Difficulty getting adequate travel and health insurance might cause serious problems for some snowbirds this winter.
Many Canadians travel to other countries for several months every year to escape the northern winter. These snowbirds, as they’re called, usually buy insurance to supplement their provincial health plans while they are away. But federal government travel restrictions, and the risk that travellers might require treatment for Covid-19, have made insurance harder to get.
“There are a lot of insurance companies that don’t offer the coverage now. They stopped offering the coverage beyond March when [the government] had everyone return home,” said Jana Ray, Chief Membership and Benefits Officer for CARP.
(CARP, formerly the Canadian Association of Retired Persons, is Canada’s largest advocacy group for older people.)
Ray says some insurers are offering what they call Covid coverage, but travellers should be careful. Often the coverage is for $100,000, she said, but if you are hospitalized for Covid-19, “that won’t last you a week.”
If you are able to claim at all.
“Some of the organizations who have touted to offer coverage have indicated that there is a pretty healthy list of where they could deny coverage,” Ray said.
“If you’ve tested positive for Covid at any point in the last 12 months, that would be, interestingly enough, a denial of coverage. If you’ve tested positive and recovered, and no longer test positive, that would still be reason for a denial of coverage.”
“And the coverage amounts themselves are, frankly, insufficient. The insurance companies might offer $50,000 or $100,000 specific to Covid-19-related insurance. But if you actually were admitted to hospital and put on a ventilator, you’d burn through that in less than a week.”
And with some states already overwhelmed with domestic cases—Florida and Texas, for example—you might not even be able to get treatment.
Trevor Duchesneau is a broker with Tannas Insurance in St. Paul. He says insurance companies are working to create policies that reflect the risks of travelling during the Covid-19 pandemic.
“The insurers and looking at options and trying to come up with solutions. They’re in the midst of making some major changes as of right now,” he said.
“Give it 30 to 45 days, there’s going to be a little bit more information surrounding that.”
Ray said travellers should ask clear questions about their coverage and be sure to read the fine print. They need to know if they are covered for full trip cancellation, and if they have health coverage specifically for Covid-19.
“I would also caution those with specific comorbidities—if you have issues with heart, with respiratory, diabetes, if you have cancer. Most of these people when travelling might have sought out various policies in the past. They automatically would not be eligible for any kind of Covid-19 coverage with those morbidities,” she said.
“It’s not worth the risk to be under-covered.”
Duchesneau says he expects any new products coming out in the next six weeks or so will be very specific.
“It’s at the forefront of everyone’s mind,” he said. “If you’re going to be buying coverage, there will be lots of questions around Covid.”
Insurers will give clear instructions to brokers about the specifics of their policy. “They’re going to be like, make sure that the policyholder knows ‘A, B, C, D’ when it comes to Covid. So it’s not going to be something that was hidden in policy wording and the policyholder didn’t know about it,” Duchesneau said.
“There are going to be big, bold words on the front of your policy, just so you know these are excluded in your policy.”
Ray says there is another problem many snowbirds will face: paying for two homes and having nowhere to live.
Especially in Ontario and Quebec, she said, people often have a summer place in Canada as their primary residence and an owned, land-lease, or rented property in the US or elsewhere for the winter months.
If their summer home is just a cabin at the lake, and if they aren’t able to travel south, they may have to rent an apartment for the winter. Many can’t afford to do that.
“The challenge, of course, is that it’s not just a matter of whether or not they can go down and travel. It could very well be that they are, frankly, homeless,” she said.
As of now, the Canadian government is not recommending non-essential out-of-country travel. Ray sees a possibility that some areas that depend on Canadian snowbirds to sustain their economies will start to offer incentives to travel.
With availability of adequate insurance still uncertain, that could put Canadian travellers at risk.
“I’ve heard of some U.S. providers who are trying to entice Canadians to travel,” she said. “It wouldn’t surprise me if the American government starts to subsidize or really push the promotion of travel products and travel insurance products to entice international travel to the U.S.”
This puts snowbirds into what Ray calls “a delicate balancing act,” trying to determine what the risk is; if they are covered against it; or, in the worst case, if they would be able to get treatment at all.
It also represents a dilemma for CARP as an advocacy group.
“When people tell us that they want to go, they want us to be able to defend their rights to go. At the same time, though, we also want to exercise so much caution around this just because Covid does unfortunately have a significant impact on older populations, as we’ve seen,” Ray said.
“They have their rights to live out their retirement as they choose. That’s the whole point, just being empowered to do that. So it is a bit of a delicate balance for us, but we do hope that people will stay safe and be vigilant in maintaining their overall safety and security.”