As the Omicron wave subsides, travel insurance claims crawl

Before the pandemic, Lauren Mack, 44, a New York-based writer, “didn’t routinely purchase travel insurance,” she wrote in an email. Covid-19 convinced her otherwise, and out of six trips taken since the start of the pandemic, she’s had to file claims for three – twice for weather delays and once because her fellow traveler tested positive. for the virus. Two are still under review, and the first took nearly two months from application to reimbursement.

Although understanding what is covered by travel insurance and what is not continues to trip up consumers, comprehensive and “cancellation for any reason” policies have emerged as a way to cover bookings not reimbursements and to seek compensation for travel disruptions as travel continues to be impacted by waves of coronavirus and war-related uncertainty in Ukraine. (Most travel insurance policies exclude war and civil unrest and won’t protect your investment if the conflict in Ukraine spills over into neighboring countries.)

Now, getting a decision – or even an update – on a claim has become the latest issue for consumers when it comes to travel insurance, whether it has something to do with Covid or not.

“The claims review and approval process has slowed down due to the pandemic,” said Kendra Thornton, owner of Royal Travel & Tours, a Winnetka, Illinois-based travel agency, who attributes the slowdown to the volume of claims. . “Approved claims that used to be paid in less than two months are now taking up to five months or more.”

As Americans once again prepare to travel in large numbers – Destination Analysts, a market research firm, recently found that more than 93% of Americans are planning a vacation in the next 12 months – many are considering travel insurance . Depending on the destination, you may need to purchase it; Belize, Fiji and Singapore are among the countries that require travel medical insurance to cover expenses if you contract the virus while visiting.

Cover Genius, an insurance technology company that integrates insurance sales during travel booking on sites like Booking.com and Icelandair.com, saw sales increase sixfold in 2021 from figures pre-pandemic. At WorldTrips, travel medical insurance sales are up 67% for trips in 2022 compared to 2019. Travel insurance company Seven Corners said sales have already increased 200% in 2022 compared to the same period in 2021.

“Certainly with Omicron, we’ve been busy getting questions and calls from customers asking what might be covered, and we’ve seen sales pick up over the past few months,” said Meghan Walch, Product Manager for InsureMyTrip.com. , an online marketplace for travel insurance that allows buyers to filter policies that cover Covid-19. “People are looking to get out and learn to travel now.”

Traditional insurers are not the only ones looking for new buyers. In January, Marriott Hotels partnered with insurer Allianz to offer travel insurance. When booking a hotel online, travelers will be offered an insurance option at checkout. Beyond the cost of the room itself, insurance can cover the full cost of the trip, which can include non-refundable prepaid lift tickets and tours. The cost of insurance is charged immediately, although the hotel rate is normally only due on the date of travel.

This spring, Airbnb plans to offer travel insurance that will cover non-refundable portions of a stay booked through the platform. It also recently launched a protection plan for travelers who cannot travel due to Covid-related travel disruptions, such as border closures or quarantine requirements, which were not in place at the time of the reservation ; in these cases, if an Airbnb reservation is non-refundable, the company will offer a coupon for 50% of the cost of the non-refundable portion of the reservation for future use. Apparently designed to cover Omicron’s surge, the program runs until April 30 or until its $20 million fund runs out.

“People now know more about travel insurance providing a safety net if they want to travel,” said Rajeev Shrivastava, chief executive of VistorsCoverage.com, an online marketplace for travel insurance. “There has been a huge jump in sales, but also in inquiries.”

As travel insurance becomes more ubiquitous, getting a quick response to a claim remains a challenge.

From when a traveler files a claim to when the insurer first responds varies, but typically takes five to 10 days, experts say.

But viral surges, most recently Omicron, have clogged the system. At online travel insurance retailer Squaremouth, around 27% of claims have been related to Covid-19 since the start of the pandemic. Currently, almost 40% are Covid-related.

“As an industry, we have seen an unprecedented increase in the number of Covid-related claims over the last two plus years, which has sometimes resulted in a backlog for many member companies who have worked 24 hours. on 24 to help their customers. according to a statement provided by the US Travel Insurance Association, a nonprofit trade group. “With the surge in claims, companies are increasing their workforce; however, new personnel added must be trained and authorized before they are permitted to adjudicate claims.

Seven Corners is one of them and recently hired seven new employees trained in complaints handling, for a total of 24.

“We’re trying to get ahead of any push ahead,” said Jeremy Murchland, president of Seven Corners.

Marc Devens, a software product manager living in Jersey City, NJ, remains loyal to Seven Corners based on a significant medical claim he and his wife made while living in China several years ago, which was handled effectively. But last fall he struggled to reach someone at the company to update a policy for a December scuba diving trip to the Caribbean, though it was eventually ironed out and the trip went smoothly.

“The travel insurance industry is probably booming, but they certainly didn’t seem to be anticipating it with more staff,” he said.

According to insurers, the best way to get prompt attention is to be organized and thorough in filing the required documents. Keep all receipts for related expenses, as well as any documentation of airline delays and cancellations.

Like other illnesses, if you contract Covid-19 (and it is covered by your plan), which prevents you from travelling, cuts your trip short or results in quarantine, keep records of treatment or diagnosis from your providers health care. A home Covid test is not sufficient for a medical claim; insurers require the results of a test administered by a medical professional along with a doctor’s advice not to travel.

In the event of lost luggage, it can be difficult to remember everything you have packed. For this reason, Stan Sandberg, co-founder of online marketplace TravelInsurance.com, recommends taking a picture of your packed and opened suitcase.

Although insurance retailers do not handle claims, many say they will step in and help customers get attention. InsureMyTrip.com has a claims assistance program run by representatives called “Anytime Advocates” who review your case if you have been denied or requested more information.

“Sometimes when we have clients that we don’t think are getting the attention they deserve, we will escalate that with our partners,” Mr. Sandberg said. “We can apply a little pressure, but we’re not going to be helpful in making a claim decision.”

“While I had to endure a longer than usual processing time for my claim to be settled,” said Ms. Mack, the New York writer, “it finally did.” Now, she wrote in an email, “I will always buy insurance – pandemic or not – because you never know what might happen on your travels.”

Elaine Glusac writes the Frugal Traveler column. Follow her on Instagram at @eglusac.