Mental health coverage of travellers under scrutiny

Mental health coverage of travellers under scrutiny

The blanket exclusion that some travel insurance providers have in their policies surrounding claims for mental health conditions is coming under pressure in an Australian court, after one traveller decided to take on the industry’s stance

In what could turn out to be a landmark legal case for the Australian travel insurance sector, Ella Ingram (21) has launched a case in the Victorian Civil and Administrative Tribunal against QBE, alleging that the company’s denial of her claim for cancellation of a trip due to her depression was discrimination. Clare Harris, Ms Ingram’s lawyer, argues that the exclusion is unlawful under the Victorian Equal Opportunity Act.

The story begins in 2011, when Ms Ingram took out travel insurance with QBE ahead of a school trip to the US. Prior to the trip beginning, Ms Ingram was diagnosed with depression and had to pull out of the trip, and claimed the cost ($4,293) on her insurance. However, the company refused to reimburse her on the basis that she had a mental illness.

QBE’s barrister, Andrew Naylor, argued that if the company had indeed discriminated against the plaintiff, which the company denies, that it did so in line with exemptions as detailed for insurers in the Equal Opportunity Act, wherein it states that discrimination is legal if it is based on actuarial statistical data on which it is reasonable for an insurance company to rely.  The issue at hand, he argued, is the substance of said data, and whether it is reasonable for an insurer to impose blanket exceptions on travellers suffering from mental health conditions. In his argument, he said that 45 per cent of Australians would have some kind of mental disorder at some point in their lives, and that for people aged 15 to 25, the likelihood of suffering a mental problem is higher – these statistics, he said, ‘will inform the question of whether it was reasonable to refuse indemnity’. QBE also argued that it would suffer ‘unjustifiable hardship’ under the Commonwealth Disability Discrimination Act if it were to provide mental health coverage in its travel insurance policies.

Choice, an Australian consumer advocate organisation, recently examined travel insurance policies available in the local marketplace, and found that just two will cover a traveller’s mental health condition. Tom Godfrey, head of media at Choice, pointed out: “With around half of the Australian population experiencing a mental health issue at some point in their lives, you would think the insurance industry would be able to price the risks appropriately to look after their customers.” He added: “Our look at the fine print from two of the biggest insurers – BUPA and CGU – found they may cover you, however, they won’t pay claims for disinclination to travel due to mental health conditions including ‘nervousness, anxiety, depression, or stress-related disorders’.”

Beyond Blue, a company in Australia that assists people with legal advice with the help of the Public Interest Advocacy Centre, has already made calls for the insurance industry to improve the way in which it handles applications and claims from those who have suffered, or are suffering, from a mental health condition. Georgie Harman, CEO of the organisation, said it has collected ‘many case studies’ of situations where people had been denied cover or had broad exclusions applied to their insurance policies. She told a local news channel: “They have filled in their application for travel insurance, and they may have gone to see a marriage counsellor 10 years ago. They don’t even have a diagnosis of a mental health condition, and their insurance application is denied. There is just no logic to that.”

Dr June Smith of the Financial Ombudsman Service of Australia said in response to the issue being raised that the organisation would ‘expect that very few applicants would be turned down just on the basis of a history of a mental health condition’, although she did acknowledge that there are situations in which insurance companies may decide they are unable to offer cover. She added: “They are not able to discriminate against someone on the basis of their mental health condition.”

UK focus

Elsewhere in the world, travellers can find decent coverage for their medical needs, including mental health conditions. In the UK, for example, the Foreign and Commonwealth Office recently ran a campaign to heighten awareness of the problems experienced by travellers suffering from such conditions, with an emphasis on the importance of getting appropriate insurance for their trip. The campaign was launched in response to the rising number of travellers calling for consular assistance after a mental health problem overseas.

ITIJ has spoken to a number of travel insurance and assistance providers in the UK and beyond, many of whom confirmed that the number of travellers and international students suffering from mental health problems while overseas is on the increase, and while full coverage is not always available, the vast majority of providers are helping these travellers because not to do so  would be morally reprehensible.