Whether you’re travelling for a few weeks or a few months, there’s no denying the fact that travel insurance is a necessary evil. We’ve all heard horror stories of people being caught with bad travel insurance or even worse, none at all. For some of these people, being caught in an medical emergency ended up costing them their life savings.
A lot of people choose to take their chances. Maybe it’s the fact that as Canadians we take healthcare for granted. We don’t really give it the praise it deserves when compared to some places in the world and the majority of the time we don’t even think about it until we need it. The truth of the matter is that despite all the criticism, Canadians have some of the best healthcare in the world when compared to cost and treatment equality for all.
Getting back to insurance, one aspect that is sometimes forgotten in regards to purchasing travel insurance is that most policies take effect the moment your feet leave Canadian soil, not when you purchase the policy. The agreement you sign when purchasing your insurance is contingent that nothing in your health status changes from when you purchase your insurance until you leave the country.
That means if you bought your insurance months before your trip, suffered something major (or even minor) in the interim, then proceeded to travel without informing your travel insurance provider, your insurance might be null and void regardless of whether you’ve already paid for it. That’s a bit of a punch in itself, however this post isn’t about that.
The dangers of relying on an extension for health insurance
Now this scenario doesn’t apply to everyone, however it’s still good to know. Most travel insurance companies allow you to extend your current travel insurance plan if you’re travelling longer than your current insurance allows. Whether you’re topping up a multi-trip policy, extending the perks of an included credit card travel insurance policy or have decided to travel longer and need an extension on you’re existing single trip policy they’re all pretty similar.
When you extend your existing coverage, you’re essentially purchasing another policy.
In turn, most extension policies are similar to how travel insurance in general works. That you are only covered for pre-existing conditions if the insuring company knows about them ahead of time and it’s included in your policy. Seems a little convoluted that you’d know about an accident ahead of time but essentially when you extend your existing coverage what you’re usually doing is purchasing another policy.
Clear as pudding, right?
To make this clearer I’ll give you an example. A retired couple in good health leave Canada to spend the winter down south. They already have a yearly multi-trip travel insurance plan that will cover them for 30 days at a time outside of Canada. Since they want to spend three months down south they purchase a two month extension on top of their existing plan with the same company.
All is going great for the first few weeks then suddenly, two weeks into the trip, the wife slips and falls and breaks her wrist and arm in several locations. The break is so bad that they need to put a rod and a few screws into her arm so that it heals correctly.
In comes her insurance company. They do a great job and everything has been taken care of and all the bills paid in a timely manner. The couple are very thankful that they thought ahead and bought a policy.
The problem arises when the woman needs to get the rod removed. For it to heal properly, it needs to stay in her arm for three weeks. Since her multi-trip policy expires at the end of the month, the minor surgery she needs to remove the rod falls onto her extension policy. The problem is that as far as her new extended policy is concerned, the rod is now a pre-existing condition and the insurance company won’t pay to have it removed.
The woman now finds herself in a predicament. The insurance provider isn’t evil, it simply sees that extended policy as a new policy. Rather than a true extension of the original policy, the two policies are seen as separate entities in their eyes. This is normal since when a claim is made, all costs are handled via the policy in place when the accident happened.
The couple now had to decide what to do. They still had over two months left on their trip and wanted to remain in the south. The travel insurance company, for their part, gave them the only thing they could that would fall within the 30 days, a free flight home.
That left them with a difficult choice, they could either fly home, remove the rod and then pay for the flight back south to resume their trip or they could pay the cost of getting the rod removed themselves and continue their trip immediately. Either way it was going to cost them money.
If you’re not willing to come home sooner than intended in case of a medical emergency, it isn’t a bad idea to make sure your covered for the entire duration of your trip with one policy.
This couple learnt a valuable lesson that sometimes extending an existing policy, especially when travelling for extended periods, might not always be the best decision.
Of course, this always depends on your exact policy and might be fine in certain situations. However, if you’re not willing to come home sooner than intended in case of a medical emergency, it isn’t a bad idea to make sure your covered for the entire duration of your trip with one policy.
Of course, even that is often up to the policy makers discretion with some companies opting to airlift a sick patient home for local treatment rather than paying exorbitant fees out of country. That’s a topic for another time, though.
This post wasn’t meant to dissuade you from ever extending your existing insurance, merely to inform you of possible complications. To be honest, we usually carry a yearly multi-trip policy and oftentimes extend it for our extended travels. The reduced costs make it an attractive proposition and we’re fine with returning early if we need to for health reasons. You just need to weigh the pros and cons for yourself.
If you have any questions, contact your insurance provider for more information and don’t forget to read the fine print on any policy you’re currently considering.
Looking for a new policy? Start off with a free quote from Kanetix.ca. It’s a great place to begin your search as it allows you to compare travel insurance costs from several different Canadian companies at once. From there check out any of our reviews up top to find the one that’s perfect for you.
*As always, the information on this page is from one Canadian traveller to another. We have spent years abroad and have gotten to know the ins and outs of the industry however we are not travel insurance agents. If you have any travel insurance questions, please talk to a qualified travel insurance agent or broker. Finally, policies and plans can and do change all the time, without warning, so always consult your insurance policy since that is the legal document to which you are agreeing to.
*This article is only intended as general advice. Please check your own policy carefully.