Insurers are on the watch for fraud from foreign parts
Companies providing overseas travel cover have to deal with their fair share of dodgy claims, reports Neasa MacErlean.
Saturday 18 August 2012
An elderly British tourist goes on holiday abroad. While away he gets a headache and it is bad enough for him to ask the local hospital for help. The medics keep him in for a few days and demand around €20,000 from him and then pursue him and his insurer for non-payment.
This true story reflects a widespread trend this year. In this case, specialist travel insurance lawyer Daniel Scognamiglio of Blake Lapthorn was called in to challenge the hospital.
"We were a bit lost as to the quantity and type of the treatment provided," he says. "We've got a number of hospitals we tend to keep an eye on."
It's an issue of which the entire UK travel insurance industry is aware.
"There are cases of over-prescribing and even phantom patients," says Steve Manton, travel industry expert of the consultancy Manton Associates.
A hospital in a popular location can treat so many British tourists it might hope to slip in a few extra names. Nearly a third (30 per cent) of hospitalisations happen in Spain, and half of these take place in Majorca and Ibiza, according to the Foreign Office's British Behaviour Abroad report, published last month.
Another worrying trend in Spain is being tackled by Axa, the UK's market leader in travel insurance. It has noticed that some Britons who have EHICs, the card which enables us to receive state medical help in other European countries, are not getting the benefit of it.
David Vincent, head of travel underwriting, accuses a major Spanish healthcare company of "diverting customers who have EHICs and travel insurance into private wards rather than accepting the EHIC and treating the customer under the reciprocal health agreement". It is working with the industry body, the Association of British Insurers, to tackle the practice.
As the end of August comes into sight, travel insurers will be dealing with hundreds of thousands of claims from the 24 million Britons which travel association ABTA estimates went abroad this summer. As well as dealing with fraudulent clinics abroad, the insurers will be trying to weed out phoney claims and those which are beyond the scope of the policies.
Mr Scognamiglio says: "Insurers are much better at identifying fraud than they have ever been."
And many fraudulent claimants catch themselves out, says Steve Manton, by, for instance, posting up pictures on Facebook from a camera which they had previously claimed was stolen on the beach.
Many people will find themselves turned down for claims because of what Mr Scognamiglio describes as "a very hot topic" – drink.
"There is no pre-defined limit as to what is too much to drink," he says. But people, mainly young men, who drink or take drugs and then end up hospitalised after they jump off a balcony or dive into a shallow pool will not be covered, as policies usually exclude reckless behaviour. A grey area is the tourist who falls over and breaks a leg after drinking some wine.
"Your glass or two of Pinot Grigio over a meal tends to be a lot less clear," says Mr Scognamiglio. "If it is less clear, insurers tend to pay out."
Mr Manton says: "You could argue that half a bottle or a bottle of wine is fine but you might find that an insurer disputes it."
Most of us would benefit from reading the terms of our insurance policies not just to understand how strict the terms are on alcohol but to discover the legion of other issues that could affect our claims.
A common problem area is medical history disclosure when buying a policy.
"A claim could be rejected if a problem has not been disclosed even if it is totally unrelated," explains Mr Manton.
He identifies another potential sore point – cancellation claims when a family member falls ill. So strict are some insurers that he suggests: "Should I ask my close relatives if they have a medical condition incase I need to go to their funeral?"
Claims will be subject to numerous checks because the sums involved can be very significant. The average travel claim at Nationwide is now £532.
Providing good documentation can be crucial in getting a claim lodged successfully, according to Mr Manton. This would include receipts when items were bought, police reports on thefts, contact details of witnesses and photographs of the scene of the event. If receipts are not available, insurers can be open-minded as to what they will accept as proof of ownership. A camera manual or camera case could be accepted at Axa, for example.
Acting fast is important – to inform the police and holiday rep, alert the insurer or even contact a specialist travel insurance lawyer (as "there are tight time limits, sometimes as low as 90 days", says Mr Scognamiglio, referring to deadlines for lodging claims or starting legal proceedings).
Going abroad in a severe economic downturn has extra perils. Not only will unscrupulous doctors try to fleece us but we will also take dubious short-cuts ourselves. If you buy a package holiday, for example, you are covered by the helpful Package Travel Regulations. If you buy the flight and hotel separately yourself you lose that protection. If you take the cheapest insurance available you may have bought yourself a policy with very narrow conditions.
Travel insurance is changing fast. Mr Scognamiglio expects the industry to set up a fraud database. Mr Manton predicts the development of more travel insurance apps, and maybe discounts for holidaymakers who use them by sending in beforehand a list of expensive belongings they are taking abroad and who accept that their location will be monitored on GPS through their smartphones.
Case study: Nationwide averts Greek tragedy
When she broke a toe at her holiday home on the Greek island of Skopelos, retired social work manager Jennifer Nelson began to get worried. Medical facilities are limited and transport is a challenge.
"They could not treat my foot on the island," she says. "I was extremely frightened. I would need to go to a hospital on the mainland and stay overnight on my own." A friend suggested she use the travel cover she took out with her Nationwide Flex account.
"Straight away they said they would take over," she says. "They organised for me to be carried from my house to Volos [a port town on the mainland]." A private motorboat and ambulances were laid on. Her fractures were diagnosed on Volos and she returned to Skopelos to see if a natural recovery would occur. When her toe did not heal she was flown back to Manchester and had two extra seats reserved for her on the plane to help her spread out.
Then a taxi took her home to Gateshead. Two months later she has been treated in the UK and recovered so well she hopes to return to Skopelos in a couple of weeks. Jennifer has spent no money herself while Nationwide has paid out £3,700. "They were absolutely fantastic," she says. "I couldn't have coped on my own.
ABTA, the travel association: abta.com/home
EHIC (European Health Insurance Card): nhs.uk/NHSEngland/Healthcareabroad/EHIC/Pages/about-the-ehic.aspx and 0845 606 2030.
Financial Ombudsman Service: financial-ombudsman.org.uk, 0800 023 4567 and @Financialombuds
Jo from Northern Ireland was less than impressed by Russell Brand's attempt to stage a publicity stunt
- 1 Nigel Farage: Me vs Russell Brand on Question Time – he's got the chest hair but where are his ideas?
- 2 Harry Potter fans can apply to the Hogwarts-inspired College of Wizardry
- 3 Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
- 4 Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
- 5 Orange Wednesdays are no more
Nigel Farage: Me vs Russell Brand on Question Time – he's got the chest hair but where are his ideas?
Shock poll shows voters believe Ukip is to the left of the Tories
Disgruntled RBS worker writes hilarious open letter to Russell Brand after anti-capitalist publicity stunt leaves him hungry
New era of cheap oil 'will destroy green revolution'
Ukip founder Alan Sked and Nigel Farage 'begged Enoch Powell to stand as a candidate'
Ukip candidate jokes about 'shooting peasants' in racist and homophobic rant
iJobs Money & Business
£Neg. (DOE) + Excellent Benefits: Guru Careers: A Finance Account Manager with...
£40000 - £470000 per annum + bonus: Ashdown Group: Java Developer / J2EE Devel...
£45000 - £55000 per annum + Benefits: Ashdown Group: An exciting opportunity h...
$125 - $175 per annum: Carlton Senior Appointments: Senior Wealth Manager In...
Day In a Page
A deceptively spacious, beautifully presented Georgian home with 3000sq ft of living space and five reception rooms
A five-bedroom Victorian home with four receptions, superb gardens and paddock in Pembury
An eight-bedroom house on the south side of the The Green with cinema, wine cellars and summer house
This 17th century beauty is full of rustic cosiness, while the detached home office means you can also run a business
This five-bedroom red-brick beauty overlooks the village green and sits in just under two acres of land
Four exclusive apartments in a Grade II-listed former medical school with 2,275 sq ft of living space and 18ft ceilings
A five-bedroom terraced house on the popular Peterborough Estate, ideally located for both Eel Brook Common and South Park
A state-of-the-art farm-building conversion on the former Cliveden Estate, with 11,420sq ft of internal space, cinema and wine cellar
A three-bedroom, 15th-century cottage with original features in the picturesque village of Sissinghurst
A six-bedroom terraced house with large south-facing roof terrace, cinema room and wine cellar
A new seven-bedroom home built in Queen Anne-style with swimming pool and parkland views in Mortimer
A listed, four-bedroom farmhouse in the rural hamlet of Rushall with detached barn, four acres of gardens and paddocks
A first-floor flat with two bedrooms, a spacious reception room and communal grounds in a leafy part of London
A three-bedroom flat with a spacious rootop terrace and balcony, accessed from a private gated courtyard
A Grade II-listed pile with six bedrooms, stables and 39 acres of grounds in Standlake
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion
Enjoy summer by the Thames in this two double-bedroom converted warehouse in Rotherhithe village
A one-bedroom, luxury apartment with private gym and concierge service in Moorgate
A four-bedroom house in Hermitage Gardens with three reception rooms and landscaped gardens