Changing consumer perceptions of travel insurers

Businessmen covering mouth, eyes and ears
Accentuate the positive

How can travel insurers change the public perception – often encouraged by consumer media – that they will use any excuse to deny a claim? Robin Gauldie finds that some insurers are reaching for imaginative initiatives to win hearts and minds

Megaphone in front of a chalkboard

Don’t assume that the journalist understands that it’s not the broker who sold the policy who makes the decision whether to pay – or not to pay – a claim

There’s a cynical old journalist’s adage: if it bleeds, it leads. To put it another way, good news is no news. ‘Aircraft lands safely’ ceased to be a headline almost a century ago. ‘Aircraft crashes’, on the other hand, will always top the news agenda – in fact, the rarer such accidents become, the more newsworthy they are. ‘Travel insurer refuses to pay out’ is always a story. ‘Travel insurer settles 90 per cent of claims’, not so much.

This is a well-known conundrum for travel insurers: how to persuade clients to read and understand terms and conditions that range from common to not-so-common exclusions. And insurers are reaching for imaginative initiatives.

“Customer education is key, as one of the biggest mistakes we see customers make is buying travel insurance and assuming they are covered if anything goes wrong, without actually reading the details of their policy. However, this often leads to claims for losses that are not covered. This lack of understanding is one of the biggest reasons travel insurance claims are denied,” said Kasara Morison, Public Relations Manager at Squaremouth, a US travel insurer.

“We secretly launched the Pays to Read contest to emphasise the importance of reading policy documents and offered a $10,000 reward to the first individual to read their policy from start to finish. We added text to Tin Leg’s policy documentation that offered a reward to anyone still reading.” The winner, Donelan Andrews, a teacher from Georgia, contacted Squaremouth just 23 hours after the contest launched.

Hostile environment
To travel and health insurers, the mainstream media can often seem relentlessly negative, even hostile. Consumer outlets focus on rejected claims or delayed settlement, while rarely – if ever – reporting happy outcomes and satisfied customers.

The industry does a lot of proactive media around travel insurance, especially around peak periods of travel, to help promote the message that travel insurance will pay

A case in point comes in the form of a story published by British newspaper The Guardian in December 2019, which it ran under the headline ‘Ruined Holiday – ‘The insurer won’t pay our claim because our teenager had acne’’. And here’s another: in August, the Association of British Travel Agents (ABTA) released a report that suggested that one in five Britons travelled without travel insurance. The report’s commendable aim was to encourage Brits to buy adequate travel cover. But here’s how a headline written by British newspaper the Daily Mirror spun the story to make travel insurers the bad guys: ‘Travel insurance deals leaving thousands of people at risk’. Another recent and negative story from an advice website that is part of the UK’s influential Daily Mail media group focused on a British family who, the story claimed, faced ‘financial ruin’ after an insurer refused a claim after one family member incurred huge US hospital costs after a serious snowmobile accident. The family, the report claimed, cited a technicality in policy wording as grounds for refusal. In actual fact, the policy didn’t cover snowmobiling. 

Stories like these reinforce negative consumer attitudes to travel insurers – but how can the travel insurance sector rebut them?

“Improving the reputation of travel insurance providers in the mainstream national media is a challenging brief,” acknowledged Sean Feast, Director of Gravity Global, public relations agency for British insurer AllClear Travel Insurance. “Insurance companies are not the most loved of our financial institutions, and insurance is, of course, a grudge purchase.” It is easier to create negative stories than it is to publish positive ones. It’s not helped by the fact that every journalist (and I include myself in this as a former journalist from the 1980s) will invariably have personal experience – and therefore a personal opinion – on your business. And if they don’t, then they inevitably have a friend or family member who does.

“The media will more usually be excited by the handful of occasions that a claim is not paid, seemingly because the insurer has ‘wriggled out’, rather than those where the insurer has actually come to the rescue, often when [the insurer] had every right to dismiss or part-settle a claim.”

Stay realistic and keep it simple
Rule number one, Feast says, is for insurers to stay realistic. “Get over the fact that life is unfair; don’t let it stop you trying to promote good news.”

Rule number two is to recognise that not every journalist or reader understands how your industry works, he notes: “Some correspondents will have greater knowledge than others, but never assume that a writer has the same knowledge as you. Strip out the jargon; simplify the message. Don’t assume that the journalist understands that it’s not the broker who sold the policy who makes the decision whether to pay – or not to pay – a claim. It is also not the company at the end of the phone line in the event of an emergency abroad. Sometimes a broker isn’t even aware there has been a problem until a complaint reaches the media, and that can require some smart footwork. Be on your toes. Do what you can to help your customers understand how the industry works. Indeed, once you’ve told them, tell them again, and don’t stop telling them.”

Case study

Keep it positive
Sean Feast insists that there are opportunities for travel insurers to peddle a positive image. “There are plenty of good stories out there, and we should be telling them,” he said. “It is important that people with a pre-existing medical condition do not travel overseas uninsured or with insufficient insurance cover. It is important that the message of ‘declare everything’ is properly heard. And it is important that customers have the confidence to buy from providers who truly understand the difficulties they face.”

Feast notes that case studies are an essential image-building tool, and particularly useful for winning customers over: “Nothing tells your story better than one of your happy customers, especially if they’ve been through a difficult time and you’ve come to the rescue.”

Facts and figures
“Statistics are also important. Every journalist likes a fact,” said Feast. “Switch on the TV tonight or pick up a newspaper and see how many stories start with (or include) a stat. Generating credible statistics, perhaps through a third-party, is incredibly useful. It allows you to comment with authority and – when combined with a case study – to provide a ‘packaged’ story to the press that improves your chance of getting noticed.”

Could the travel insurance sector emulate the media management strategies of the broader travel and tourism industry and other consumer businesses? “Emphasising good news stories and being open and honest with the media is best practice when it comes to communications for any industry, and the Association of British Insurers (ABI) is active in promoting its members’ work,” noted Sean Tipton, a spokesperson for ABTA. “Travel insurance is a sector that gets attention in the media and it is important that any coverage is balanced to ensure holidaymakers are not put off covering themselves.” 

The ABI states that around £350 million is paid out by its members each year to cover medical bills. But that’s not a figure that is widely flagged up in the mainstream media. “The ABI has created step-by-step guidance on travel insurance, including advice on what you should take into account when buying travel insurance, how to make a claim and what types of insurance are available,” said ABI spokesperson Malcolm Tarling. “The industry does a lot of proactive media around travel insurance, especially around peak periods of travel, to help promote the message that travel insurance will pay.”

Newspapers

Social media is a powerful tool
Daniel Durazo, Director of Marketing and Communications for Allianz Global Assistance USA, agrees that PR, aided by social media, can help travel insurers get a positive message across to clients. “At Allianz, we hear from customers all the time via our social channels and have a dedicated team that answers inquiries to customers and potential customers on public platforms, and we also proactively tell our success stories via PR tools like pitching, press releases and media relations,” he said. “We feel it’s important to proactively tell the stories we’ve received from our customers in order to educate travellers about the value of travel insurance. Over the past few years, we’ve been lucky enough to be the recipient of many positive customer testimonials and we’ve even created some incredibly powerful videos from those stories. Hearing about how we help others not only motivates our team but presents an opportunity to spread the word through very personal, first-hand experiences.” 

As an example, Durazo cited that, in 2019, Allianz customer Steven Lapidus had a medical emergency in Italy where his US$79 policy saved him $70,000. “We shared this story with a local TV station who then interviewed him,” Durazo expounded. “The story was positively received and the station’s affiliate in Richmond (VA), where Allianz Global Assistance is headquartered, then asked for a follow-up story that allowed our assistance director to divulge a little bit of the hard work she and her team do every day, around the clock.”

The story garnered articles headed by straplines like: ‘Thousands of miles, thousands of dollars: Local man’s journey from sickness to health’ and ‘Man who fell ill during overseas trip says Richmond travel insurance company saved his life’. Characterising Allianz as a ‘Richmond travel insurance company’ may be a bit parochial, but the point is that the local angle took the story nationwide.

Travel insurance is a sector that gets attention in the media and it is important that any coverage is balanced to ensure holidaymakers are not put off covering themselves

Terms and conditions apply
“Some people have the perception that insurers try to avoid paying claims, but we also attribute this mindset to that upfront misunderstanding about what coverage is in place,” said Morison at Squaremouth. “We understand most customers don’t actually read contracts or documentation when buying something, but we know the importance of doing so.”

Morison added that her company also offers its Zero Complaint Guarantee: “Our promise that the policy you purchase from our site is from a reputable provider who will handle your claim fairly and honestly.” She explained that all of the providers on the site must agree to comply with this guarantee. “If our customers are unhappy with how their claim was handled, our Zero Complaint team investigates the case and will mediate the claims process on our customer’s behalf. If we are not able to resolve the customer’s complaint to our satisfaction, we remove the provider from our site and stop selling their products. This process has helped us understand the customer experience and to ensure that the claims process is handled correctly.”
Squaremouth, which offers its own travel insurance product, is also working to simplify the claims process, Morison said. “Instead of having the customer navigate the claim paperwork on their own, customers schedule a time to speak with one of our licensed claims adjusters who listen to their issue, pre-fill the paperwork, and email it over to the customer,” she detailed. “They also keep the customer updated via email throughout every step of the process, which helps provide peace-of-mind.”

True stories
In November, Australia’s Fast Cover Travel Insurance launched Travel Insurance Week, an initiative aimed at encouraging Australians to buy travel cover and to highlight the need to make sure that cover is appropriate. Fast Cover’s 2019 Great Australian Travel Survey revealed that less than 30 per cent of travellers read all of their policy’s product disclosure statement, and 56 per cent stated that they read only the sections that interested them.

Fast Cover and its underwriter, Hollard Insurance, used the event as an opportunity to highlight positive outcomes. A dedicated website, Travel Insurance Awareness, focuses on the true stories of clients who sustained life-threatening injuries while on holiday and who required treatment and medical evacuation, which in one case covered by Fast Cover cost $493,000. The company also created a YouTube interview with one such client and made others available for interviews by Australian media.

Initiatives like these benefit not just individual insurers but the entire travel insurance sector. There are a number of companies in various countries who have created similar methods of communicating case studies with the public but perhaps even more companies should consider similar efforts.