Holidaymakers warned against making fraudulent travel insurance claims

A recent report from the Association of British Insurers (ABI) says anyone caught making a fraudulent claim on their travel insurance may face higher insurance costs; problems in obtaining other insurances; more expensive credit, and possible prosecution.

Last year, travel insurers detected 4,300 dishonest travel insurance claims – over 80 every week – worth £5 million.* The ABI said insurers and overseas police forces are becoming more vigilant when investigating claims in an attempt to crack down on cheats.

Nick Starling, the ABI’s director of general insurance and health, says: “Travel insurance is there to cover you if things go wrong, not to pay for the cost of your holiday.

“The vast majority of claimants are honest, but the dishonest few are in for a nasty and expensive shock this summer. Details of fraudulent claims are held on industry databases, which will impact on the cost and availability of other types of insurance, such as motor and household, and affect an individual’s credit rating.”*

Steven Williams, head of travel insurance at, believes dishonest insurance claims could hit people much harder in the long term if they are caught.

“A fraudulent claim will remain on your credit history for five years, possibly more. This means a dishonest claim for a £200 camera for example, could end up costing a huge amount more additional insurance premiums in the future.”*

The ABI said potentially suspicious claims include the last minute loss, where items are reported lost or stolen to the insurer very shortly before returning home, with no time to report the loss to the police; and claims for high value items, such as cameras, jewellery and camcorders, where there is a lack of proof of the loss or theft.

However travel insurance provides invaluable protection for legitimate claims, holidaymakers should not to travel without it. Don’t be put off taking out travel insurance. Insurers are obliged to treat each claim with the utmost good faith, and will give claimants the benefit of the doubt.

If you need to make a claim, follow these steps:

1. Read the small print
Yes it’s long and tedious but it’s important to understand the level of cover and exactly what the policy will pay out for. In particular, look out for the excess amount per item and the maximum individual limits per item; the level of medical protection and any exclusions to the policy. You should also check whether cash is covered and how much, and if loss is covered in addition to theft. If you plan to take part in adventure sports such as bungee jumping, you may require additional cover.

2. Keep a record
Receipts for possessions such as iPods, cameras and phones are the best proof of ownership if the items get lost or stolen, but many us of may not hang on to them for long. “So make a note of what you take and try to track proof of purchase through bank statements or credit card bills. Photos can also act as evidence; a photo of you wearing your stolen Rolex for example, can be included with your claim.

3. Report the incident
If something does go wrong, call the insurer immediately to log the claim and check what you have to do next. Take a copy of the policy with you and follow it carefully to avoid delays. If any of your possessions are stolen, immediately contact the local police, hotel management or tour operator and get written confirmation of the loss.

4. Follow instructions
In the event of a medical claim, when large sums are often involved to cover medical expenses, it’s even more important to follow your policy instructions to the letter and phone your insurer for guidance if you’re unsure. Use your valid European Health Insurance Card, and keep receipts of any treatment or medicine you receive.

5. Follow up at home
If you haven’t done so already, fill in the claim form when you return to the UK. Provide as much detail as possible, and include all your supporting evidence. Keep hold of correspondence between you and the insurer, and record the details of all phone calls.

6. If your claim is rejected
Suspected fraud isn’t the only reason your claim may be rejected; the most common grounds are that you are simply not covered for something or a legal technicality in the small print. You can approach the Financial Ombudsman Service for advice, or appeal to the insurer yourself, providing any additional information or evidence to support your claim.

Cheap holiday insurance is a must!
When buying your cheap holiday insurance, don’t assume that every policy is the same. Your needs may be different from others, so make sure the policy you buy provides the cover that you require. Read the small print, check the level of cover and ensure you are covered for any activities that you want to undertake. Carry your travel insurance documentation with you on holiday and keep the 24-hour emergency medical assistance number on you at all times along with your policy number. Get an instant quote from 24/7 travel insurance online, for just £5.91† 24/7 travel insurance will cover you for a 3-day trip to Europe!

Premium £5.91 includes Insurance Premium Tax; based on an individual traveller aged under 55 taking out a Standard single-trip policy for 3 days in Europe including personal possessions cover and purchased within 14 days of departure date. Cover details and prices are correct at time of going to press (November 2009) and are subject to change.

* Source – Aug 09