You are here: Home - Insurance - News - Understanding -

Travel insurance costs jump by as much as 2,000% for people with mental health problems

0
Written by:
22/08/2018
Almost half of people with mental health problems do not disclose their illness to their travel insurer as premiums shoot up by as much as 2,000% if they do, new research reveals.

Through a mystery shopping exercise, The Money and Mental Health Policy Institute found that several insurers hiked premiums by over 400% for people who disclosed mental health problems that have been stable and effectively managed for a very long time, with some insurers still declining to offer cover.

But premiums soared by between 500% and 2,000% for those who disclosed more severe mental health problems, with most insurers either declining to offer cover at all or only offering cover that excluded mental health.

The charity has asked the Financial Conduct Authority (FCA) to formally review whether travel insurance pricing for this group complies with the Equality Act 2010.

A poll of 2,000 people, carried about by The Money and Mental Health Policy Institute, found that of those who had tried to buy travel insurance in the last five years, 45% of people with mental health problems never disclose their illness to their travel insurer, potentially invalidating any insurance they might take out. This is compared with 6% of people with physical health problems.

The research found that one in three people with mental health problems have travelled with no insurance to cover their mental health, either because they didn’t take out insurance as it was too expensive (13%) or because their mental health was excluded from the cover they could get (21%).

The charity’s director, Helen Undy, said: “Half of us will experience a mental health problem at some point in our lives, which could have a long-term impact on our access to insurance. If the mainstream travel insurance market doesn’t work for half of customers, then it’s really not working at all.”

In June, the FCA said it was working on plans to improve signposting to specialist insurers for people with pre-existing medical conditions. However, Undy said this only “addresses part of the problem”.

She added: “The way insurance companies calculate risk, and set their prices, is determined behind closed doors. Only the regulator has the data needed to check if it’s truly fair. Given the high prices that many people with mental health problems face, and the harm they experience as a result, it’s time the regulator took a closer look.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Autumn Statement: Everything you need to know at a glance

Yesterday Chancellor Jeremy Hunt made his first fiscal statement in the role, outlining a range of tax measure...

End of Help to Buy: 10 alternatives for first-time buyers

The deadline for Help to Buy Equity Loan applications passed on 31 October. If you’re a first-time buyer who...

Moving to an energy prepayment meter: Everything you need to know

As households struggle with the soaring cost of energy, tens of thousands of billpayers are expected to move o...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week