COVID-19 changed everything—including business travel risks and liabilities. Here, Tanja Lumpp, Hylant Global Benefits Leader, answers questions about travel risks and insurance in general, and the impact of the pandemic.
Q: What obligations do employers have in regard to travel safety?
A: This is a huge topic of conversation that is going to evolve as the world continues to open back up for travel. Employers have a legal and moral obligation to look after the health and safety of their employees. This is referred to as “duty of care.”
There are many ways to interpret duty of care, but business travel and global mobility absolutely heighten the obligation employers have to keep employees safe certainly. Business travel also increases the exposures a company may have in its duty of care strategy.
If employees are traveling with family or have medical conditions, the duty of care scope broadens even further. Fortunately, many travel insurance plans exist today that can cover traveling spouses and dependents, can cover specific conditions, and that have high medical limits and high prescription drug benefit limits. Some policies include evacuation riders and many different options to ensure that the duty of care is met and that employees are taken care of when traveling on behalf of the company.
Q: How have the travel insurance industry and travel insurance coverage been affected by COVID-19?
A: Although there are still travel restrictions and travel hesitations, those organizations that are restarting their business travel are definitely going prepared. There is a more concerted effort to keep employees safe when traveling. Prior to the pandemic, travel insurance was often seen as an unnecessary expense. COVID-19 has highlighted the need for employers to take travel insurance more seriously.
Today, the majority of travel insurance providers do not have exclusions for COVID-19, but employers should always ensure this is the case. In most instances, COVID-19 is treated like any other illness. However, COVID-19 is not classified as an accident for AD&D coverage. Hence, most insurers will deny AD&D claims for death by COVID-19. Life insurance, on the other hand, will typically cover COVID-19 deaths. Employers should always verify that there are no exclusions and that the policies they have in place include COVID-19 coverage.
Q: What does travel insurance encompass, and why is it important?
A: Basically, travel insurance covers any emergency event that occurs when someone is traveling and provides a safety net to ensure that the individual can receive treatment and support.
Business travel coverage can come in many forms, but ultimately it is important to review all policies, including both employee benefits and property and casualty insurance, to ensure there are no gaps in coverage. Keep in mind that travel insurance can have many different names, including business travel accident (BTA), business travel medical (BTM), travel concierge or travel assistance services, and medical benefits abroad (MBA).
Q: Is all travel insurance the same, regardless of what it is called?
A: No. Some policies cover trip cancellation. Some offer greater medical emergency benefits than others. Others include coverage for lost passports. Some policies include concierge service that the traveler can access at any time during a trip. It is important to read the fine print and be aware of the policy conditions.
One of the most important aspects of travel insurance is that it provides benefits for medical emergencies and medical evacuation. Hospital stays and emergency transport can be very costly especially when you find yourself far away from home. There are many reasons to buy travel insurance, but the one that always rises to the top is the cost of a medical emergency. While a $100,000 medical emergency evacuation might not be frequent, it would certainly be devastating without any coverage.
Q: Since travel is still fairly restricted, should employers cancel their business travel insurance policies?
A: No. I highly recommend that employers do not cancel their travel insurance policies. I think it is inevitable that the world will return to mobility and travel, whether that is four weeks or four months from now. It’s best to be prepared.
I think we will see many employers cancel their policies and then forget they no longer have coverage. Once travel picks back up, they will have massive exposures and risks. For example, an employee may need to hastily make a business trip but will have no coverage.
If there is a concern over policy costs, most carriers will adjust the premium levels if the travel frequency has been reduced. I urge employers to stick with their travel insurance plans and avoid any gaps in coverage.
Q: What considerations should employers take into account when restarting business travel?
A: I think it is important to evaluate many different aspects before restarting business travel. Employers should look at the risks involved not just from a COVID-19 perspective, but also from the perspective of what other health concerns or security risks exist. Is there really a need for employees to travel, or can the business be handled virtually? I think we will see companies adapt new policies as we emerge from the pandemic.
Employers also must consider any restrictions that may exist wherever the travel is to occur. What type of government restrictions exist? Are there other restrictions at the destination that will affect how employees will need to behave or what they will need to do if they are exposed to something? Many companies are now monitoring the WHO and CDC for recommendations and assessing the safest actions possible.
It’s important the employers take their due diligence seriously before travel resumes. Everyone must be on the same page as far as expectations, and employees must be equipped with the right information and resources before they travel for business.
Q: Can you give us a glimpse into what the “new normal” for traveling after COVID-19 will be?
A: I think there will be a slower return to international travel than domestic travel, but it will happen. There is no doubt that in-person and face-to-face interaction has an unparalleled value. I also believe that there will continue to be an increase in car rental and train travel for those places that have rail networks.
There will be new requirements for traveling and stepping foot into another country. Whether that is a negative COVID-19 test or a requirement for travel insurance, there will be additional documents travelers will have to provide.
Many airlines and hotels have already adopted flexible booking policies. I think this will also continue to evolve so that travelers can adjust their plans in this uncertain environment.
Lastly and most importantly, I believe there will continue to be a greater emphasis on the duty of care. Employers and individuals will continue to place focus on the need to have a comprehensive duty of care program. This includes being aware of risk factors before the trip, knowing the emergency contacts, having the right travel insurance in place, having a good idea of where employees are and receiving information on developments and alerts in real time. Duty of care will continue to amplify the importance of our number one asset: our people.
[Webinar] Post-Pandemic Business Travel: What to Know Now
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The above information does not constitute advice. Always contact your employee benefits broker or trusted adviser for insurance-related questions.