Allianz unit debuts new COVID-19 travel insurance policy in Canada

October 16, 2020.
In this Friday, June 26, 2020 photo the logo of the Allianz Group insurance is pictured in Berlin, Germany. (AP Photo/Michael Sohn)

In this Friday, June 26, 2020 photo the logo of the Allianz Group insurance is pictured in Berlin, Germany. (AP Photo/Michael Sohn)

unveiled a new travel insurance policy that provides up to $1 million for emergency medical treatments due to COVID-19, a segment of the industry that has gained renewed interest as insurers bet on a rebound in global travel.

The Munich-based firm, one of the largest insurers in the world, said Friday that the new policy will be carried by Allianz Global Assistance, its North American travel insurance and assistance arm. The policy will be distributed by the unit’s national network of more than 9,000 travel agencies and insurance brokers.

Allianz acknowledged that travel, especially internationally, remains highly restricted, but it is betting some Canadians will still travel for work and family reasons as airlines around the world push to reopen international borders.

“Our hope is to remove barriers that might otherwise lead a traveler to avoid seeking treatment, which will hopefully help to limit the spread of the virus at a destination while ensuring their health fully recovers before returning to Canada,” said Lucy Hathaway, chief sales officer at Allianz Global Assistance.

The new COVID-19 Insurance and Assistance Plan can be purchased on a standalone basis and only covers expenses linked to the virus. It can be used to supplement an existing health insurance plan that does not cover COVID-19 risks, Allianz said.

The policy covers medical expenses related to the treatment of COVID-19, the cost of traveling to a hospital and the cost of returning a travel companion or children home if the policyholder is under quarantine. 

It also pays up to $150 a day per person, for a maximum of $2,100, in quarantine dining and accommodation costs, and $300 per person if the policyholder is denied boarding at the airport following a positive COVID-19 screening. 

Coverage may be purchased by people of all ages, though people who have previously tested positive for COVID-19 must provide a negative test result before they depart from Canada. Prospective policyholders must also have no signs or symptoms of the virus for two weeks leading up to departure.

This latest offering from Allianz complements a free flight insurance policy it created in partnership with Virgin Atlantic for passengers of the U.K.-based airline in late August. The plan covers entire trips booked with the airline with no cap on the length of the trip, and up to GBP 500,000 ($646,000) in emergency COVID-19 medical costs.

Allianz’s travel insurance businesses are currently facing scrutiny by Australian regulators, who allege that the company engaged in “misleading” sales of insurance products through travel booking site Expedia.

In a lawsuit filed against the company’s Australian subsidiaries in late September, the Australian Securities and Investment Commission said Allianz and AWP Australia sold insurance to people they knew would be ineligible for claims under its travel insurance policies.

Still, Allianz followed a number of traditional carriers and insurance technology startups that launched new travel solutions that specifically cover COVID-19 risks in recent months. So far, Allianz’s offering is the largest new COVID-19 travel insurance product on the market based on the payout ceiling.

In early October, Vancouver-based insurtech Goose Insurance Services partnered with Lloyd’s of London to roll out the world’s “first standalone worldwide pandemic insurance” in the Canadian market. For a minimum of $99 per year, the policy covers up to $500,000 in COVID-linked expenses.

More recently on Monday, the Zurich Insurance Group unveiled its own new insurance policy for business trips that includes advisory services through its subsidiary.

Others, however, have not struck it rich from their existing travel insurance lines due to a sharp uptick in canceled flights. In May, Italian insurer Assicurazioni Generali posted EUR 113 million ($132 million) in net profit, down from EUR 744 million ($871 million) in the first quarter, due to big losses in its travel insurance business.

Canada’s international borders have been closed to non-Canadian residents since March 18 and to most Americans since March 21, but international flights into Canada have not been banned by the government.

Since they suspended all international flights this spring, Canadian airlines WestJet and Air Canada have resumed the flights, though all global arrivals are limited to one of four airports. 

In a radio interview Wednesday, Canadian Prime Minister Justin Trudeau suggested the U.S.-Canadian border may remain closed for some time as case numbers in the States continue to climb. On Friday, the U.S. surpassed 8 million confirmed cases, according to the New York Times.

--Additional reporting by Beth Newhart, Carrie Wood, Allie Ciaramella