Why it’s essential to understand your travel insurance eligibility, exclusion and limit clauses

Snowbirds, boomers and seniors can avoid unpleasant surprises and claim issues by understanding these travel medical insurance terms.

Understanding Key Snowbird Travel Insurance Terms

Understanding travel insurance policies can sometimes be challenging, particularly when it comes to terms and definitions you may not be familiar with.

One such area is understanding the differences - and connections – between the eligibility, exclusion and limit clauses of your travel medical insurance policy.

To help you better understand these aspects of your policy, we’ve broken them down one-by-one and explained what they mean, how they differ and how they are connected.

It’s essential that you always take the time to read and understand your policy, as failing to do so can have serious implications if you need to make a claim.

And remember, if you’re ever unsure about what something in your policy means, be sure to speak to your broker or agent so they can clarify it for you before you travel.

What is "Eligibility"?

The term “eligibility” is often used in two different contexts - coverage eligibility and claim eligibility.

Coverage Eligibility

Coverage eligibility refers to whether or not you are eligible for travel medical insurance coverage.

In order to be eligible for coverage, you will have to meet some initial criteria, some of which include:

  • Being a Canadian resident
  • Having coverage under your province’s Government Health Insurance Plan (GHIP)
  • In some cases, an age limit

In addition, there are some serious medical conditions that will make you ineligible for coverage. Some of these conditions include:

  • Metastatic cancer
  • Terminal illnesses
  • Any illness where a physician has advised you not to travel

If you meet the initial requirements, you will be eligible for coverage under the policy. Keep in mind that while eligibility requirements are often similar among insurance providers, they can vary, so be sure to compare if you are considering multiple providers.

Your Eligibility Status Can Change

It’s important to be aware that even if you were eligible for coverage at the time you purchased your policy, your eligibility may change if you have a change in your medical condition after you purchase your policy but prior to departing on your trip date.

Some changes to your health won’t affect your coverage or premiums at all, others may result in a premium increase, and some serious changes to your health can make you ineligible for coverage, essentially voiding your policy. This is why travel insurance providers require you to contact them if you have any changes to your medical condition – as it allows them to evaluate the changes and advise you of any effects it may have on your coverage.

Claim Eligibility

Claim eligibility refers to whether or not an expense you claim is eligible for reimbursement under your travel medical insurance policy.

Whether or not a claim is eligible for reimbursement can depend on a number of factors, including:

  • Were you eligible for coverage? i.e. did you meet the eligibility requirements of your policy?
  • Is the treatment you received or the related cost covered under your policy? Your policy will list the types of treatments and related expenses that are covered, as well as any dollar limits if applicable.
  • Was the condition you were treated for covered under your policy? i.e. if your policy has a stability clause period (i.e. 90-days, 180-days, etc…), did you meet the stability clause requirements?
  • Were you engaged in an activity prohibited under your policy when you suffered the injury or illness that required treatment? i.e. policies exclude coverage for injuries or illnesses suffered as a result of certain high-risk activities. Some common examples include parachuting, skydiving, rock climbing, car racing, certain kinds of mountain climbing, etc…

What are Exclusions?

Even if you are eligible for coverage, your policy will still contain a list of expenses that are excluded from coverage under certain circumstances or if they don’t meet certain criteria, which will be outlined in the exclusions section of your policy.

Exclusion terms and conditions do vary among insurance providers, so it’s important to compare this language if you are considering multiple providers, as some provider’s exclusion terms may be more or less suitable for your specific situation.

Your policy will list several exclusions, and while you should take the time to read and understand all of them, here is a non-exhaustive list of some of the more important ones to be aware of:

  • Unstable Medical Conditions: If your policy has a stability clause, any medical conditions you have will need to be “stable” for a specified period of time (often 3 - 6 months). If you don’t meet the stability clause requirements, and expenses related to those medical conditions will be excluded from coverage under your policy.

    To avoid this issue, an increasing number of travellers are opting for personalized policies that don’t have a stability clause.
  • Failure to Provide Truthful and Accurate Disclosure: If you do not fully and accurately disclose your general and medical information to the insurer, your claims can be denied.
  • Failing to Inform your Insurer of a Change to your Medical Condition: If you have any change in your medical condition (a) after you purchase your policy but before you leave on your trip, or (b) at any time while you are back in your home province during your coverage period, you need to inform your insurer that change. Failure to disclose a change can result in your claim being excluded from coverage.
  • Failure to Contact Your Insurer Prior to Receiving Treatment: If you fail to contact your insurer prior to receiving treatment, your expenses may be excluded from coverage. This is done so your insurer can refer you to the most appropriate medical facility and manage your care effectively. In non-life threatening situations, you should always contact your insurer prior to seeking treatment. In life threatening situations, you should contact your insurer as soon as reasonably possible.
  • Expenses Resulting from Participation in Certain Activities: As mentioned earlier, expenses resulting from engaging in certain high-risk activities can be excluded from coverage. In addition, expenses resulting from intoxication from drugs or alcohol can be excluded from coverage.
  • Expenses Not Related to Emergency Medical Treatment: If you receive unnecessary medical treatment or opt for elective medical treatment or procedures, they can be excluded from coverage.

What are Claim Limits?

If you meet your policy’s eligibility and exclusion requirements, your policy will still contain overall claim limits as well as some limits on specific expenses.

Overall Coverage Limits

Your policy will have an overall coverage limit capping the total amount of expenses that will be covered. This overall coverage limit varies from provider to provider, but common limits are $2 million, $5 million and $10 million.

Specific Coverage Limits

Some specific types of expenses will also have coverage limits associated with then. Common examples include:

  • Emergency dental treatment
  • Bringing someone to your bedside
  • Returning your body home should you pass away
  • Returning your vehicle home
  • Meal, hotel and taxi

The Bottom Line

While it may seem quite daunting to complying with your policy’s eligibility requirements, coverage exclusions and expense limits, these terms and conditions are usually quite reasonable. The key is taking the time to read and understand your policy and follow its terms and conditions. If you do that, you shouldn’t encounter any unexpected coverage or claim surprises.

Disclaimer: The material provided in the Snowbird Advisor Insurance Learning Centre is for informational purposes only and does NOT constitute insurance, legal, financial or other advice, and should not be relied on as such. If you require such advice, you should speak with a qualified professional to assist you.