“We Did It!”

Posted on March 31st, 2020 by Medipac

That was the headline on the very first CSANews magazine published in December 1992. The Canadian Snowbird Association had just won their first victory by implementing the Medipac Travel Insurance plan for members. Compared to prices available at the time, members saved more than $25 million in premium costs. That equated to more than $650 per person, or $1,300 per couple.

Medipac International was chosen after an exhaustive search by the Snowbird Steering Committee; 43 different insurers and administrators made presentations to the committee for consideration. Medipac won with a unanimous decision by the Steering Committee members in a straw vote. To be very rigorous, the top three presentations were sent to KPMG, then Peat Marwick, for further review by experts. They wholeheartedly recommended Medipac as “far superior” to the other presentations and the Medipac Travel Insurance Plan was born.

Over the years, many insurers, brokers, administrators and associations (some phony) have tried to duplicate the Medipac program, but they have still been unable to do so. They have had cheaper prices in some cases, but that is normally for very inferior benefits and sloppy medical assistance, if any, and long waiting periods. Some have limits that are too low to pay a simple hospital bill. Some have what we call in the industry a “firm pre-existing condition clause,” which means that if you have EVER had anything,it is not covered by your insurance. Think about that for a second or two…the insurance which they are selling you will not cover you for the most likely cause of your claim. Don’t waste your money!

We received a very nice note from one of our long-term clients stating that he understood why prices have gone up so much due to the dollar, and he questioned whether the medical inflation in the United States had increased. He had obviously spent the time to figure out that the dollar depreciation was not quite enough to justify our rate increases – and he was right. The medical community in the U.S. is a mess under Obamacare. Of the 24 special health-care co-ops set up to insure Americans, 13 of them have shut their doors or gone bankrupt. The new insurance rules allow large deductibles (which is all that most people can afford) and the hospitals are unable to collect many of these amounts without denying service, which is illegal. The whole system will collapse eventually.

But back to the medical inflation. Our average hospital bill, per day, in the U.S. last year was $15,981; this year it is $19,345. A doctor’s office visit (usually with some screening tests) was $2,172 last year; this year, the average bill is $2,498. That’s a ridiculous average medical inflation increase of about 20% in one year. We have not priced in all of these increases as we hope to do better next year in obtaining even better discounts to these bills. We shall see.

Another member writes that he did some research on the Internet and could not find us in the top-five cheapest companies for travel insurance. That is because we are not there at all. Only plans that pay commissions are “rated” and I use that term very loosely. Medipac does not pay commissions to brokers and, as such, we are never included in price comparisons. There is a real danger in comparing prices because there is a huge difference between a lemon and an apple.

Only two types of insurance can be easily compared – one is term-life insurance and the other is automobile insurance. Both of these policies and their conditions are controlled by governments. So that is an apples-to-apples comparison in almost all cases. Let’s look at house insurance for another few seconds. Do you have sewer backup coverage? Does your policy include flood and/or earthquake coverage? Do you even know what “land subsidence” means? (It means that if your beautiful ravine home slides into the ravine, you are not covered.) If you live in Toronto or Vancouver, you can kiss that million dollars-plus good bye. Incoming CSA President Karen Huestis had a massive sinkhole open up in her front yard in Florida. She can tell you what a mess – and how expensive – it is to have incomplete coverage. We always seem to learn the hard way, including myself. Did you really read your travel insurance policy?

Someone stole my painting, my diamond ring, my lawnmower, etc. Theft is NOT covered under 95% of homeowners’ policies unless the item is listed specifically and a separate additional premium is paid. Burglary, however, is covered, but do you want to split those hairs with the claims department of your insurer? Accidental breakage requires the same individual listing of items so, if you lose that two-carat diamond in your ring (breakage), there is no coverage. Oh, and if you leave the same diamond ring in the golf club washroom and it disappears – that is called “mysterious disappearance” – not covered, of course. Does anyone now actually think that we can pick our home insurance policy on price alone???

Travel insurance can be much more complicated than home insurance. Read your policy and understand your policy! But also, buy Medipac, they really are the best.