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Got a Medical Condition? Here’s How to Beat Price Hikes for Travel Insurance

Like many things at the moment, the cost of travel insurance is on the rise. And if you happen to have a medical condition, you are likely to feel the sting more than most.

Some stories about exactly how much people have been asked to pay for travel insurance recently have made headlines. Take this one about a cancer patient quoted £1,800 for travel cover, for example. That was more than seven times higher than the price she was quoted two years ago.

Being hit with such a startling price hike would be a shock to anyone. And if you have a medical condition, reading such stories naturally makes you worry what your next travel insurance quotation will be. 

Could you find yourself in a situation where you can no longer afford to go on holiday, all because the cost of travel insurance is so high?

Fortunately, while prices are undoubtedly on the rise, we’re still a long way off that being a genuine concern for most people. Higher prices are a reflection of the fact that, in the wake of COVID, insurers are being choosier about who they offer policies to. But there are still providers out there who are happy to cater for people with medical conditions, and do so at reasonable prices.

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Why are travel insurance prices on the rise?

Let’s start by explaining why you are likely to pay more for travel insurance this year. It isn’t just people with medical conditions who are facing higher costs. According to comparison site Go Compare, travel insurance is now on average 38% more expensive than it was prior to the pandemic.

Other research shows that the average cost of a policy shot up by 50% between August 2019 and August 2020, with the price hikes slanted heavily towards older travellers.

So why has the pandemic led to more expensive travel insurance?

There are a number of factors at play here. One is that insurers have found themselves having to pay out more than they did previously, especially for things like COVID-related cancellations if people can’t travel because they test positive. As with any kind of business cost, eventually these increases have had to be passed on to the customer.

The pandemic has also made travel insurance firms more cautious. Insurers deal in the business of risk. Every policy they sell carries the risk of having to pay out on a claim. Insurance companies remain profitable by hedging the risks of payouts against the prices they charge and the number of policies they sell.

When the risk grows, not only do many insurers put up their prices, many also cut back on the number of policies they sell. These will often be the ‘riskier’ products, like travel cover for people with medical conditions. 

Fewer insurers offering cover for medical conditions means less competition, which allows prices to creep up. At the same time, rather than pull out of the market completely, some providers will put their premiums up to eye-watering levels almost to act as a deterrent. They don’t really want to cover you, so they use price as a barrier.

Why are people with medical conditions considered a greater risk?

But why is selling travel insurance to someone with a medical condition considered ‘risky’? It’s all to do with the fact that travel insurance covers you for medical treatment if you fall ill or have an accident abroad.

Even in countries like the UK which pride themselves on ‘universal’ free healthcare, this only applies to citizens and residents of the country. Foreign visitors have to pay, and the rates are far from cheap. In the UK, for example, tourists are charged for NHS treatment at 150% the cost rate. In other words, there’s a profit margin there, which is standard for private medical treatment.

Falling seriously ill and needing hospital treatment can therefore be very expensive. That’s a big reason to take out travel insurance. The medical schedule of a travel insurance policy will nearly always have a seven-figure payout limit, reflecting just how expensive a worst case scenario of a lengthy hospital stay and/or medical repatriation can be.

Medical cover is also the biggest risk travel insurance providers take on. Even relatively minor treatments can end up being considerably more expensive than the cost of a cancelled holiday or lost luggage. Insurers are therefore keen to cap the level of risk they take on. Standard policies only provide cover for general emergency treatment, excluding anything specific related to particular medical conditions.

From the insurer’s perspective, if you have a medical condition, there is an increased risk of you needing medical treatment while abroad. Not only that, but covering medical care for your condition means paying out for additional treatments, with their own additional costs.

That’s why travel insurers charge more for including medical conditions. It’s also why more and more have started to decline providing cover for medical conditions, because they don’t want to take on the extra risk.

How to find medical travel insurance cover at an affordable rate

One of the big frustrations for people with any sort of medical condition is that travel insurance companies often don’t seem to want to know anything more than whether they have a condition or not. There’s no consideration of how fit and healthy they are, how well managed the symptoms are, what their doctor’s opinion is on their suitability to travel. All that matters is that they have a condition, and that’s enough to either slap on a huge premium or decline cover altogether.

But that’s not all insurers. Those that specialise in medical travel insurance cover do things differently. Rather than simply treating a medical condition as an extra risk, they put together policies that include medical cover for specific conditions. They will use a questionnaire to find out more about your medical history and tailor the policy accordingly.

This means that you end up with medical cover shaped to your individual needs, making sure you get the right protection if you do fall ill. But because such specialist providers base their business around offering such bespoke cover, there is no incentive for them to put their prices too high. You are therefore always likely to get the best deal by going straight to a medical travel insurance specialist.