Medical claims surge as Japan travel booms and Aussie dollar dips

Australian travellers heading to Japan are being urged to reassess their insurance cover, as new data shows a sharp rise in medical claims to the popular destination – coinciding with a drop in the Australian dollar and growing concerns over the cost of overseas healthcare.

According to 1Cover Travel Insurance, medical claims for Japan-bound travellers have spiked by 46% in the past year, with winter sports injuries a leading contributor. The insurer reports that nearly one in four of these claims are related to winter sports accidents – including sprains, fractures, and emergency evacuations – many of which can cost tens of thousands of dollars.

“Japan has seen a surge in snow-sport-related injuries, which are often complex and expensive,” said Natalie Ball, Chief Operating Officer at 1Cover. “One claim alone for a severe pneumonia case on a cruise ended up at AU$267,000 – a stark reminder of how costly overseas medical care can be.”

The warnings come as Japanese authorities consider introducing a mandatory health insurance requirement for tourists, in response to growing unpaid medical bills and pressure on the local health system.

Australia’s love affair with Japan shows no sign of waning, with almost a million Aussies visiting last year – a 50% year-on-year increase, according to the Japan National Tourism Organization. Japan is now the third most popular destination for Australians, based on recent Australian Bureau of Statistics data.

But with the Australian dollar falling below 90 yen for the first time since 2023, 1Cover says travellers may be underestimating how quickly costs can escalate. “A weaker dollar means medical expenses are significantly more expensive for Australians,” Ball said. “Travel insurance is a small investment for substantial protection.”

Despite currency pressures, demand for Japan travel insurance remains strong, though Ball warned that cost-conscious travellers may be tempted to skimp on coverage. “Skipping insurance to save money is a gamble with high stakes. Whether it’s illness, lost luggage or natural disasters, Japan isn’t immune to travel disruptions – and neither are you.”

Top claims for Japan include medical expenses, lost luggage, additional travel and accommodation costs, and trip cancellations.

The ITIJ team recently discussed adapting to medical inflation and the growing role of AI with Beverly Cook, Managing Director of Expacare.