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From The MD's Desk: Inside The World Of Cruise Insurance

When it comes to insuring cruises, we’re proud to say our Managing Director Kate Huet is one of the world’s most knowledgeable and experienced authorities on the topic.

Kate is a leader in the travel insurance industry – in addition to heading up International Travel and Healthcare Limited (ITHC) which includes onestop4, Safe Journey, Fit-4-Travel, and InsureMyCruise, she is Chairman of the Association of Travel Insurance Intermediaries. She regularly shares insights with the organisations and associations that keep the travel industry running, including the UK Foreign and Commonwealth Office (FCO), Financial Conduct Authority and many other institutions, to ensure that UK residents can rely upon their travel insurance.

Kate is also frequently invited to speak with insurers, cost containment, assistance and other insurance-related service providers at international conferences – including a conference in Southampton last month.

During this conference, Kate presented some facts and insights into the changing world of cruise insurance. We asked her to share some highlights of what the industry is talking about…

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ITHC Managing Director, Kate HuetI wanted to take this opportunity to share some interesting (and some alarming) cruise insurance information.

The cruise industry is going through so many changes, it is growing massively with new ships and new types of cruises coming into the market. As an insurance provider it’s an ongoing requirement for us to ensure that your cruise insurance is keeping up with what is being made available. It’s therefore important for you as a cruise traveller to be aware of how travel insurance works.

The first point is not to assume that your travel insurance covers cruises – you must check this, because as the cruise market has grown, travel insurance providers have had to make a decision about whether their policies will cover cruising.

Some have decided that they will make specific policies available, which include the many and various risks associated uniquely with cruising, whilst others have excluded cruising from their cover completely.

The mid-ground is a standard travel policy which allows cruising for an additional premium, and it is these policies which are unlikely to have all of the cruise-specific benefits included – such as missed port, confinement to cabin etc. – so you really do need to know what you want from your travel insurance before you buy, and to check that what you want is included on terms that you are happy with.

 

Did you know:

- 80% of our cruise insurance claims are for cancellation – that means they’re cancelled before embarkation, so it really makes sense to have that cruise insurance from the minute you’ve made your booking.  No-one books a cruise and at the time thinks they will have to cancel, but because cruises are booked so far in advance, life and its obstacles have more chance of getting in the way.

- It doesn’t matter where in the world you are cruising, or whether you’re on a luxury cruise, exploration vessel or a “cheap and cheerful” type of cruise; most of them charge medical bills in US Dollars, using USA-level tariffs. Those are eye-wateringly high!

- Even a short on-ship hospital stay can cost a fortune. We recently had a case of a passenger who spent 22 hours in a ship’s medical facility – that alone cost $17,000.

Then he had to be disembarked, spend 3 days in hospital, before he and his wife were medically repatriated.

Their total claim was £76,000!

In 2010 that $17,000 would have been under $2,000, so you can see inflation is rampant. Onboard medical facilities are a profit centre for those who operate them, and frequently this is outsourced by the cruise company to a specialist marine medical services provider.

A ‘touch’ of gastroenteritis will cost on average $7,000 and this happens regularly, as do claims for respiratory infections of a similar amount – these are costs that would ruin a holiday far beyond your return home.

 

Standards Are Changing 

There are so many different types of cruises now – and each type of cruise creates a whole new set of risks. These are some of these ‘newer’ risks that every cruise passenger should be aware of:

- Have a look at all the activities and shore excursions that are available, and check whether you need additional cover. Don’t assume that your standard cruise/travel insurance policy automatically covers every activity on board or those that could be undertaken when participating in on-shore excursions e.g. Hot Air Ballooning. If heading to Arctic or Antarctic regions you may need Winter Sports cover for glacier walking or sledging.

The latest craze of Arctic and Antarctic “challenge plunges” (into very cold water for 1 minute) is a good example of an activity that is prevalent – whilst it is not an activity you will see specifically mentioned on any cruise related activity list. You need to be very sure you are fit to do it and anyone with heart, circulatory or respiratory conditions would be well advised to avoid. You have two requirements to consider:

A) to behave as if you are not insured and not to expose an insurer to unnecessary risks.

B) to ensure that you have declared all your health conditions.

So a quick dip in the Scotia Sea comes with risks that your insurer will struggle to get their head around. You are also too far from a mainland to get a rescue vessel to you if you need one.

- Small boats that ferry you to watch walrus hauls or go whale watching are unlikely to be covered by many standard policies.

- Rough terrain trekking (e.g. glaciers) – many people do this with a guide but with no personal experience or the necessary level of fitness, and sometimes even with limited mobility. Which means it’s unlikely to be covered unless discussed when you apply for cover.

- Look out for buy-one-get-one-free (BOGOF) deals. There can be booking confirmation and cancellation confirmation discrepancies which affect your ability to make a cancellation claim in some instances.

If you are insuring the total value of a cruise that has been purchased on a BOGOF deal, then be sure that your booking confirmation shows the cost per passenger if travelling as a couple.

If one passenger is free, then you must insure appropriately, because if one cancels and the other free traveller still travels, you will want to claim for the cancellation of the non-traveller.

- Beware of over-indulgence (this applies to food and alcohol).

It’s responsible for so many unpleasant cruise experiences and on-board medical visits. Keep mobile because too much of what you like combined with lack of exercise, is a recipe for trouble.

- Over-the-counter (OTC) medication also causes problems. When medication is self-administered and unsupervised it can react with prescription medication and affect any treatment you receive on board. Always check with your doctor before buying OTC medication, and list the condition that you are taking it for on your medical declaration. Regular use of laxatives for constipation, and antacids for indigestion have given rise to claims because of interaction with prescribed medication – if you suffer from constipation or indigestion, then make sure you declare this.

 

Many years ago, before I set up ITHC, I experienced being on the receiving end of an inferior travel insurance and received exceptionally poor emergency assistance service provision. I found myself in a truly desperate situation. I knew I had to do something about it, and that experience shaped my career path into this area of financial services. No-one should go through what my family and I did.

That’s why I wanted to be part of creating the comprehensive policies we now offer, and why my team and I are committed to helping you understand your travel insurance and to travel with the right financial protection and total peace of mind.

 

Wishing you happy travels!

Kate.