What is the point of travel insurance if it won’t cover COVID-19?

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John has been burnt by his COVID-19 travel insurance experience and wants to know whether he should even bother with it in future.


Q. John
I think travel insurance is a scam! On 20 January I booked a round-the-world business class ticket for my wife and I to depart in mid-May. Cost me just over $13k. I took out travel insurance with the RAC travel insurance for a two-year travel package as we were going to be travelling for over five weeks. I tried to claim for a refund when the pandemic hit. They told me that I wasn’t covered. I then claimed with my credit card travel insurance and had the same result. What is the point of taking out travel insurance?

A. As someone who has had a very similar travel experience this year and also has never had to make a claim on my travel insurance, I definitely understand your sentiment.

While you were not able to claim your cancelled trip on your travel insurance, you should have been able to have the trip refunded by the airline, which does sort of make the travel insurance a moot point, however.

In my situation this year, however, my travel insurer didn’t offer me a refund for my premium of the trip I was no longer able to take, so you are still out of pocket for the insurance money, which is frustrating.

While I was unable to secure a refund, my travel insurer has allowed me to reuse the insurance cover I purchased when we do eventually take our trip, whenever that may be. Hopefully your insurer has offered the same.

Getting back to the point of travel insurance, like most other insurance, it is more of a necessary evil.

Sure, you can take the risk and travel without it, in the same way you can take the risk and forgo home insurance. But if your house burns down you had better be able to afford to build a new one entirely from your own funds.

Similarly, if you are overseas in a foreign country and require a medical evacuation to get home, you are up for expenses possibly in excess of $100,000.

Do many houses burn down? No. Do many travellers require a medical evacuation from their holiday? No. Do you want to be stuck with the expense if it does happen to you? That is a question you will have to answer yourself.

While medical evacuations are usually the worst scenarios for holiday horror stories, your travel insurance can also save you a lot of money for any medical emergency that may happen on your travels, as well as covering you for more common experiences such as losing your personal belongings or having them stolen.

You can also be covered for non-pandemic-related cancellations, including reasons such as illness, or injury or death of a close relative.

No-one likes paying for their travel insurance, but we can’t recommend going anywhere without it.

Have you ever travelled without travel insurance? Do you think it is a scam?

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Written by Ben


Total Comments: 15
  1. 0

    Travel Insurers change the rules to suit them so they don’t have to do the big payouts. Any big catastprophe is not included now.

  2. 0

    Not all travel insurance is a scam BUT it sure can be ! I took out travel insurance in 2017 with NRMA travel. I am an asthmatic and told them such, went through the motions of choosing a policy and that was that. I then left a few days later for Asia.

    After arriving in Asia, a short time later I presented to hospital with a wheeze and feeling very tight in the chest like asthma. They did a lung X-ray and told me I have Pneumonia. The report said I presented with asthma but on X-ray have Pneumonia so the insurer refused to cover my hospital stay given the reason I presented was for asthma not Pneumonia. Go figure that scam !!! The insurer argued I never elected to take out the higher policy which covered me for asthma.

    I argued and believed I had in fact the top cover exactly for asthma, what asthmatic wouldn’t want that cover when traveling! So $15,000 hospital bill later and 3 months of care I returned to Australia broke… 15K !! was my cost to be hospitalized.

    Travel insurance is very tricky, and the insurer’s will scam their way out of it IF they feel they can argue with the slightest of miscommunication or misunderstanding, or if they can find any loophole! Be VERY careful and check who is the most honest insurer , read reviews like this one from many sources and do some homework.

    Be VERY clear what you want and DOUBLE check when you take a policy you are being covered for what you think you are buying. Ask them to email what you are NOT covered for and are covered for. And hopefully things will work out.

    • 0

      I too am asthmatic and I take a policy through Medibank. It lists the pre-existing conditions which are not covered and asthma is not one of them. Never had to make a claim for asthma so I have not tested it. I did have an accident in The Netherlands once and broke a toe, my travel insurance covered it all, less the excess. Similarly cruise ship Doctor visits, for flu-like symptoms, all covered.
      Also most travel policies specifically exclude events like a pandemic, along with terrorism, war and war-like events. Nevertheless I would not travel internationally without it. NZ maybe but nowhere else.

    • 0

      Hi Eddy,

      I guess if I had a slight injury they would have covered me, but when they realized it was going to be a long hospitalization they decided no way in hell. NRMA travel left me without a care or thought in the world but only too happy to take my cash for a worthless policy ! The doctor later told NRMA travel that although I did present with asthma like symptoms , my condition is the result of Pneumonia. NRMA travel said im not covered for asthma and that’s why I presented to hospital and i was not covered for Asthma so anything else is irrelevant. They even went as far as to say I must have paid the Doctor to outline my condition was Pneumonia related and not asthma. absolutely disgusting what an insurer will do to get out of a contract and of course they know full well if u don’t like it, good luck finding the money to fight it in court. 9 times out of 10 they will get away with awful corrupt behavior and they know it.

  3. 0

    I was due to travel overseas in March 2020. I had travel insurance (no excess with this one, great!) and of course when taking it out looked through all the activities that I did not need insurance for. COVID-19 happened and I looked to my insurer to claim and was advised it didn’t cover pandemics/epidemics. I checked my policy and sure enough pandemics/epidemics were part of Exclusions. But, even at the time of acquiring travel insurance would anyone have thought “it doesn’t cover pandemics/epidemics, so forgo that policy”? I would have still gone with the same insurance company. Even though I had taken out the insurance some 3 months prior to my trip, the company reimbursed my premium in full. I will go with them again. The end result after making claims with airfares and accommodation, I am approx $1200 out of pocket from having paid $4020.

  4. 0

    It’s definitely not a scam.
    The policies state they don’t cover pandemics (along with some other things). You can imagine that just about every travel company would have gone broke if they had to pay out on everyone’s claims due to COVID-19.
    As the article says, in these circumstances it’s up to the providers to provide a remedy – refund, vouchers etc.

  5. 0

    Glad to name the travel insurance company – TravelCard Real-Time Travel Insurance. They issue you with a card and if you get into difficulties and need money they upload money on to the card for you to use, no matter where you are. You’re not having to wait until you return home and lodge travel claims.

  6. 0

    One of the biggest problems with travel insurance is that people do not read the fine print of what they are covered for and what is not covered. I live in Thailand and the biggest problem is that people come here for a holiday and they will hire motor scooters to use or a jetski and they are not covered by their travel insurance because the people themselves do not read the small print and take out the cover they need for the activities they plan to do but instead go cheap charlie and take out the basic insurance and hope that nothing happens to them.

  7. 0

    Travel insurance is most definitely a scam. Most of them won’t cover what they call “medical conditions” As far as I am concerned, if one has had some angina and it is fixed with a coronary stent – you no longer have a medical condition!
    As a result, I can no longer travel to the USA or Canada where Travel Insurance really only covers stolen baggage. My advice; only travel to countries where there are reciprocal arrangements, ie New Zealand and the UK.

  8. 0

    I once travelled to New Zealand without it and my rental car was broken into and a number of things stolen. The only thing the police recovered was the first aid kit. Two days later I returned to Australia and won some duty free competition and received money to about the same value as the items that were stolen.

    Since then most of my travel has been to Asia and Europe. I have always had insurance, although for the last few years I have relied on the insurance provided by my credit card. In the last 10 years I have been medivacced from St Petersburg Russia and had my appendix out in Omsk (in Omsk I was fortunate that I did not have to lodge a claim because the hospital did not charge me because I was a guest of a citizen). There have been a few other areas where I could have made a claim but the excess meant it was not worth doing so.

    So now I always have insurance and wouldn’t travel without it.

  9. 0

    At the end of the day they are an insurance company and like all insurance companies whether it be travel, motor vehicle, home, workers compensation they are only interested in getting the most money in with premiums and payout the least amount out with the claims

  10. 0

    Here’s a list of pre existing conditions that are commonly acceptable.

    This list is from the Australia Post international comprehensive travel policy at $729 basic premium.
    ‘We automatically include the Existing Medical Conditions listed in the table following provided:

    You have not been hospitalised or required treatment by a medical practitioner in the last 12 months for any of the listed conditions;
    You are not under investigation for any of the listed conditions;
    You are not awaiting investigation, surgery, treatment or procedures for any of the listed conditions;
    Your condition satisfies the criteria in the table following; and
    all Your Existing Medical Conditions are on this list.

    All time frames are measured in relation to the relevant time, unless specified otherwise.

    Condition – Criteria

    Acne – No additional criteria.
    Allergy – In the last 6 months, You haven’t required treatment by a medical practitioner for this condition. You have no known respiratory conditions (e.g. Asthma).
    Asthma – You are less than 60 years of age when you purchase the policy. In the last 12 months, You haven’t had an Asthma exacerbation requiring treatment by a medical practitioner. You have been a non-smoker for at least the last 18 months. You don’t need oxygen outside of a hospital. You don’t have a chronic lung condition or disease (whether chronic or otherwise) including Chronic Asthma, Chronic Bronchitis, Chronic Obstructive Pulmonary Disease (COPD), Emphysema or Pulmonary Fibrosis.
    Bell’s Palsy – No additional criteria.
    Bunions – No additional criteria.
    Carpal Tunnel Syndrome – No additional criteria.
    Cataracts; Glaucoma – In the last 90 days, You haven’t had an operation for this condition. You have no ongoing complications of this condition.
    Coeliac Disease – In the last 6 months, You haven’t been treated by a medical practitioner for this condition.
    Congenital Blindness – No additional criteria.
    Congenital Deafness – No additional criteria.
    Ear Grommets – You don’t have an ear infection.
    Epilepsy – In the last 2 years, You haven’t required medical treatment for this condition. You don’t have an underlying medical condition (e.g. previous head trauma, Brain Tumour or Stroke).
    Gastric Reflux – Your Gastric Reflux doesn’t relate to an underlying diagnosis (e.g. Hernia/Gastric Ulcer).
    Goitre No additional criteria.
    Graves’ Disease – No additional criteria.
    Gout – No additional criteria.
    Hiatus Hernia – No additional criteria.
    Hip Replacement; Knee Replacement; Shoulder Replacement; Hip Resurfacing – The procedure was performed more than 6 months ago and less than 10 years ago. You haven’t had any post-operative complications related to that surgery. Post-operative complications include joint dislocation and infection.
    Hypercholesterolaemia (High Cholesterol) – You don’t have a known heart or cardiovascular condition.
    Hypertension (High Blood Pressure) – You don’t have a known heart or cardiovascular condition. You don’t have Diabetes (Type I or Type II). Your Hypertension is stable and managed by Your medical practitioner. In the last 12 months, Your prescribed blood pressure medication hasn’t changed. You aren’t suffering symptoms of Hypertension. You aren’t having investigations related to blood pressure.
    Menopause – You don’t have Osteoporosis.
    Migraine – No additional criteria.
    Gastric Ulcer; Peptic Ulcer In the last 12 months, the Peptic/Gastric Ulcer has been stable.
    Plantar Fasciitis – No additional criteria.
    Raynaud’s Disease – No additional criteria.
    Skin Cancer – Your Skin Cancer isn’t a Melanoma. You haven’t had chemotherapy or radiotherapy for this condition. Your Skin Cancer does not require any follow up treatment e.g. chemotherapy, radiotherapy or further excision.
    Stenosing Tenosynovitis (Trigger Finger) – No additional criteria.
    Urinary Incontinence – No additional criteria.
    Underactive Thyroid; Overactive Thyroid – The cause of Your Underactive/Overactive Thyroid wasn’t a tumour.’



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