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The global and domestic spread of COVID-19 has forced Canadians
to reassess their upcoming travel plans – and insurers to
assess their travel insurance claims. Weeks ago, airlines started
canceling flights, businesses started to limit business travel,
cities entered into states of emergency and the federal and
provincial governments started closing borders to all non-essential
travel. Many organizations offer travel insurance that will assist
Canadian travelers mitigate their travel-related financial losses
related to COVID-19. Here are three steps to help insurers assess
travel insurance claims caused by COVID-19.
1. Identify the coverage source.
Canadians typically buy travel insurance through one of these
Direct. These include insurance brokers or
brick-and-mortar travel agents that sell policies customized to the
Riders. These include policies that add to
basic insurance policies such as coverage afforded through an
employer’s group insurance provider.
Add-ons. This includes travel protection from
an airline booking site or travel credit card perks and
2. Understand the coverage purchased.
Understanding what a travel insurance policy covers requires a
careful reading of the policy wording. Consult the policy to
determine what coverage was purchased. Travel insurance
policies can be comprehensive or targeted to a particular type of
Comprehensive policies. Known by many names
(such as trip cancellation, vacation and comprehensive trip
insurance), comprehensive travel insurance provides coverage for
multiple events in one insurance package, including cancellation,
interruption, evacuation, lost/stolen luggage and interruption
coverage. Larger organizations will likely have
comprehensive policies that may cover employee travel necessitated
by COVID-19, including delays and alternative travel
Targeted policies. Targeted travel insurance
includes limited coverage for travel, medical (which
provides emergency coverage), lost/stolen luggage, prescription
drugs or evacuation (to take the traveler to the nearest hospital
or repatriate them). These policies are specific and narrow in
scope, and are typically add-ons to other financial and travel
3. Evaluate the exclusions.
Depending on the wording of the policy, unless explicitly
provided, travel insurance does not cover voluntary cancellations
or changes made by the traveler. Travel insurance also might not
cover foreseeable events. Since the World Health Organization
declared the novel COVID-19 as a global pandemic, coverage may be
limited through policy wording dealing with pre-existing risk.
Further, policies sometimes have exclusions that apply to pandemics
(as opposed to localized disease outbreaks) and travel subsequent
to government advisories.
We recommend reviewing policy wordings, which may contain
exclusions for medical expenses, pre-existing conditions or
personal injury relating to contagion. Review claims to see if the
cancelation of a trip is because of risks associated with COVID-19,
and assess the facts accordingly. As the wider outbreak was
known by February 2020, consider whether such an event was
foreseeable at the time the traveler purchased the policy.
If you are looking for advice or support with insurance issues
arising from COVID-19, McInnes Cooper can assist you with
understanding and responding to these risks. We provide solutions
to corporations, insurers, underwriters, and agents within the
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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