Buying health insurance for your next foreign trip: Don't fall victim to the fine print

A Saskatchewan man's nightmarish trip to the United States is a cautionary tale for those who travel outside of Canada.

If you are taking a trip soon, experts say, now is the time to look into purchasing travel health insurance and, they emphasize, reading the fine print before you buy.

When Louis Lamothe, 72, from Halbrite, Sask., suffered a stroke while vacationing in Arizona, his family got another dose of bad news: Their insurance claim had been denied and they would be on the hook for the $56,000 flight home, as well as other hundreds of thousands of dollars in medical bills yet to come.

Lamothe, who is currently recovering at Regina General Hospital, failed to disclose a change in his cholesterol medication. The 10-milligram pill he had been taking was increased to a 20-milligram dosage in July, three months before he left for the U.S.

Blue Cross declined Lamothe's claim for his hospital stay or flight home because they weren't told about the 10-milligram dosage increase. The family say they don't know why he did not disclose the change in dosage, but say it was not deliberate.

Will McAleer, executive director of the Travel Health Insurance Association of Canada, says it is important to disclose underlying medical conditions before your trip.

"The insurers have a difficult time when they are looking at an individual to determine if a claim is payable or not because they would need to reach out to the family physician to get a report which would have showed a dosage change," he said, referring to the possible reasons why Blue Cross took 16 days before informing the family their claim had been denied.

Even a reduction in medication can affect the coverage, McAleer says.

"The family has the right to appeal the claim decision," McAleer said. "Some questions to ask would be if I had notified of the dosage change at the time of application would you still have given me the policy or declined," he said.

"Even if the denial does come through, you can appeal the decision, but you do have the responsibility to provide the information before travel."

The insurance company declined an interview.

But in an email statement on Tuesday, Blue Cross said privacy requirements prevent them from providing details about the claim and their decision, but that all decisions undergo a formal review at multiple stages involving both internal and external experts.

"Less than one per cent of personal travel claims are denied due to false statement or application omission. When claims are denied, assistance to facilitate repatriation arrangements is always offered to plan members to alleviate that administrative burden during a time of need, and plan costs are refunded," the statement reads.

'Know your trip'

"Know your trip" is one of the tips that McAleer recommends. 

"Are you taking a trip where you're just going to go and sit by the pool? Or are you going to be a bit more adventurous and try bungee jumping or skydiving and other high risk activities. And then check whether your insurance covers those." 

Some policies will cover such activities, he says, but the customer might need to buy a little added protection . 

McAleer says before the pandemic the occurrence of such tragic incidents was fairly low and that "number continues to be low." 

In his travel insurance association's most recent claims survey, done before the pandemic, 94.3 per cent of submitted claims were paid by insurers. 

"More people are buying travel insurance since the pandemic, but make sure you're doing the homework, even if it isn't a large cost in the overall travel budget."

Tijana Potkonjak, a lawyer at the Toronto law firm Devry Smith Frank LLP, called Lamothe's situation "sad but not unique" when it comes to insurance law.

"You don't see a lot of them in the court as most of them settle out of court where the insurer pays a percentage of what is owed under the contract — in this case medical bills —  without admitting that they owed that money in the first place," she said.

Potkonjak said both the insurer and insured are part of a good faith contract, and the insured has the duty to share all the relevant information or "material." 

The 10-milligram dosage increase, she said, would qualify as a "material" change, but other subjective factors would play a role in the final decision.

"There would be a subjective and objective test that the court will use to determine whether this person knew that this change was relevant," she said.

"They will take into account his age of 72 years and Lamothe's sophistication, knowledge and background. Older people, in my practice, are often denied travel insurance coverage once they get sick and make a claim."

Potkonjak says it is difficult for some people to track their frequently changing medications and then inform the insurance company: "There is a common law rule that someone doesn't need to disclose what they are not asked."

However, she added, some questions are worded generally. 

"If there is ambiguity in the contract, it is interpreted in the favour of people buying or being covered by the insurance," she said.

Diagnostic tests, for example, would mean providing blood work, MRIs, ultrasounds, scans and such.

"We are seeing more and more of such cases recently," Potkonjak said. "It could be because of the surge of travellers after the pandemic," she said.

"An average person doesn't know or overlooks these things in the fine print of the policy. Larger print and extensive phone calls to explain the policies can assist people better."