Older travellers face insurance hurdles

Like so many people, Ron Weatherington looked forward to greater freedom to travel in retirement. But he never considered the obstacle he might face when he finally got there: an inability to find suitable travel health insurance.We never travelled extensively until I retired about five years ago,” says the 67-year-old transplanted American. After coverage from the group plan sponsored by his former employer ran out, he and his wife, Barb, looked to private travel health insurance.

The problem is Barb’s congenital heart condition, which she has lived with for more than 30 years, is deemed a pre-existing condition. This led some insurers to offer insurance with restrictive conditions and others to reject their application outright.

“We had to find something that would cover us that doesn’t exclude my wife’s problem,” says Ron.

Majority buy insurance
Faced with declining levels of public funding for health care, Canadians travelling outside the country paid $281 million for private health insurance in 2001, according to the Conference Board of Canada.

What’s more, a survey by the me organization indicates that peace of mind is especially important to older travellers:

  • 90 per cent of people over the age of 55 said they had some sort of health insurance coverage for their last out-of-country trip.

This compares with 74 per cent for the general population, says David Redekop, a principal research associate with the CBOC in Ottawa.

Pre-existing conditions
The Weatheringtons’ situation certainly makes clear, however, that it’s not always as simple as accepting the shifting burden of costs.

One contributor to a 50Plus Discussion Forum writes of a similar dilemma: “At age 73 and after a misspent youth that lasted into my mid-40s, I now own a variety of ‘pre-existing’ health conditions. This has left me in a pickle! I cannot find travel insurance [to cover] my pre-existing conditions.”

“If you’re healthy and under age 65, you won’t have trouble getting coverage anywhere,” says Michael Brattman, vice-president at The McLennan Group in Waterloo, Ont.

In reality, many older would-be travellers with less-than-perfect health face a significant problem when it comes supplementing their provincial health insurance plans.

Age and health usually go hand in hand to determine whether you’re eligible and how much you’ll pay for travel health insurance.

Next page: Types of plans

Types of plans
In general, the older you are, the higher the premium because the risk of having a claim increases, says Brattman. Typically, there is a significant increase in premium costs around age 55. The costs generally rise with age and the length of your trip.

There are two types of travel health insurance plans:

  • Annual plans: You may travel as many times as you wish in the year, as long as you don’t exceed the number of days in a trip specified as a maximum in your plan.

It’s possible to extend or “top-up” the length of your coverage by calling your provider.

  • Per-trip plan: You purchase coverage each time you travel.

The conditions and definitions on a policy may change – with the result that you may not have the coverage you think you do, says Brattman.

“They’re not set in stone,” he says. For example, an expensive loss could prompt a company to adjust its policies.

“Whether coverage is through a credit card or you’re on a group plan through your employer, it’s important to look at the details of that coverage,” says Brattman.

Read fine print
Even if you think you’re familiar with your plan, there may be conditions you haven’t considered. For example:

  • Credit-card companies may require you to pay for travel with their card in order to be covered
  • A group plan might cover you only for business travel.

In the worst case, “You could be travelling under the false assumption that you’re fully covered, when in fact you’re not” says Brattman.

Health considerations
In assessing your application, insurance companies generally look for stability – that any medical condition is under control and has been for a certain period of time.

Some insurers will not cover pre-existing conditions, that is, conditions that you had before leaving for your trip. Others will provide limited coverage in such cases.

The term “pre-existing” generally refers to a condition for which you’ve seen a doctor or received treatment. But this definition can vary wildly, says Brattman.

“Some companies can be so restrictive that even being admitted to a hospital for a 24-hour period is considered a pre-existing condition.”

Wide ranging criteria
Indeed, a limited survey of insurers, conducted by FiftyPlus magazine, turned up wide-ranging criteria, including these:

  • Number of medications
  • Changes in medications in a specific period
  • Stability of medical condition
  • Requirement that you submit a completed medical questionnaire
  • Requirement that forms be completed by your doctor
  • Coverage only if the pre-existing condition was excluded.

It may be tempting to exclude a pre-existing condition if you’re having trouble obtaining coverage, but it’s generally not a good idea, says Michael Brattman.

“There’s just so much that can go wrong. You may think you’re saving yourself a few dollars here and there but to be in intensive care in Florida, for example, can easily cost you $10,000-plus a day. Is it really worth taking the chance?”

He advises consumers to shop around until they find suitable coverage.

Next page: Covers emergency care

Covers emergency care
Even if you have no trouble getting travel health insurance, bear in mind that this type of insurance is designed to cover emergency care. This means that accidents and unexpected illnesses are generally covered, but treatments or services you could have planned for or postponed until you got home are not.

As well, the cost of medical attention you need because of participation in high-risk activities, such as parasailing, mountain climbing and scuba diving, is generally excluded.

Also, suicide attempts, self-inflicted injuries and injuries from war are not covered.

Look at details
When choosing a policy, it is important to look beyond price to the details of the contract. Some important features include the overall policy limit and any deductible amounts you must pay.

“Some [policies] provide coverage for bringing loved ones to your bedside or returning your car back home,” says Brattman.

As well, the daily limits for hospital costs, air ambulanced and other services are variable.

Wide ranging costs
Costs can vary greatly. For example, recent results from a semi-annual survey published by financial information services company, Fiscal Agents, lists premiums ranging from $800 to $2,000 for a healthy 73-year old traveller taking a six-month trip.

Not surprisingly, there will be significant variations in what’s covered by these plans.

“The rule of thumb is, ‘If it sounds too good to be true, it probably is,’” cautions Brattman.

Attending family events
As for Ron and Barb Weatherington, after a lot of legwork, they found an annual policy that covers the three or so trips they make each year. So far, however, they’ve been unable to find a policy that will cover Barb past age 70, when they’ll have to start the search all over again.

Ron Weatherington is adamant that public health care policies must better serve older travellers.

“It is becoming more difficult to be able to attend family events—funerals, weddings, graduations, etc.—as time goes on.”

He believes that governments must address the fact that older Canadians are restricted because of inadequate health care coverage.

Says Weatherington, it’s “a denial of our human rights.”