Insurers Brace for Impact
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ESSENTIAL READING FOR TRAVEL INSURANCE INDUSTRY PROFESSIONALS WWW.ITIJ.CO.UK JULY 2011 • ISSUE 126 Insurers brace for impact The latest research from Finaccord, Travel Metrics European survey, travel insurance claims resulting in Europe, gives details of how last year’s Icelandic directly from the chaos caused by the Icelandic eruption affected the rate of travel insurance eruptions of April 2010 accounted for 5.4 per cent claims in 2010. Mandy Aitchison delves into the of all reported claims. Whilst this may, at fi rst glance, report for more information appear relatively insignifi cant, it should be borne in mind that the air-traffi c disruption caused by the As Finaccord’s report was released, the Grimsvotn volcanic ash lasted only a few weeks, whereas the volcano, also in Iceland, was spewing ash into survey as a whole was based on respondents’ most the air, again affecting the fl ight plans of thousands recent trip undertaken during 2009 and 2010.” of people. Soon afterwards, the eruption of the In overall terms, the most common reasons for Chilean volcano began to affect fl ights into and out submitting a travel insurance claim were lost, of Chile and Argentina, with knock-on effects felt stolen, or damaged baggage or belongings, medical in Australia, New Zealand and Africa. Finaccord’s expenses incurred while travelling, and accidents survey has provided detailed analysis of the travel incurred while travelling. None of these core areas habits, insurance uptake and claims behaviour of of claims activity were specifi cally associated with 6,000 consumers in France, Germany, Italy, the volcanic ash. However, within the universe of Netherlands, Spain and the UK. A unique feature claims relating to fl ight or trip delay and cancellation, of the research, according to the company, was to postponement or interruption, the volcanic ash allow claimants to indicate the primary reason why cloud was seen to have had a substantial impact, they had made a claim against their travel insurance and accounted for 31.1 per cent of all such claims. policy, and given the time period covered by the The detailed breakdown of this particular segment of survey, these included various options that were claims activity is shown in the chart on p.5. specifi c to volcanic ash. Tottman said: “The fact that last year’s volcanic The survey showed some interesting results, with eruptions had a particularly strong effect on insurance Simon Tottman, a consultant at the research fi rm, claims related to trip delay and cancellation means commenting: “Across all respondents covered by the that the current situation (the continued on p.5 Ash Cloud 3: South America hit NZ counts potential Just as the ash from the Icelandic Grimsvotn cost of World Cup volcano was settling, the Chilean Puyehue- Cordon-Caulle range of volcanoes got in on the Many of the thousands of foreign fans heading to act, sending ash and debris thousands of metres New Zealand (NZ) for this year’s Rugby World into the air. The resulting ash cloud prompted the Cup will be from Britain and Australia, and as closure of airports across South America, including both of these countries have reciprocal health the suspension of fl ights to and from Buenos Aires agreements in place with NZ, there are concerns and disruptions to fl ights in Santiago. Winds blew among health authorities that the Kiwi taxpayer the ash further afi eld, with subsequent closure of will foot the bill for the medical needs of foreign airports in Australia, New Zealand and Tasmania, fans. Sarah Watson reports before the wind changed direction and affected fl ights in Argentina, Brazil, Chile, Colombia, The reciprocal health agreements take precedence Paraguay and Uruguay. over travel insurance policy arrangements, meaning Airlines including Virgin, Qantas, Jetstar and Tiger that hospitals – public and private – are not able Airways all experienced fl ight cancellation or delays. to recover the costs incurred from treating foreign Virgin Australia operated a reduced service with patients from their insurers. Visitors from countries planes that fl ew below the continued on p.4 that do not have agreements continued on p.4 IN THIS ISSUE ITIJ CONTRIBUTORS REGULARS David Ing is a freelance journalist covering mainly travel and tourism issues News continued 4 in Spain. He writes on air transport for a leading international news agency, as well as Editorial blog 4 contributing special features to Newsweek Company brief 8 and writing in-fl ight magazine articles and Insurance matters 9 guidebooks. Health matters 12 David Kernek has, for the past four Travel matters 14 years, been in a full-time post editing two glossy travel magazines - Holiday Villas and IPMI news 16 Holiday Cottages. He has since converted this Cross-border care 18 into a freelance role having become self- employed and now has regular commissions in Air ambulance news 20 consumer, trade and B2B publishing. Service directory 39 Mick Shippen is a freelance writer and Grapevine 46 has been based in Thailand for over a decade. On the move 47 A fl uent Thai speaker, he currently lives in Bangkok but also spent six years in Chiang Mai. Mick is a regular contributor to regional and international publications. He is also the author of The Ceramics of Southeast Asia, FEATURES published by the University of Hawaii Press. Feature: Chance of a lifetime 24 With New Zealand hosting the upcoming Rugby World Cup, a local international assistance fi rm considers how best to cope with the infl ux of tourists Feature: ITIC Hong Kong Review 26 A round-up of the sessions that were held in Hong Kong in June Assistance & Healthcare World Markets: Brazil 34 Extreme wealth and extreme poverty in close proximity has led to signifi cant gaps in care levels; ITIJ points the way for tourists in need Front page image courtesy of Associated Press ITIJ TEAM Editor-in-chief: Ian Cameron ITIJ Published on behalf of: Voyageur Publishing & Events Ltd, Editor: Sarah Watson Voyageur Buildings, 43 Colston St, Bristol BS1 5AX, UK Voyageur Buildings, 43 Colston Street, Bristol BS1 5AX, UK Title editor: Mandy Aitchison Telephone: +44 (0)117 922 6600 The information contained in this publication has been published in good faith and Copy editor: James Paul Wallis every effort has been made to ensure its accuracy. Neither the publisher nor Voyageur editorial dept: Ext. 3 Ltd can accept any responsibility for any error or misinterpretation. All liability for loss, Conference manager: Denise Clements disappointment, negligence or other damage caused by reliance on the information advertising dept: Ext. 1 contained in this publication, or in the event of bankruptcy or liquidation or cessation Production: Kirsty Diclaudio of the trade of any company, individual or fi rm mentioned is hereby excluded. subscriptions dept: Ext. 209 Helen Watts Subscriptions: Kate Knowles Printed by Pensord Press, South Wales, United Kingdom fax: +44 (0)117 929 2023 Copyright © Voyageur Publishing 2011. Materials in this publication may not be reproduced in any Advertising sales: David Fitzpatrick email: [email protected] form without permission James Miller web: www.itij.co.uk INTERNATIONAL TRAVEL INSURANCE JOURNAL ISSN 1743-1522 Finance: Elspeth Reid Would you like to make a comment? Louise Goddard Please get in touch with Ian Cameron, Design: V Creative Design WOULD YOU LIKE TO SUBSCRIBE? Editor-in-Chief of ITIJ on +44 (0)117 922 6600 ext205 vcreativedesign.co.uk VISIT www.itij.co.uk International Travel Insurance Journal ■ www.itij.co.uk 4 NEWS Ash Cloud 3: NZ counts potential cost South America hit of World Cup continued from p.1 continued from p.1 in place will be billed for their care, with district health it will be owed. Rosser Thornley, group accounting level of the ash cloud. The impact of ash on aircraft boards believing that most costs could be recovered manager at the board, said: “We’ve certainly got it could be significant, although some European either through insurance or debt repayments. on the radar. We expect that the volume [of bills] will So the ash cloud strikes again, and this time in airlines claimed recently that the effect was not as A briefing document released by the Hutt Valley District be higher than usual, but if we put a bit more [debt South America, affecting flights as far away as bad as the experts were csaying, complicating the Health Board has warned of the potential impact that collecting] resources in, then we’d hope to recover Australia and New Zealand ... it’s becoming a situation. Siva Govindasamy, editor of Flight Global could be felt as a result of the estimated influx of 80,000 more costs.” According to governmental figures, around bit like being stuck on an aircraft with a bunch magazine, said at the time of the disruption: “The foreign tourists, some of whom will almost inevitably 80 per cent of the debt owed by foreigners to the NZ of flatulent people. You don’t know when or problem is that there is a lot of speculation about need some kind of medical assistance during their visit. health system was paid in 2010, but this takes in the from which direction the nasty smell is going the actual impact of the ash. This is a big worry for The document states: “It is likely that many of these entire country, and some district health boards will have to come ... but come it will. So much for one- the airlines, and as a result they are cancelling flights visitors will reside in countries which have reciprocal lower payback rates than others, explained Thornley, off eruptions eh? as a precautionary measure.” health agreements with NZ.