Personal finance expert Martin Lewis has issued a vital guideline for individuals navigating travel insurance claims, particularly when they hold policies from multiple sources. During a recent episode of The Martin Lewis Podcast, the money-saving guru emphasised that honesty is paramount when dealing with insurers, especially regarding questions about additional coverage.
The Double Coverage Dilemma
Many travellers might not realise they have overlapping travel insurance, which commonly occurs when both their workplace healthcare plan and bank account include such benefits. Martin Lewis clarified that while possessing dual policies isn't problematic, claimants must understand they cannot profit from making multiple claims for the same incident.
Listener's Real-World Query
The discussion was prompted by a listener named Matt, who emailed the show with a practical concern. He explained: "I receive travel insurance as part of my HSBC bank account, but I also have travel insurance from a workplace healthcare plan. What happens if I need to make a claim? Can I choose who to claim from? Or do I need to notify both?"
Matt added that while he hasn't needed to claim yet, he wants to avoid potential issues. He noted that his bank policy offers more comprehensive coverage, but he cannot opt out of the company plan without declining workplace healthcare entirely.
Martin Lewis' Essential Rules
In response, Martin Lewis outlined several critical rules for dual policyholders:
- No Profit Principle: "You cannot profit, you can only get your cost back," Martin stated. He warned that claiming the same amount from both insurers would constitute a breach, as it would effectively mean making money from an incident abroad.
- Honesty Requirement: "The second rule is you can choose who to claim from, but when you're making that claim, you must answer honestly," Martin explained. He stressed that insurers typically ask if you have other coverage, and you must always disclose this information truthfully.
- Strategic Claim Choice: Martin advised that claimants can select which insurer to approach, recommending they opt for the policy providing the best coverage. He noted that the chosen insurer might attempt to recover costs from the other provider or request you to do so, depending on specific policy terms.
Practical Implications
Martin Lewis concluded that while having a single policy simplifies matters by allowing you to answer 'no' to questions about other coverage, dual policies can be managed effectively. He told Matt: "So you should be covered, and yes it's simpler to have one so you can answer no. But in your case, you can't only have one because you're getting better cover from your bank policy anyway."
This guidance underscores the importance of transparency in insurance claims and provides a clear framework for travellers navigating complex coverage arrangements. By following these rules, policyholders can ensure they remain compliant while maximising their protection during travels.
