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The Money Management Newsletter: General Interest
Getting Sick when outside of Canada:
A look at the cost of travel insurance

Most people who love to travel, or those who travel frequently know the importance of purchasing a comprehensive travel insurance package before leaving on a trip. Travel insurance protects you out of province or country from unforeseen accidents or illnesses. Without travel insurance, the cost of prescription drugs or hospital care can skyrocket.

So, what is your best bet when looking into the purchase of travel insurance? Shop around.

Competitive rates

Most insurance companies do offer some form of travel coverage, bringing into consideration factors such as age, degree of coverage and medical health condition to determine their rates. It is important to bear in mind that each companies' rates will differ and it is in the customers best interest not only to focus on price but also on what type of coverage is offered.

Deductible savings

A little extra research on the part of the traveler can sometimes lead to impressive savings and may be worth the time and effort. For example, some insurance companies require the traveler to pay a deductible in addition to their travel insurance. The deductible amount can vary depending on age but often results in lower insurance rates. Other providers may not require a deductible but instead present it as an option for the customer to pay in order to receive reduced rates. Insurance agencies may also have additional deals for those purchasing more than one policy or for those going on more than one trip.

Medical questionnaires

Depending on the insurance company, prospective travelers might be required to complete a medical questionnaire before they are assessed a rate. These questionnaires are designed to determine the health of the customer and in many cases must be completed regardless of the age of the person requiring coverage.
The results of a survey (see below) of 23 randomly chosen insurance companies conducted by Fiscal Agents Financial Services Group in Oakville, Ontario, shows that the completion of a medical questionnaire to determine rates is becoming more popular, especially for those between the ages of 61 and 81. A number of the companies surveyed said that they have switched to this method within the last year and require a questionnaire to be filled out in all cases.

How much is my deductible?

Nine of the providers polled required their customers to pay a deductible ranging from $200 to $250 U.S. and $250 Cdn. and were able to provide slightly lower rates for travelers between the ages of 61 and 76 than companies not requiring a deductible. Prospective travelers around the age of 81 should be aware however that paying a deductible did not offer much of a lower rate on their insurance and in one case their deductible was raised to $1000 Cdn.

Non-deductible coverage

For companies not requiring a deductible from their customers, of the companies we surveyed, Voyageur Insurance provided the best overall rates for travelers between 61 and 76. Thomas Cook's snowbird insurance package offered the best price for travelers aged 81.
CIBC came in as the highest for those looking for coverage at the age of 61. Blue Cross (Ontario) charges most for their coverage between the ages of 66 and 71. Bank of Montreal was the highest for age 76 and Atlantic Blue Cross rated most expensive for insurance over the age of 81.

Your best chance at success when purchasing travel insurance is to ask a lot of questions and become very comfortable and familiar with the coverage that you eventually decide on. Travel insurance, like any other type, is there to protect you and will serve you best when you find the one that suits your needs.

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