Friday, March 12, 2010

Trip Insurance Woes

Now I know why MetLife has those ads that say, “Get MetLife. It Pays.” Because other insurers do not.

A friend of mine was planning to fly to Europe and had to bump the date of his tickets because a close relative died. He'd bought trip insurance since it was such an expensive set of flights. His carrier was Delta Airlines, which told him that he must deal with its insurer, Access America. Access America won’t accept the funeral home’s letter. Access America won’t accept the dead person’s death certificate. Access America has demanded the dead person’s medical records. Huh? If my friend comes up with those, no doubt Access America will be demanding the dead person’s high school report cards. Or a permission slip signed by the dead person’s dead parent. People must sit around at Access America and vie with each other to come up with more and more difficult “proofs” that make it impossible for any claimant to get paid. This is so mean and rotten that it is almost surreal.

It makes me ashamed to be an American when companies like Access America can get away with crap like this. Ashamed to be a fellow human, too. How low is our society, that we allow companies like this to stay in business and keep preying on people?

I have proof that Access America has been pulling this for decades. Over 20 years ago, my mother took a Saga Holidays tour of Europe, and one of her suitcases was stolen. Saga bumped her to Access America, which refused to pay for the lost suitcase or its contents. How? By demanding more and more receipts—and only the originals would do—for items that Mom had bought many years before. Mom called. Mom wrote. Finally, Mom gave up.

And that’s what these companies depend on. They wear you out with more and more ludicrous and unfair demands. (Just like the health insurance companies, come to think of it.) They won’t give up until somebody bigger comes along and threatens to squash them like the bugs they are.

My friend has already gone online and found long lists of complaints about Access America. You can read them here. From these sad stories it appears that Access America sells insurance it has little or no intention of ever making good on. And Delta Airlines enables Access America. It can be hard to protect yourself against companies like Access America because it is a reinsurer, like AIG. You might sign up unknowingly with some other company, like Delta Airlines, only to discover after the fact that you have been tossed to the wolves.

I told my friend to go to AARP’s columnist, or to try local action lines, and of course to write a letter to the president of Delta Airlines. I guess contracting with an insurance company that does not pay on claims is Delta’s way of cutting costs. It’s worth telling the president of Delta that we want decent treatment. Otherwise, why not pick some other airline?

Can anything be done about companies like Access America? The insurance lobby in Washington is large and well-funded. (Of course it is, because they aren't paying claims.) Insurance is usually regulated on a state-by-state basis, but if regulation went to the Federal level, no doubt there would be less regulation rather than more. Any way you figure it, we the customers lose.

The moral of the story? If you want insurance for anything, first find a trustworthy insurer. Don't sign up for it blindly as an afterthought without knowing who the insurer is. And if you find yourself caught like this, persevere. Keep fighting until you wear the enemy out. With every insurer there is a moment when it starts to cost the company too much money to keep denying your claim. You just have to keep on until that moment is reached. Hopefully, you'll live that long.

Edited to add: My good friend Ron Fradkin, very experienced in the insurance industry, advises that anyone who has a problem with an insurer contact the state insurance department. State insurance departments have the power to fine noncompliant insurers, even on a daily basis; thus they'll get you quick action. This does vary by state, but it's excellent advice. Don't give up!


Mark Cipolletti, VP of Communications said...

I'm sorry to hear about your friend's experience. If you would like to send me the claim number, I would be happy to investigate.
The claims examiners need a form from the physician to determine if the death was caused by a pre-existing condition. The death certificate only verifies that your friend's relative died. The Air Ticket Protector products sold through our airline partners don't typically cover pre-existing conditions. I'll assume that this was the product they purchased.
Problems like these are the exception not the rule. In the last five years we've paid hundreds of millions of dollars in claims. That's a lot of airline tickets.

Hopeful Lily said...

I'll pass on the info.

Many people have to make unanticipated changes in flights because someone who is ill suddenly takes a turn for the worse. Your trip insurance clearly does not cover them--but as the comments posted elsewhere show, lots of people buy insurance from Access America thinking the opposite. When this many people are confused about the nature of the insurance product you sell, you need to change how you sell it.

I still don't understand why Access America refused to just pay a set, reasonable amount for my mom's lost suitcase and its contents. The company offered less than it would have cost to replace the suitcase itself, and that's just not right. I also hold Saga Holidays accountable since that company targets the elderly as their clients, a group that is well known not to be fighters when it comes to their rights.

Hopeful Lily said...

Yet another friend points out that I am using the term "reinsurer" incorrectly as it applies to Access America and AIG. Since trip insurance and certain other kinds of insurance often are not sold directly by the insurance company, but by Saga Holidays or Delta Airlines or some auto dealership, these companies perhaps should be called "blind insurers"--because the public signs up blind to who we're contracting with and what the full terms are.