Coronavirus & Travel Insurance
By Chang Wai Leng and Marlysa Razak
What is Novel Coronavirus?
An outbreak of Novel Coronavirus (2019-nCoV), which is also known as Coronavirus began in early December 2019 and it was first identified in Wuhan and now occurring more widely in China. It is an unknown type of virus that can spread from person to person and most likely by coughing or contact with respiratory secretions of people infected with the virus. The symptoms of Coronavirus include fever, cough, headache, severe pneumonia and difficulty in breathing. People with a low immune system, such as young children, pregnant women and elderly people will easily get infected by such a virus and even cause death.
On 3 February 2020, Coronavirus has now recognised by the World Health Organization (WHO) as an epidemic and it has now constituted a public health emergency of international concern.
According to the Worldometers website, as of 18 February 2020, the rapidly spreading virus has killed 1,873 people from nationwide and nearly 73,333 have been infected since the outbreak emerged last December.
The outbreak of the Coronavirus has given rise to a large number of flight cancellations and quarantines as well as hotels cancellations across the world. Therefore, countries like Malaysia, United States and Australia are temporarily denying the entry of non-citizens who recently traveled to China and/or travellers from China.
Temporary Travel Restrictions
After the announcement of China’s decision to suspend the outbound travels from Wuhan, our Ministry of Foreign Affairs has advised Malaysian to defer their non-essential travel to Wuhan and other affected areas.
After the confirmed cases of Coronavirus in Malaysia, our Deputy Prime Minister, Datuk Seri Dr Wan Azizah Wan Ismail contended that our Government has taken sufficient steps to control and to prevent the outbreak of Coronavirus by imposing temporary travel restrictions on travellers that are coming into Malaysia. For example, Chinese travellers from Wuhan and other regions that are locked down by the Chinese Government are temporarily restricted to travel to our country.
Besides that, our Government has increased the quantities of thermal scanners at the entry points to the country in order to tighten up Malaysia’s border security and laboratories speed up the investigation and detection of suspected Coronavirus patients.
According to the Malaysia Airlines website, the update and temporary travel restrictions into Malaysia are as follows:
- State Government of Sabah has restricted travellers who are holding the People’s Republic of China passports traveling into Sabah. Flights for Kota Kinabalu-Shanghai-Kota Kinabalu has been suspended from 18 February 2020 until further notice; and
- The entry of China travelers and other foreigners who have travelled to China in the past 14 days are restricted to travel to Sarawak. However, other travellers are required to fill in the Health Declaration Form before travelling to Sarawak.
Therefore, passengers who are affected by such travel restrictions can either make fresh booking or request for a refund.
Besides Malaysia, other countries such as Japan and Singapore have also taken sufficient safety precautions by banning China travellers who are holding People’s Republic of China passports and other foreigners who have visited Wuhan from landing or transit at their respective countries unless it falls under some special circumstances.
In this article, we will address the issues on the activation and/or applicability of travel insurance in this situation.
About Travel Medical Insurance and Travel Insurance
Travel Medical Insurance
Travel medical insurance coverage will be determined case by case depending on a few factors such as the time the insurance was purchased, the period in which the patients got sick and whether the person has recently been to China. Insurance companies will take into account the patient’s previous medical records and other circumstances to determine whether it would be considered a covered illness that falls under the travel medical insurance. However, there are few general exclusions. For example, any loss, injury or damage from pre-existing medical conditions, under influence of alcohol or drug and so on will not be covered by the travel medical insurance.
Travellers who intend to travel to China need to be aware that different travel medical insurance plans may have different coverage, where there are certain scenarios that are not covered under the travel medical insurance plans.
Travel Insurance (Trip Cancellation)
Meanwhile, travel insurance differs from travel medical insurance as it covers accidents and losses or any unforeseen events occurring during your trip. Travellers are often advised to purchase travel insurance in order to safeguard against any unforeseen circumstances such as flight cancellation or medical-related illness before your departure for the trip.
Recently, since the outbreak of Coronavirus, travellers who have planned their trip some time ago are highly concerned on whether their travel insurance covers any cancellation of their flights due to the Coronavirus. As of 10 February 2020, there are a myriad of insurance companies that have made announcements on the cancellation of flights. Airlines like Cathay Pacific Airways, Singapore Airlines and more have actually cancelled their flights to China and travellers who have made their bookings will receive emails with further information regarding a refund.
However, it must be noted that trip cancellation insurance is designed to protect against the unknown and unexpected events. However, on 22 January 2020, Coronavirus has now become a “known event” and it is too late for travellers to purchase it now as most of the travel insurance policies have ceased such coverage.
According to the Allianz insurance company website, travellers who have bought their travel insurance policy with Allianz before 22 January 2020 might still have coverage for cancellation of trip to China or to other infected areas, however not for travellers who bought their travel insurance policy on or after 22 January 2020.
The Etiqa insurance company website has also announced that for Etiqa Singapore, claims arising from Coronavirus will not be covered for travellers who have bought their travel insurance policy after 31 January 2020.
Travellers can claim for their trip cancellation if they purchased their travel insurance from AXA Affin General Insurance Berhad prior to 31 January 2020 and at least 14 days before commencement of the trip, with the written confirmation from Airline or Hotel or Travel Operator to confirm the non-refundable prepaid cost of the flight ticket and/or the accommodation. For claims for trip cancellation arising from the purchase of insurance relating to the known event on or after 31 January 2020 are not covered.
Conclusion
Therefore, based on the above information, it is clear that most of the travel insurance purchased after certain specific dates will not be covered for claims made in relation to Coronavirus. Travellers who planned to travel to China and had not purchased trip cancellation travel insurance, it is too late to purchase this coverage now because Coronavirus is already a “known event”. If travelers planned to travel outside of China and had purchased travel insurance, the fear of being infected with Coronavirus is not an acceptable reason to cancel their trip.
Travellers can also purchase Cancel for Any Reason (CFAR) Travel Insurance for their upcoming trip if there are possibilities of their trip being cancelled. Although CFAR policies are expensive, it gives travellers the flexibility to cancel their trip for almost any reason and get most of their money back. However, if travellers already know that they want to or need to cancel their trips and want to buy the CFAR travel insurance now, it is not going to work.
In conclusion, should the outbreak of Coronavirus persist, it would cause a major impact on the economy in Malaysia, as China is one of Malaysia’s most important trading partners. Not only the Malaysia government has done over and above to overcome the outbreak of Coronavirus, but international agencies and the private sectors such as the insurance, flight companies and hotel industries have also followed the footsteps to overcome the negative impact towards Malaysians.
- https://www.worldometers.info/coronavirus/#countries
- https://www.nytimes.com/2020/02/11/world/asia/coronavirus-china.html
- https://www.nst.com.my/news/nation/2020/02/563259/malaysia-enhances-measures-against-coronav irus; https://www.channelnewsasia.com/news/asia/malaysia-travel-ban-china-provinces-lockdown-wuhan-coronavirus-12404030
- https://www.malaysiaairlines.com/my/en/advisory/coronavirus-entry-restrictions.html
- https://www.insubuy.com/coronavirus-coverage-international-travel-insurance/#
- https://www.gobear.com/my/guide/travel-insurance/travel-insurance-guide
- https://www.allianztravelinsurance.com/coverage-alerts/2019-novel-coronavirus.htm
- https://www.etiqa.com.sg/personal/general-insurance/travel/eprotect-travel/
- https://www.axa.com.my/announcement-on-travel-30-01-2020