Written by: Griffiths & Armour on: 04 May 2021

Personal Travel Insurance Update: New Guidance on Pre-Existing Medical Conditions (PEMCs)

Travelling beyond our local area or internationally has been a luxury very few of us have been able to enjoy in recent months. However, a combination of the impact of lockdown and vaccine roll-out amongst differing countries’ populations means further clarification on how and when travelling abroad may begin again is expected in the not too distant future.

Naturally, our thoughts might be turning to those early provisional plans for that long-awaited trip to a favourite holiday destination or visit to family living abroad. Another consideration you should also be aware of is the travel insurance market you may experience when seeking to renew your travel insurance policy is likely to be very different compared with your last renewal period.

Why is this?

Despite a significant downturn in the numbers of people travelling over the past 12 months, the travel insurance market has been disproportionately affected by the Covid-19 situation. Insurers are expected to pay around £275M in coronavirus related travel claims (mainly for cancellations) and to put this into perspective the payout dwarfs the £62M payments following the Icelandic volcanic ash cloud in 2010 and is double the entire travel cancellation payments for 2019 . This has led insurers to take a more forensic approach when offering travel insurance to consumers, carefully considering what is and isn’t covered much more closely and, when it comes to any Pre-Existing Medical Conditions (PEMCs) you or your family may have.

So, what has changed?

In short, your obligations haven’t changed at all. You will no doubt be aware that when you have purchased travel insurance in the past, PEMCs have always had to be declared to the insurer (if you had previously purchased directly) or via your broker. What has changed is how some insurers are now choosing to take a more ridged approach in factoring PEMCs into the cost of insurance when, compared with the past, some might have taken a much more lenient approach to some PEMCs, particularly on less serious conditions.

How might these market changes impact on you and other consumers?

Put simply, consumers who purchase personal travel insurance are likely to experience increased premiums for similar levels of cover and in some cases, reduced cover than when purchased before the global pandemic. In some extreme cases, insurers may not offer cover at all.

What measures are being taken to help consumers to secure their travel insurance if insurers choose to increase premiums significantly or withdraw cover for PEMCs?     

The Financial Conduct Authority (FCA) have recently published new guidance to insurance brokers which is due to come into effect towards the end of April. This guidance is designed to help brokers to address these challenges on your behalf and ultimately enable consumers to obtain cover for PEMCs at a competitive premium.

Although the guidance is aimed at making cover more widely available, this has also had an impact on how insurers approach providing cover.

To help provide you with clarity on how this guidance may influence how we act on your behalf when negotiating your travel insurance renewal with insurers, we would like to share some of the most frequently asked questions (and answers) that have been collated by our Private Clients team over recent weeks.

Frequently Asked Questions

What defines a Pre-Existing Medical Condition (PEMC)?

PEMCs are usually defined as an illness or an injury you had prior too, or at the time of, taking out a travel insurance policy. They can also include anything that you are awaiting on treatment for, including surgery, or a prognosis that is pending the outcome of an ongoing medical examination.

When will I need to advise Griffiths & Armour of any PEMCs?

If you are a Griffiths & Armour Private Client and we arrange your personal travel insurances you will need to advise us;

  1. prior to renewal of your policy
  2. throughout the period of an existing policy
  3. prior to travel if you undergo any new treatments not previously declared.

Our advice to our Private Clients is keep us updated as early as possible. The sooner we are aware of any changes to your medical condition, the earlier we can contact the insurer on your behalf to understand what, if any, implications that may have on your existing cover. We can gather the information that is needed to ensure you have all the facts and choices available well in advance of your trip and avoid any last-minute stress before you travel.

When does the new FCA guidance come into effect?

The new guidance is effective from the 26 April 2021.

How will this new guidance benefit me and what are Griffiths & Armour doing to help their clients with this?

The new guidance is designed to ensure cover for PEMCs is possible to secure, at a competitive premium. As always, your personal insurance broker at Griffiths & Armour will be contacting you well in advance of the renewal date of your policy to discuss in complete confidence any PEMCs you may have.

After we speak with you, the following will occur:

  • We will then approach your existing insurer to obtain their terms.
  • If their terms are affected by the changes in the travel insurance market, we will then approach a specialist insurer on your behalf and obtain an alternative quotation.
  • We will tell you:
    1. If any restrictions have been imposed on your travel cover because of your PEMCs.
    2. If cover cannot be offered due to your PEMCs.
    3. If cover can be provided but the premium offered to include your PEMC adds £100 or over to the cost.
  • Options will then be presented and discussed with you so you can share your views and thoughts prior to moving forward with the renewal of your travel insurance policy.
  • If the options presented are not suitable we can also arrange to access to a directory launched by the British Insurance Brokers’ Association (BIBA), that lists companies that may be able to help you secure personal travel insurance. The directory can be accessed by either clicking here or calling 0370 950 1790.

Will the new FCA guidance apply to any travel insurance cover in place for my business travel?

In short, no. The new FCA guidance only applies to personal travel insurance policies.

What type of information will Griffiths & Armour require from me?

To help us negotiate cover for you we will need to know:

  • Full details of your medical condition, including date of onset and current symptoms.
  • Full details of what treatment or medication is taken and how often.
  • Full details of any future treatment or investigation that you are aware of.

For your convenience and to help you gather and send this information, we have produced a simple health questionnaire that you can use in order to declare your treatments and provide any relevant information to your Griffiths & Armour Private Client insurance broker. This health questionnaire form can be downloaded here.

If you have any questions relating to this article or any other insurance related matter, please get in touch by sending your enquiry directly to Ken Harris (below) or with your usual point of contact at Griffiths & Armour.