their holidays.
“Our research has found that awareness of the specialist directories is too low among those who could benefit from them, meaning some travellers could either assume they can’t get cover, decide not to disclose their condition due to price concerns or disclose them and end up paying more than they should.
“The FCA’s new Consumer Duty must mean that insurance firms improve the visibility of their signposting, and be clearer with customers about how their cover could be limited as a result of their pre-existing conditions.The regulator must be ready to take action against firms not following the rules.”
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