Key Takeaways
- A travel insurance claim is expected to top $4 million for a premature baby born in the United States
- The value of travel insurance claims has increased significantly over recent years, with Southern Cross Travel Insurance paying over $7.3 million for medical and evacuation claims
- Health events are the biggest driver of claims, with the US being a particularly expensive country for medical care
- Despite increasing claims, the proportion of travellers not taking insurance has risen to 20%
- The most common claims include trips and falls, gastro illness, and flu-related illnesses
Introduction to Travel Insurance Claims
The cost of an overseas trip can be extremely high, as evidenced by a travel insurance claim that is likely to top $4 million. Southern Cross Travel Insurance has released a wrap of the year, which shows that the value of claims made has increased significantly over recent years, even as the level of cover being taken has dropped. This highlights the importance of having adequate travel insurance to cover unexpected medical expenses while abroad. According to Chief Customer Officer Jess Strange, the biggest driver of claims is health events, particularly in countries like the US, where medical costs can be extremely high.
The Cost of Medical Care Abroad
The US is a prime example of a country where medical costs can be extremely high. Strange noted that the country is "by far and away the most expensive" for medical care, and that costs can "skyrocket before you know it." This is evident in the case of a premature baby born in the US, which is expected to cost around $4 million. Other examples of high-cost claims include a person who claimed $220,000 for a Covid-related illness in Singapore, and another who claimed $642,000 for an illness in Italy. These examples highlight the importance of having adequate travel insurance to cover unexpected medical expenses while abroad.
The Rise of Claims
Despite the increasing cost of medical care abroad, the proportion of travellers not taking insurance has risen to 20%. This is a concerning trend, as it leaves many travellers vulnerable to high medical bills if they experience a health event while abroad. Strange noted that "Kiwis love to travel but travel insurance is often the last thing they think about or they are not educated enough to know they should purchase it at the time of purchasing their travel." This lack of awareness and education about the importance of travel insurance can have serious consequences for travellers who experience a medical emergency while abroad.
Common Claims
Southern Cross Travel Insurance has seen a significant increase in claims for trips and falls, with over $988,000 paid in claims compared to $537,000 in 2023. The company has also paid $1.3 million to support customers with gastro illness, and $248,000 for rental vehicle claims. Additionally, the company has seen a significant increase in flu-related claims, with three times as many claims as in 2023. These common claims highlight the importance of having adequate travel insurance to cover unexpected expenses while abroad.
The Importance of Travel Insurance
The importance of travel insurance cannot be overstated. As Strange noted, "people often think ‘oh it’s a lost bag or a cancelled flight or a dropped iPhone’, they don’t think how terrifying it can be, both from a health and cost perspective, if something happens to you medically overseas." Travel insurance can provide peace of mind and financial protection in the event of a medical emergency while abroad. It is essential for travellers to educate themselves about the importance of travel insurance and to purchase adequate cover before embarking on a trip.
Conclusion
In conclusion, the cost of an overseas trip can be extremely high, particularly if a medical emergency occurs. The value of travel insurance claims has increased significantly over recent years, with health events being the biggest driver of claims. Despite this, the proportion of travellers not taking insurance has risen to 20%. It is essential for travellers to educate themselves about the importance of travel insurance and to purchase adequate cover before embarking on a trip. By doing so, they can protect themselves from high medical bills and ensure a safe and enjoyable trip.