Top 5 reasons why travel insurance claims are rejected, according to insurance providers

In an ideal trip overseas, no flights are delayed, no luggage is lost, and no one falls sick. For the most part, the majority of our holidays do play out like this-nothing but safe and happy travels, and nothing that needs to be claimed from the travel insurance we purchased and forgot all about.

Unfortunately, at some point, luck runs out. Perhaps it'll be someone's luggage that got left behind at an ill-fated stopover, or perhaps an unlucky traveller gets struck with Covid-19 overseas. Either way, it's at that point that we all scramble to dig up the coverage details of our travel insurance policies in order to make a travel insurance claim. And that's just the beginning of our worries.

There are many reasons why travel insurance claims can get rejected, be it for trip disruptions, medical expenses, or loss of personal items. After these things happen, the last thing any of us want is for our travel insurance providers to deal us another blow and reject our claims.

To avoid this, we asked the insurance providers Bubblegum and AIG for common reasons travel insurance claims get rejected. Listen up folks, here are five things not to do when claiming travel insurance.

Reason #1: Missing or incomplete documents

A lack of the necessary documentation to support a claim is a huge reason claims get rejected, be it a claim for medical expenses, trip curtailment/cancellation, personal baggage or document loss, travel delays or baggage delays.

Coverage for such things seems straightforward enough-for example, Bubblegum's travel insurance policy pays out a flat $100 for every six hours of travel delay, capped at $400. That's the easy part to understand. You'd be surprised by the number of claims submitted that don't include documentation from the airline regarding the delay. You can't blame the insurer in this case-how are they supposed to verify that you really were delayed otherwise?

Reason #2: Incomplete or incorrect documentation

So you've remembered to submit your documents. All good, right? Not if you don't submit them in full, or don't submit the correct ones.

Aside from being missing, supporting documents may also be incomplete or incorrect. For example, according to travel insurer AIG, one of the most common reasons claims get rejected is that the final invoices for certain expenses are not provided.

Instead, the invoice provided is the interim version and not the final document. Like how order chits in restaurants cannot serve as receipts to prove payment was made, such interim invoices cannot serve as official invoices for your travel insurance claims. 

Reason #3: Declaring the wrong travel dates on your travel policy

This one's really on you. According to AIG, one common mistake people make is failing to update the travel insurance they purchased when they change their travel dates. Your travel insurance policy covers you for strictly only the trip dates you declared, barring things like follow-up medical treatment back in Singapore for treatment that began overseas.

There is another related declaration that is necessary for travel claims, but that people often overlook-reporting to the airline when you discover that your luggage has been damaged. This can provide essential documentation when it comes to claiming for damaged luggage. 

Reason #4: Claiming for baggage damage by the airline

Speaking of claiming for luggage damages, this one's kinda tricky. Personal baggage coverage differs between insurers.

Under Bubblegum's travel insurance policy, aspects like baggage damage by the airline isn't covered-the airline typically already covers that themselves. Instead, Bubblegum will protect you against baggage damage or loss in the event of theft or robbery, or attempt of either of these. In this case, you need to submit two documents in order to successfully make a claim:

• A police report to prove the theft incident
• A receipt that gives the insurer the value of your belongings

Under AIG's travel insurance, it is possible to claim for baggage that is permanently damaged during a delay. However, you should also be aware of the extent the insurer will cover.

According to the AIG travel insurance policy wording, they will not cover you for "damage due to scratching or denting unless the damage has rendered the item no longer fit for the original purpose for which it was designed.

Claims will not be paid where the damage is limited to impacting the aesthetic appeal of the item." So if your shiny new luggage bag got a little busted up during transit but is otherwise working as it should, sorry mate. Most travel insurers probably won't cover superficial damage that doesn't impair functionality.

Reason #5: Claiming for things outside of your travel policy 

Generally speaking, it all comes down to claiming only what you can claim for, as per your travel insurance policy. 

For example, when it comes to travel delays, it's unlikely that your travel policy will cover secondary issues like a taxi ride home after a travel delay or missing your flight due to being stuck in traffic. Or, when it comes to trip curtailment or cancellation, claims tend to get rejected if the at-fault party is not the airline.

Examples include missing your flight because you forgot to apply for your visa, or booking a flight after an impending typhoon in the area was already made public knowledge. 

And for overseas medical expenses, these costs should have been incurred while you were still overseas. Should you need to make a claim for follow-up treatment in Singapore, there needs to also be some proof that you began your medical treatment while on the trip itself. 

When it comes to medical expenses, you also need to be aware of the dates covered. According to AIG, a common reason travel insurance claims for medical treatment are rejected is that these treatments are administered more than 30 days from the date of your arrival.

How do I make sure my claims are accepted?

The best piece of advice we can give you is to know your travel insurance policy. Reading and understanding your policy documents isn't going to be easy, but they spell out clearly in black and white what's covered and what isn't.

That being said, who has the time and patience to go through a 50-page document in size 10 font? Here are some general tips and pointers to put you in a good position to make travel insurance claims:

• Make sure your travel insurance policies are accurate and up-to-date. This means that if you amend your travel dates, don't just update your father, mother and friends. Update your insurer!
• Always remember to submit your original medical bill and receipts-not the interim invoices.
• Check your luggage for any visible damage and report any to the airline before exiting.
• Apply for your visa and any other necessary travel documents ahead of time. Your forgetfulness may cost you your trip, and your insurer won't cover you for it.
• Check the news for strikes or natural disasters in your destination country before you book your tickets. If such phenomena are already public knowledge, flight cancellations due to them aren't going to be covered. 
• When in doubt, contact the insurer or your agent to find out what coverage you have for your trip. For example, not all travel insurance policies come with extreme sports coverage.

Which is the best travel insurance that will give me the most coverage for my claims?

At the end of the day, the best travel insurance for you is the one that best suits your travel needs and itinerary. Remember, it's important to not make assumptions about the limits of your travel insurance coverage. Having an idea of the most common scenarios, and knowing which plans will provide the coverage you need is the best way to travel with peace of mind. 

For example, if you know you're going to be doing extreme sports and outdoor adventures, buy travel insurance that already covers these, or add riders that cover them on top of the usual coverage.

FWD travel insurance is a good option that covers bungee jumping, hot air balloon rides, scuba diving, skydiving, and snow/ice sports. Yup, even their lowest tier policy, FWD Premium, covers all of these activities.

For a flexible insurance policy with optional riders that you can customise to your needs, STARR travel insurance is a good option you can consider. You have the option of adding riders for golfing, cruises, scuba diving, and snow sports.

ALSO READ: Best travel insurance for extreme sports and outdoor adventure coverage (2023)

This article was first published in MoneySmart.