With summer on our doorsteps, clients’ thoughts often turn to travel, whether it’s out-of-province or out-of-country. And while a recent BMO study indicated that fewer than half of Canadians buy travel insurance, brokers and advisors know that for those who do purchase insurance, the big key is filling out insurance forms correctly in case a claim has to be made.
Advisors/brokers say there are a number of potential pitfalls clients need to be wary of when filling out forms. While some questionnaires can be fuzzy or repetitive, it’s the role of advisors/brokers to get their clients to answer all questions on the forms fully and honestly.
“One must carefully guide the client by underlining the importance of answering every question honestly,” said Joanne Parent, director, Sales and Development with Quebec Blue Cross in Montreal. “The information gathered from the client depends on the quality of the advice from brokers and advisors.”
Getting clients to answer honestly is not as easy as it may seem. Clients have no problem answering when they’re leaving and when they intend to return, but when it comes to health-related questions, many believe they are hale and hearty even though they take medication.
“People always say what great shape they’re in until I ask them what kind of pills they take,” says Heather Freed, an independent certified financial planner in Toronto. “I think they don’t want to worry about their health. I ask them the question about the pills because that usually brings up that there is indeed something wrong with them.”
There are some travellers who are well aware of what their coverage does and does not contain, including pre-existing conditions, and know they won’t qualify if they answer truthfully, says Ms. Freed. Travellers need to understand that insurers have every right to go to doctors to get history, she adds. If the insurer discovers that clients lied on a form, the insurer can deny a claim that may have cost the traveller tens of thousands of dollars.
Clients should think about filling in the questionnaire as if it were an open book exam, says Martha Turnbull, Head Auto, Travel & Property Claims, RBC Insurance in Toronto. “Clients need to write down when they saw the doctor and what prescriptions they take,” she says.
While most insurance forms are basically the same, there are some differences that can make all the difference to a client, says John Wilson, a multi-line insurance broker with Butler Insurance in Niagara Falls, Ont.
“To me, the job is putting the person in the best position they qualify for,” says Mr. Wilson. “I have had times when I have a husband with one company and a wife with another company just for that reason.”
Often people find the wording on forms confusing. So, for example, if the questionnaire asks if the client has ever had treatment for a specific ailment, a client can rightfully answer that they have never had surgery or take pills for it. But, says Mr. Wilson, some insurance plan definitions also include investigative testing.
“It could be something as simple as a concerned look-see and the results could have been negative, but the fact that the look-see happened in many cases, makes this a yes,” he said.
The majority of Mr. Wilson’s clients are seniors and snowbirds who need to be reminded that even if they go across the border for a day of shopping, they need coverage. That’s why he recommends his clients get annual travel insurance, which is usually made up of a 30-day plan plus a top-up.
Many travellers have 30-day personal or group travel coverage and mistakenly believe they are covered for the first 30 days of a longer, six-week trip. But in order for even the first 30 days to be valid, they need to get the additional two-week top-up, says Ms. Freed. “You can buy top up and it’s not expensive and it’s not hard, but people have argued with me about that.”
Clients also have to read the fine print. Insurance companies have specific age thresholds, which may vary from insurer to insurer. Some “gold” credit cards may provide travel insurance that goes up to age 75, says Mr. Wilson. While they don’t require cardholders to fill in medical questionnaires, they do have a pre-existing exclusion clause, requiring a certain period of stability before any given departure. Before age 64, the cards require 180 days stability, but once you turn 65, that may increase to 365 days. “That’s a tough nut to crack,” says Mr. Wilson. “You get someone with a simple change in blood pressure medication and it’s over with.”
To help clients through the procedure, he emails them the blank form so they can read along with him as he asks the questions. Ms. Freed fills out the answers with the client over the phone, but both ask clients to review the form to ensure the accuracy of the information, including birthdates and dates of departure and return.
Ms. Parent says it’s also important to cover the entire duration of the trip, including the dates of departure and return and that the insurance be purchased prior to departure.
She says Quebec Blue Cross keeps brokers and advisors up to date on travel insurance issues, including changes to forms, via online tools, as well as integrating a validation process, helpful tips and explanations. There can also be face-to-face training sessions and there’s a call centre dedicated exclusively to distributors.