Travel Medical Insurance - Are You Really Covered?

by Kris Bonn

We Canadians love to head south during the winter to escape the snow and ice. When we leave Canada we are also leaving our universal healthcare. Medical treatment in the United States and other countries can be prohibitively expensive. That is why it is always prudent to buy travel medical insurance before you leave the country. The problem is most travel medical insurance is sold over the phone and in a peremptory manner. Too often care is not taken to carefully go over the application and that can be a serious problem.

 Insurers will commonly deny claims based on an allegation that the insured misrepresented his or her health condition when completing the application for insurance or had a pre-existing health condition. The law in Ontario requires an applicant for insurance to disclose to the insurer all facts within his or her personal knowledge about his medical health. If the person fails to disclose relevant health conditions or medical appointments, the insurer may deny coverage. This duty exists even if the insurer does not specifically ask for the information. The most prudent and safest course of action is to disclose all medical information and hold nothing back when applying for travel medical insurance. Err on the side of providing too much information as opposed to too little. Further, if your medical condition changes at all between the time you applied for insurance and your trip, you should disclose that change. For example, in Falvo v. Allstate Insurance Co., 2009 ONCA 334, Mr. Falvo applied for travel medical insurance on January 29, 2004. His application was accepted and Allstate provided him with travel medical insurance. On February 2, 2004, before he left for his trip, he met his family doctor who evaluated him for chest pain. The doctor cleared him of any medical problems and said he was safe for travel. He did, however, prescribe Mr. Falvo with a new medication. Mr. Falvo reported the chest pain and his doctor’s appointment to Allstate before leaving for his trip. The insurer confirmed he was still covered. When he was in Florida Mr. Falvo experienced chest pain and he was hospitalized. He left with a bill for $53,224.19. Allstate refused to cover the costs claiming that Mr. Falvo had a pre-existing health condition that voided his coverage. The court disagreed and ordered Allstate to pay Mr. Falvo the cost for the hospital stay. The court relied on the fact that Mr. Falvo had disclosed to Allstate that he had chest pain and saw his family doctor before he left for Florida. Once Allstate had this information and confirmed that he was still covered, it could not resile from that position.

The lesson from this case is to always be upfront and truthful when completing insurance applications and always update information before you leave on your trip. While you may pay more for the insurance coverage, paying an extra few hundred dollars for insurance sure beats a bill of over $100,000 should you need medical treatment.