Mental Health & Travel Insurance: The Fight For Fair Pricing

Travel insurance is essential towards covering the financial repercussions of something going wrong before or during your trip. However, nearly half of travellers previously diagnosed with a mental health condition choose not to disclose it with their insurer. There seems to be a general perception that insurers will immediately categorise such travellers as ‘high-risk customers’ which can drive up premiums or mean they simply will not offer cover.

In the past, the key problems associated with disclosing conditions are higher prices, unreasonable exclusions and insurance providers not tackling the disclosure of such conditions with sensitivity and tact.

High prices
In the past 5 years, 43% of people who have experienced mental health problems believe that the price they were quoted for their travel insurance has been ‘unfair’ or ‘very unfair’. Of these, 13% chose to travel without insurance altogether. Many acknowledged that that’s a handful of travellers diagnosed with mental illness could pose a higher risk when abroad, there are many cases which are historic, periodic or well-managed, and have little to no bearing on their day-to-day lives.

Money and Mental Health Policy Institute found that there was a price increase of up to 81% for long-term stable depression which shot up to as much as 462% for bipolar disorder. Even for historic cases, the price increase was as high as 82%. For more severe problems, such as where the person has previously been sectioned or hospitalised, many insurers would decline cover altogether. For those who would provide cover, the price increase ranged between 126% – 462% for depression and a staggering 2119% for bipolar cases.

Exclusions
It could be questioned as to why the price skyrockets so much when any incident surrounding the insured’s mental health isn’t often covered under standard travel insurance. Insurers sometimes put blanket exclusions on conditions such as depression, but the complexities of mental illness can vary so significantly, this translates unfairly to those at minimal/no risk. This has resulted in one in 5 people who have experienced mental health problems travelling without cover for their condition.

The stigma of disclosure
Studies show that 54% of people with mental health conditions struggle to disclose their condition over the phone, feeling embarrassed or ashamed. Providers are not always considered to be understanding and could inadvertently ask insensitive or excessively probing questions. One of the respondents to the survey stated: “it’s hard enough to speak to mental health professionals about this stuff, never mind anyone else. This limits the traveller’s capacity to shop around which inevitably means they miss out on more competitive policies.

What’s being done?
The Financial Conduct Authority (FCA) has committed to take action against these concerns by setting up a new signposting service which targets any lack of transparency when it comes to pricing. They will work with the insurance industry to target specialist insurers who work to understand pre-existing medical conditions in order to quote a fair premium which is reflective of the actual risk to the individual rather than taking a blanket approach.

It’s essential that you disclose the necessary information to insurers or else your policy could be invalidated. This disclosure doesn’t need to be stressful, though. When working with a broker who understands the complexities of mental health, they can do the work for you to find a policy which suits you, whatever journey you’re on.

NC Insurance

For additional information on staying safe whilst travelling, read our past blog post: Cancellation cover & Travel insurance- What you need to know

At NC Insurance we believe that everyone is entitled to fair, affordable travel insurance and understand that there are vast differences in how individuals are affected by the same condition. If you have a pre-existing condition, whether it’s physical or mental, we can help arrange a policy which takes your full set of circumstances into account. Contact our friendly team on 0191 482 1219 or request a quote on our website.