The preexisting-condition clause

By Wayne Wirtanen
This item appears on page 58 of the July 2012 issue.

(Part one of two parts)

This article describes what a traveler needs to know about the preexisting-condition clause when deciding whether or not to purchase an insurance policy that covers only overseas medical expenses and emergency medical evacuation. I call this type of policy the “Betty James Travel Insurance Strategy” (Sept. ’10, pg. 54).

It’s also described as a “zero trip cost” policy. This type of policy eliminates the cost of the more expensive trip-cancellation/interruption coverage while maintaining all of the other protections of a full-feature policy, such as baggage loss, trip delay, etc.

Every travel insurance policy contains a preexisting-condition clause. Fortunately, for travelers, this does not mean that coverage for a preexisting condition is excluded, only that claims for those conditions will be paid only if the insured person’s condition has been “stable,” as described in the policy.

In every full-feature travel insurance policy, “stable” is defined, basically, as a person’s health having been unchanged, requiring no change in medical treatment and requiring no change in medications, for a “look-back” period of 60 to 180 days from the time of policy purchase. (For all zero-trip-cost “Betty James” policies without a waiver, the look-back period begins on the date of departure.)

If the purchaser of a policy is comfortable that, in the case of a need to present a claim, he would be able to demonstrate the required “stability” as defined in the policy, then the preexisting-condition clause should be of no particular concern.

With a policy in which you have not received the waiver, in order for a claim to be paid, paperwork would be requested by the insurance company — a chore but not necessarily an onerous one. If your primary-care doctor maintains a complete file of your medical history, his appropriate records would be sufficient to demonstrate stability.

Many travel insurance policies will not waive the preexisting-condition clause unless one purchases a full-feature policy that includes trip-cancellation/interruption coverage. This eliminates the possibility of purchasing from those companies a “Betty James Strategy” policy with a waiver.

It’s desirable to get the clause waived, no matter what policy one purchases, because, with a waiver, claims relating to preexisting conditions will not be challenged and the paperwork that would have resulted will not be required. Pay attention to the policy text or specifically ask the policy seller about a waiver. Some of the most basic policies do not offer a waiver.

Good news for fans of the “Betty James Strategy”

After I described the “Betty James” policy, ITN printed a statement of mine in the following issue explaining that the policy does not allow for a waiver of unstable preexisting medical conditions (Oct. ’10, pg. 69). In subsequent research, I discovered that, fortunately, for travelers who opt for a “Betty James” policy, three travel insurers currently will waive the clause, prompting this article.

These companies are shown below and listed in the chart on the opposite page. As the chart describes, they have policies that include medical coverage of between $50,000 and $250,000 and medical-evacuation coverage that ranges from $250,000 to $1,000,000. The cost for a 75-year-old on a 30-day trip runs between $54 and $133 (prices subject to change).

Travel insurance company
Insurance policy plan
medical coverage

Medical-evacuation coverage

Cost of 30 days' coverage for someone age 75
TravelSafe Vacation Classic Primary, $100K $1M $133
M.H. Ross Advantage Bridge Primary, $100K $500K $70
CSA Freestyle Secondary, $50K $250K $54
CSA Freestyle Secondary, $250K $1M $65
This chart compares a few insurance companies that offer policies with overseas medical and emergency-medical-evacuation coverage ONLY but which do allow for a waiver of the preexisting-condition clause.

TravelSafe Insurance (40 Commerce Dr., P.O. Box 7050, Wyomissing, PA, 19610; 800/523-8020).

M.H. Ross Travel Insurance Services, Inc. (9225 Ward Parkway, Ste. 200, Kansas City, MO 64114; 800/423-3632).

CSA Travel Protection (P.O. Box 939057, San Diego, CA 92193-9057; 800/873-9855).

You can contact these companies directly or talk to Dan Drennen at Travel Insurance Center (Omaha, NE; 402/343-3621). He’s a “Betty James Strategy” specialist.

To qualify for a preexisting-condition-clause waiver, one must purchase the policy within 21 days of the first trip deposit with TravelSafe or within 15 days with M.H. Ross or by the date of the final trip payment with CSA.

Next month I will expand on preexisting medical conditions waiver qualifications, including those for full-feature travel insurance policies. Happy trails!