Monday, October 22, 2012

Travel Insurance Law


Brought to you by our friends at ASB Law


Although travel insurance was not traditionally considered a legal requirement, many travel companies now state that consumers must have travel insurance before travelling with them.  Despite this, many people do still travel without any insurance or with only limited cover. Whilst the majority of people hope they won’t be forced to rely on travel insurance, it can provide security if you suffer an accident, emergency, loss or theft whilst travelling. However, the law governing travel insurance can be complex and consumers are subject to the many terms and conditions contained within policy documents.

People generally assume travel insurance covers medical bills and expenses if you are unwell or injured abroad, and in the majority of cases it does. However, travel insurance policies vary dramatically and not all medical expenses are covered by all policies. Consumers can face significant costs despite buying an insurance policy that claims to cover medical expenses. For example, FirstAssist Services Ltd estimates the cost of travel via air ambulance from the US to the UK at £35-40,000. If your policy merely covers treatment received whilst abroad, you may be liable for the cost of transportation back to the UK in addition to other potential costs.

As well as offering cover for medical purposes, travel insurance policies offer protection for a range of eventualities from lost luggage to family bereavements and emergencies at home. However, not all policies offer such comprehensive cover so it is advisable for consumers to thoroughly check policy terms and conditions to ensure they have obtained an adequate level of cover.

Issues can arise when consumers incorrectly believe they are covered and find out they are not when they attempt to make a claim. Although a policy may offer cover for lost luggage, for example, there may be certain exclusions or limitations which apply. Many policies state that an item is only covered if you take ‘reasonable care’ of it. With the term ‘reasonable care’ being open to such wide interpretation, it’s easy to see how disputes between insurers and policyholders can arise.

Similarly, many complaints are made regarding the period of cover the policy extends to. Whilst it’s beneficial for the policyholder if the cover starts from the date the holiday is booked, often it starts from the date of departure. Therefore, if you are forced to cancel your holiday before you depart the insurance may not pay out as technically the policy hasn’t started. This would apply even if your reason for cancellation is covered within the policy.

In the event of a disputed travel insurance claim, consumers can complain to the company directly, contact the Financial Ombudsman Service, or take legal action against the company. Many lawyers specialise in travel insurance law and can offer advice regarding the likelihood of success and whether there are grounds for taking legal action. Although such claims and complaints to the FOS can be successful, it can increase distress during a difficult time if your insurance does not provide the cover you assumed it would whilst you’re travelling. To avoid this, consumers should take time to compare policies, assess their terms and conditions and discuss additional cover in order to ensure they obtain an appropriate level of cover and can fully rely on their travel insurance should they be forced to use it. n

This post has been provided by Travel Lawyers at ASB Law.

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