Why Travel Insurance Didn’t Help These Bike Crash Victims in Thailand

motorcycle crash and stortzes

Left: Matt & Ashley Stortz (courtesy of their GoFundMe page); right: crashed motorcycle (Creative Commons)

Travel insurance is a must-have for any trip to Southeast Asia – but even so, no travel insurance policy can cover everything. While most respectable policies will cover trip losses due to injuries or flight delays, coverage can only go so far.

Take the case of Matt and Ashley Stortz, a Canadian couple injured in a motorcycle crash in Koh Lanta, Thailand. Swerving to avoid both an oncoming car in the other lane and a gash in the road on theirs, the Stortzes “hit the ground pretty hard” , incurring no broken bones but plenty of gashes and abrasions (in Matt’s case, all the way down to the bone).

As if that wasn’t trouble enough, the Stortzes found that their travel insurance would not cover Matt’s treatment, as “he did not have a motorcycle license, something that they were not aware they needed,” their GoFundMe page explains.

Luckily, crowdfunding has raised over $15,000 to cover the shortfall. Not everybody might be so fortunate, though – lack of a license is only one of the surprising exclusions encountered by travelers to Southeast Asia.

This is not to say that all travel insurance providers will refuse to cover, say, a motorcycle accident – asking your provider is the only sure way to find out what your coverage excludes.

Pitfall #1: Lacking proper licenses

“Most people are not aware that renting these bikes without a proper motorcycle license means your insurance provider will not cover you if you get in an accident,” explains the Stortzes’ GoFundMe page. This is not in any way a slam on the Stortzes, as scooter rental companies in Thailand often don’t check for valid licenses before renting away their rides.

“If the company itself just rents it to you, you’re like, ‘OK, they’ve got my passport, they’ve got my license,’ what you don’t realize is that it’s actually illegal,” explained the Stortzes’ friend Jen Johnson.

According to the Stortzes’ insurer World Nomads, “It‘s pretty straightforward; no valid license in the country where the accident happened, means you‘re riding illegally and you‘re not covered.” Insurance will not cover the consequences of illegal activity, like not wearing a helmet or getting into fights. (Ashley, luckily, was covered by her insurance because she was a passenger, not the one driving.)

“Many, many claims are rejected simply because the rider didn‘t have a license (and in the case of Australia, NZ, UK and Ireland policyholders, no valid motorcycle license at home too),” the insurer explains. “Make sure you check the whole policy wording carefully to understand how this works with the policy you buy.”

Soldier guards mosque at Lanao Lake, Philippines

Soldier guards mosque at Lanao Lake, Philippines

Pitfall #2: Traveling to no-go zones

What’s worse than getting shot at while bird-watching? Finding out later that your insurance provider won’t pay up due to a U.S. State Department travel warning about your present location!

“Depending on the particular company, coverage may not be available if there is a State Department warning in place,” explains Linda Kundell, spokesperson for the US Travel Insurance Association (USTIA), a national association of travel insurance providers.

This is not a hard-and-fast rule. “That would depend on the particular company as to whether or not a person were covered,” says Kundell, adding that “there are also assistance companies that have special policies that may help people in more troubled areas.”

Still, the likelihood of voiding your coverage is large enough to require doing homework beforehand. “If someone is planning to go to a country with a State Department Warning, they should check with the travel insurance company about coverage,” explains Kundell.

Partying at Sinulog Festival, Philippines

Partying at Sinulog Festival, Philippines

Pitfall #3: Being a bad drunk

Drinking is one of the most popular tourist activities within Southeast Asia (after all, it has some of the finest beers on Earth), but its consequences may not be covered by your travel insurance provider.

“Most policies have general exclusions relating somehow to losses due to abuse of alcohol, intoxication, drugs, etc.,” explains Kundell. “Most policies also have exclusions relating to treatment for alcohol abuse or other addiction – basically, the customer can’t claim medical expenses incurred on the trip related to such treatment.”

Which is not to say that insurance providers will automatically reject any claim where some moderate tippling occurred. “Most US policies do not exclude losses if there is mere consumption of alcohol,” says Kundell.

Illegal drugs are another kettle of fish – read about harsh punishments for drug use in Southeast Asia.

Luggage at airport.

Luggage at airport. Image courtesy of Mike Liu/Creative Commons

Pitfall #4: Theft of certain items

Comprehensive travel insurance policies often include a baggage benefit that covers you for lost or stolen baggage – but not all kinds of lost or stolen items.

“There are usually exclusions regarding particular items, such as money [and] jewelry,” explains Kundell.

Even covered items might not be considered by your provider if you fail to report the loss, Kundell warns: “there are usually requirements that the loss [or] theft be reported to the police or other authorities.”

To waterproof any claims for loss, look through your travel insurance policy thoroughly to find out the full extent of your policy’s coverage over your valuables – some kinds of loss may be covered only partially by the policy.

“There may be per-item limits in some policies, or limits by class – for example, electronics might be covered up to a certain dollar amount,” explains Kundell.

You might find out that your other insurance policies may cover what your travel insurance cannot. “Many travel insurance policies are excess over other policies, such as homeowner’s coverage,” explains Kundell. “Homeowner’s or renter’s insurance generally covers personal items worldwide, subject to the deductible.”

Digital display at Changi Airport, Singapore

Digital display at Changi Airport, Singapore

Avoid those pitfalls – Follow these tips

Before purchasing a travel insurance policy, read it carefully from top to bottom – and be mindful of its exclusions (you can use the pitfalls listed above as a guide).

Pre-existing medical conditions, dangerous activities (like extreme sports) and staying in hostels are other common reasons providers cite to refuse coverage.

Insurance providers cover “acts of God” in different ways; some policies provide excellent coverage for losses due to natural disasters, some simply don’t. Watch what “acts of God” your policy covers – this may serve you in good stead later, particularly if traveling during Southeast Asia’s typhoon season.

Don’t travel with anything you can’t replace immediately; keep valuable items (like laptops) with you at all times. No insurance policy can ever compensate for the loss for anything of major sentimental value, and most policies limit coverage of stolen goods up to a certain dollar amount.

Before purchasing a policy, look at the company offering the coverage. Beyond visiting their website, look them up via third-person agencies – you can check their credentials on A.M. Best (www.ambest.com), an international insurance rating agency; or check for membership in the US Travel Insurance Association (www.ustia.org), where membership depends on following the association’s strict legal and ethical standards.

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