New data shows millions of vacationers being priced out of travel insurance owing to medical issues or age.
Despite the Financial Conduct Authority introducing rules in 2021 to assist those who fall into these categories, Which? reports that these groups are not being properly directed to specialist insurance brokers.
Today, insurance executives are scheduled to testify before the Treasury Select Committee.
Travel insurance providers must refer pre-existing medical condition customers to a database of specialty insurers under FCA requirements.
The median price paid for annual travel insurance by those declaring medical conditions was £150, or 56% more than the price paid by those without conditions, according to a study conducted by Which?
Graeme Trudgill, executive director of the British Insurance Brokers Association, stated, ‘Since the pandemic, the travel insurance market has significantly reduced insurance capacity.
It is also true that more people were unable to receive routine medical examinations due to the effects of Covid, which contributed to the frequency and magnitude of claims after travel was fully reopened.
One person with well-controlled diabetes reported paying approximately four times as much as they would if they had not disclosed their condition, which they deemed ‘unfair’.
Over a third of pre-existing medical condition patients have trouble getting travel insurance in the past three years.
This includes costly premiums, insurers refusing to cover their conditions, and difficulties when filing a claim.
Tom Marsland, policy manager at the Charity for disability equality Scope, stated, ‘Life costs more when you’re disabled, and this includes necessities such as travel insurance. With inflation on the rise, these costs have only increased.
‘It can be extremely difficult for the disabled to obtain affordable insurance due to Sky’s high premiums. Occasionally, disabled individuals are denied coverage entirely.
‘Disabled individuals must be able to get affordable insurance like anyone else. There must be a great deal more openness regarding pricing and risk assessment.
We want insurers, regulators, and the government to collaborate to ensure that disabled individuals are no longer unjustly penalized.
Even in good health, people 75 and older pay the highest costs.
Those aged 75 or older paid a median annual premium of £300, which was 65 percent (or £118) higher than consumers aged 65-74 (£182) and more than double the amount paid by those aged 55-64 (£142).
Additionally, older travelers are more likely to have medical conditions, resulting in often-increased premiums.
This, along with rising medical claims costs, inflation, exchange rate challenges, and vacation costs, has impacted premiums, according to Trudill.
This suggests that the Financial Conduct Authority’s 2021 rules to assist “signpost” specialized travel insurers are having little effect.
7% of travellers go without insurance due to its exorbitant cost.
Trudgill stated, “Insurers must evaluate the likelihood of an insured person becoming ill before travel, resulting in a cancellation, or while abroad and requiring treatment abroad.”
Who is at fault?
Which? spokesman: ‘We’re concerned that price comparison sites do not direct travelers with medical conditions to specialist directories.
However, there is a broader issue with insurers offering coverage for senior travelers or those with medical conditions.
Compare the Market’s spokesman stated, ‘Our process is compliant with the FCA’s signposting regulations. And we make it abundantly clear throughout that accurate responses are required.
We advise clients to be completely honest when filing claims to maximise their chances of success.
A spokesman for the Association of British Insurers, a trade association for UK insurance companies, stated, ‘Our members work diligently to make competitively priced products accessible to as many people as feasible.
If an insurance cannot provide coverage, they will automatically send you to another provider.
We’re working with the FCA to evaluate this procedure’s efficacy and potential improvements.
