Is COVID-19 covered by insurance?

4 March 2020

Is it covered by insurance?

From January to March this year, the Consumer Council received a total of 48 insurance-related complaints, of which 6 were travel insurance cases involving the novel coronavirus.  The complaint mainly concerned that the insurance policy did not explicitly state that the new coronavirus was not covered, but the insurance company refused to accept claims for cancellation or shorten the duration of journey due to the outbreak.  As the situation of each complaint case is different, the Council will discuss the contents of the different cases with the insurance industry and mediate with insurance companies;
In view of the outbreak of the novel coronavirus, many outbound travelers are worried about whether travel insurance will offer hospitalization compensation and quarantine allowance if they become infected while traveling overseas. The Council reminds all to understand the terms of travel insurance to protect your rights before departure.

1: Does travel insurance cover the novel coronavirus pneumonia?

The Government has included "Severe New Infectious Pathogen Respiratory Disease" (ie Novel Coronavirus) as a statutory notifiable infectious disease on January 8 to strengthen surveillance. Consumers need to be aware of whether infectious diseases are covered by the policy terms. The insured person should be aware that there is a chance that the designated body ("Government" or "WHO") has not published the designated area and the insured person has not obtained the desired protection.

In May 2018, the Consumer Council published a survey report on travel insurance.  It reviewed the policy terms of the 16 insurance companies obtained at the time and came to the following observation:

• 11 companies' policies define "Infectious Disease"

• 7 required infectious diseases that have been transmitted from person to person and that have been widely spread among the local population by the World Health Organization.

• 3 required infectious disease-related information to be announced by the “government” and require quarantine.

• 1 prescribed infectious disease must be published by the "Hong Kong Government" under the Prevention and Control of Diseases Ordinance, Chapter 599 of the Laws of Hong Kong.

• 5 companies' policies do not define "infectious disease"

2: Is it protected if the trip is canceled due to travel alert?

Many travel insurance policies provide different levels of protection for black/red/yellow outbound travel alerts, such as cancellation of the itinerary, or cash allowance on travel alert.  If the Hong Kong government issues travel alerts to other regions/countries, some travel insurance policies provide compensation for cancellations and usually cover some non-refundable travel costs.  However, it must be noted that as some insurance companies have already established the widespread of this new type of coronavirus as an existing risk, insurance policies purchased after a certain date may not provide compensation even if they are protected by outbound travel alerts.  Details are subject to the terms of the policy.  The insured should first ask the tour operator for the cost of canceling the itinerary. The expenses that cannot be recovered can be claimed from the insurance company according to the terms of the insurance policy.

(From the Hong Kong Insurance Association )

3. Is it covered by the insurance if one infected at the destination?

If the insured person is unfortunately infected with the novel coronavirus at the destination during the tour, it is required to go to a local registered hospital for medical treatment to be covered by overseas medical expenses. If the itinerary is changed accordingly, additional accommodation and transportation costs will be covered. If the insured person is unfortunately infected with the novel coronavirus before the trip and is unable to depart, travel protection will be covered. As the products of different insurance companies are different, the policyholder should pay attention to the terms of the policy. They may also check with the intermediary or insurance company.

(From The Hong Kong Federation of Insurers)

4: Is it covered by insurance if one has to cancel the trip or quarantine at home?

If the trip is canceled due to the epidemic, please pay attention to the following protections:
The 14 company policies surveyed will provide travel cancellation protection for the insureds who need to undergo mandatory quarantine, but there are also individual policies that do not provide protection for "quarantine at home"; the policies of 11 companies specify that when an unexpected outbreak of an infectious disease suddenly occurs at the destination of the planned trip within 7 days before the scheduled departure date, the insured can be protected if the trip is canceled. Do take note that the clause generally only covers emergencies at the destination of the trip, which it has to reach "emergency" and "unforeseeable" situations, such a case does not apply in Hong Kong. If the insured person has purchased the travel insurance, the destination of the itinerary has been declared an epidemic area by the "Government" or "World Health Organization", the insured person will probably not be protected.

5: Is there a cash benefit for infectious diseases?

The insured person is forced to be quarantined during the journey or within 7 days after returning to Hong Kong due to suspected or confirmed infection with infectious diseases, the insurance company will provide the insured with cash benefits in accordance with the terms based on the number of quarantine days. The insured must present documents proving such mandatory quarantine is required by the government agencies for infection or suspected infection.

6: Is there a medical hospitalization benefit after infection?

Not necessarily. The insured person should be aware that insurance policies generally have non-insured clauses. If the insured person has purchased the travel insurance and the destination has been declared as an epidemic area by the "government" or "World Health Organization", it is likely that the insured person will not be able to enjoy such medical protection.

7: Is there any compensation on the cruise?

As far as travel insurance is concerned, if travelers are suspected or confirmed to be infected with the novel coronavirus and are therefore forced to be quarantined on a cruise ship / designated quarantine premises, general travel insurance provides mandatory quarantine cash benefits. However, if the passenger changes or cancels the original mooring port due to this situation, it is not the designated risk of cruise travel insurance. In the event where the cruise company has canceled the original mooring port purely on precaution, it is the service provider's failure to provide services and is generally not insured.  Passengers should check with the operator for a refund or compensation. As of early March, the Consumer Council has not received any complaint about refusing to provide "quarantine cash subsidies due to infectious diseases" to customers who were required to quarantine on cruises.
Please visit “Together, We Fight the Virus” webpage of the Consumer Council to understand the remedial measures of various insurance companies regarding the outbreak of the novel coronavirus: