Less Cash, Less Cover to Save Sector According to Sqauremouth
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NEWS & APPOINTMENTSINSIDE page 6 Page 32 Page 26 Page 26 ESSENTIAL READING FOR TRAVEL INSURANCE INDUSTRY PROFESSIONALS MARCH 2010 • ISSUE 110 Hikes required Less cash, less cover to save sector According to Sqauremouth. carriers to keep the price of travel insurance A travel insurance provider in the UK has said com, travel insurance in the US premiums down last year, this meant customers paid the industry must raise its rates if it is to survive has become cheaper with fewer a little less but got fewer benefi ts for their money.” the challenges it faces. Charlotte Hodgman has benefi ts as a result of the tough Top of the sales leaderboard on the website was the details operating environment. Mandy Travelex, followed by Travel Insured International Aitchison reports on the and CSA Travel Protection in third place. Travelex Peter Hayman, director of PJ Hayman, has stated that latest industry adaptations has risen to the top spot from coming second in travel insurance rates will have to rise by as much as 2008, thanks to the launch of several cheaper, 20 per cent to mitigate the negative impact of the Sales data compiled by slimmed-down policies throughout the course of the recession and accommodate the losses experienced Squaremouth.com, year. At the same time as prices were dropping for by the sector due to the weakness of the Sterling, a travel insurance customers, from an average of US$199 in 2008 to increasing claims costs and the collapse of a number comparison site, has $187 in 2009, the industry reported that the level of tour operators and airlines. found that travel cover of sales had remained fl at. Although Travel Insured Hayman, who claimed “although the Sterling is was more of a bargain in 2009 International slipped from fi rst to second place in starting to rally against the Euro, a great deal of than it has ever been. Americans terms of sales, the company managed to retain fi rst damage has been done over the past 18 months or sought value during the place in overall premium cost. so,” also stated that the increase of holidaymakers economic downturn by buying While some travel insurers launched new, cheaper travelling outside the Eurozone to get better value cheaper policies that came with products, many others chose to simply tweak their for money had also impacted the travel insurance fewer benefi ts than would have existing policies, eliminating some of the more industry, as destinations such as continued on p.5 been seen in previous years. expensive benefi ts or making previously included Chris Harvey, chief executive benefi ts added extras instead. Harvey commented: offi cer of Squaremouth, said: “The trend toward purchasing policies with fewer “The American traveller is benefi ts suggests Americans vacationed more in the Travel insurers obviously cost-conscious right US – where they would have been covered for most now. There was pressure on medical expenses through domestic health insurance trapped – rather than going abroad.” Sqauremouth itself enjoyed a bumper year in 2009, Possible new US hospital admissions rules with the number of sales doubling compared to 2008. and exploding costs could affect foreign travel insurers. Milan Korcok explains the problem Squaremouth 2009 % travel insurance of market by leaderboard policies sold UnitedHealthcare, one of the largest health insurers in the United States, and benefi ts administrator for Travelex 20.29 many international travel insurers, has taken the Travel Insured fi ght for cost control to a group of leading New York International 19.5 hospitals, threatening to slash their reimbursements if CSA Travel Protection 12 they do not meet stringent new admission notifi cation TravelSafe 8.49 rules that are part of ongoing contract negotiations Travel Guard 8.19 between the parties. The hospitals, which include such Seven Corners 8.14 iconic institutions as Beth Israel Medical Center and St Luke’s-Roosevelt Hospital Center, have in turn dug HCC Medical Insurance Services 6.18 in their heels and asked the courts to prevent United HTH Worldwide 3.39 from implementing what they are calling ‘confi scatory’ iTravelInsured 3.6 payment penalties should they fail to notify United of patient admissions within 24 hours. The hospitals claim Medex Insurance Services Inc. 2.3 United is threatening to cut reimbursements by 50 per other 7.92 cent in such cases. The confl ict, which some continued on p.4 IN THIS ISSUE ITIJ CONTRIBUTORS REGULARS Robert Bailey is a business journalist and writer on the Middle East and Africa with more than 25 years reporting experience of both regions. He has carried out many in-depth News continued 4 assignments in these areas for newspapers and magazines News & Appointments 6 including the International Herald Tribune, Newsweek, Time Editorial comment 8 Magazine, Wall Street Journal, Forbes and for many other Company brief 9 journals. He is also a specialist writer on aviation, tourism, telecommunications as well as security and defence matters. Insurance matters 10 Health matters 14 Robin Gauldie is a freelance journalist specialising in Travel matters 16 travel, aviation and related sectors. A former editor of the Cross-border care 18 pan-European travel industry newspaper TTG Europa, he has Air ambulance news 20 also edited Destination ASEAN (the offi cial publication of the IPMI News 22 Association of South East Asian Nations), ABTA Magazine Service directory 39 (the offi cial publication of the Association of British Travel Agents), and Travel Agent International. He contributes Grapevine 46 to The Times, The Sunday Telegraph, The Scotsman, The Diary dates 46 Sunday Mirror, and to numerous specialist magazines. He is On the move 47 also the author of more than 20 travel guidebooks to a host of destinations – from Dublin to Sri Lanka. FEATURES Milan Korcok is an award-winning freelance health policy and economics writer who covers travel insurance, public Feature: Fever pitch 26 health, and medical education issues in Canada and the US. ITIJ takes a look at what travel insurers and assistance firms He has been writing about health fi nancing and policy issues can expect from the FIFA World Cup in South Africa in these countries since the 1960s, is a frequent contributor to leading North American professional journals and consumer media, and is publisher of the consumer website www.trave- Feature: More Bangkok for your buck 30 linsurancefi le.com. He lives in Fort Lauderdale, Florida. The relaxation of banking regulations in Thailand has resulted in the growth of bancassurance Mick Shippen is a freelance writer and has been based in Thailand for over a decade. A fl uent Thai speaker, he cur- Assistance and Healthcare World Markets: rently lives in Bangkok but also spent six years in Chiang Quality at a price 32 Mai. Mick is a regular contributor to regional and interna- The German health system has plenty to offer a tourist in need tional publications. Profile: Daniel Scognamiglio 38 Partner, Blake Lapthorn LLC ITIJ TEAM Editor-in-chief: Ian Cameron ITIJ Published on behalf of: Voyageur Publishing & Events Ltd, Acting editor: Mandy Aitchison Voyageur Buildings, 43 Colston St, Bristol BS1 5AX, UK Voyageur Buildings, 43 Colston Street, Bristol BS1 5AX, UK Sub-editor: Charlotte Hodgman Copy editor: James Paul Wallis The information contained in this publication has been published in good faith and Staff writer: Vicky McPhie Telephone: +44 (0)117 922 6600 every effort has been made to ensure its accuracy. Neither the publisher nor Voyageur Ltd can accept any responsibility for any error or misinterpretation. All liability for loss, Editor-in-absentia: Sarah Watson editorial dept: Ext. 3 disappointment, negligence or other damage caused by reliance on the information Designers: Eli Butler contained in this publication, or in the event of bankruptcy or liquidation or cessation advertising dept: Ext. 1 of the trade of any company, individual or fi rm mentioned is hereby excluded. Steve Annette James Elliott US correspondent: Milan Korcok fax: +44 (0)117 929 2023 Printed by Pensord Press, South Wales, United Kingdom Conference manager: Denise Clements email: [email protected] Copyright © Voyageur Publishing 2009. Materials in this publication may not be reproduced Production: Helen Watts web: www.itij.co.uk in any form without permission Kirsty Diclaudio design: V Creative Design INTERNATIONAL TRAVEL INSURANCE JOURNAL ISSN 1743-1522 Advertising sales: David Fitzpatrick James Miller Would you like to make a comment? Finance: Elspeth Reid Louise Goddard WOULD YOU LIKE TO SUBSCRIBE? Please get in touch with Ian Cameron, Illustrations: Chris Duggan VISIT www.itij.co.uk Editor-in-Chief of ITIJ, on +44 (0)117 922 6600 International Travel Insurance Journal ■ www.itij.co.uk 4 NEWS Future isn’t bright Travel dispute cover Milan Korcok reports on the latest US healthcare out the spiraling cost curve. causes concern data, which doesn’t make for happy reading for One particularly significant trend shown in the data international travel insurance providers trying to is the drift toward more public and less private InsureandGo has caused some consternation control their costs spending. The report indicates that much of the among travel agents and tour operators by increase is due to accelerated spending by public introducing an added extra to its travel insurance For international travel insurers hoping to keep the payers (8.7-per-cent increase in 2009), while policies that allows the client to sue the agent for lid on premiums for travel to the United States, the private payer spending (including private insurance) a breach of contract. The Travel Dispute cover is news is nothing but bad. Despite all the rhetoric increased by only three per cent. Public payers being sold as a direct sell add-on to the company’s about making healthcare more affordable, the include the federal Medicare program and state normal insurance offering, at a cost of £4 for a single annual report from government analysts shows that funded Medicaid.