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Travel insurance for accidental death

How does travel insurance pay when someone passes away while travelling?

Updated

Most travel insurance policies will pay benefits to a policyholder’s estate or beneficiaries if they pass away on their trip. How travel insurance policies pay for death is not one of the most important aspects of cover to consider, but can be looked at alongside other features to work out what kind of value for money you’re getting with different policies.

Name Product Medical Cover Cancellation Cover Luggage and Personal Effects Cover Default Excess
Cover-More Comprehensive
Unlimited
$10,000
$25,000
$250
Includes unlimited cover for emergency medical, accommodation and transport expenses, $25,000 cover for luggage and travel documents, and $10,000 for legal expenses.
Holiday Rescue Comprehensive
Unlimited
$50,000
$5,000
$100
Comprehensive travel cover that includes unlimited emergency medical with no excess, up to $5,000 for lost and stolen items, and 24/7 access to a registered nurse abroad.
Cover-More Annual Multi-Trip
$1500
$10,000
$5,000
$25
Peace of mind as you travel the world with insurance that covers you over a 12 month period. An affordable option for those who take multiple trips over the year.
Holiday Rescue Essentials
Unlimited
$50,000
$0
$100
Essentials travel insurance protects you abroad with up to $1,000,000 for personal liability, $500 for dental expenses, and more.
Cover-More Domestic
$1500
$10,000
$2,500
$25
Travel around New Zealand with the security of $200,000 in personal liability cover, up to $4,000 for rental vehicle excess and $10,000 in cancellation cover.
Holiday Rescue Domestic
No cover
$50,000
$0
$100
Cover as you travel around New Zealand with $5,000 for rental vehicle excess, up to $1,000,000 in personal liability protection, and $5,000 in alternative travel expenses.
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Keep reading to find out about the general terms and conditions surrounding accidental death cover.

How and when do travel insurance policies pay for death?

Travel insurance policies will usually cover death either as a standalone benefit or as part of the available accidental injury benefits.

It is important to remember that claims need to include details of both the accident and the injuries or death which resulted, and that both of these factors need to meet all requirements.

It has to be a physical accident.

Death benefits are typically only paid in the event of an accidental injury which resulted in death. In other words, there needs to be a specific eligible accident event, clear injuries which resulted from it, and then those injuries need to be the cause of death. Unless it says otherwise, you can assume that a travel insurance policy will only pay death benefits in these situations. Insurers typically define accidents as unintentional events which cause these types of injury.

  • If an accident leads to an illness or disease, and then that illness or disease proves fatal, it may or may not be covered depending on the wording of your policy. Some insurers will specifically exclude these.
  • Some insurers specify that there is no cover for deaths resulting from the accumulation of multiple injuries and that there needs to be a single injury identifiable as the cause of death. This can rule out certain accidents that would otherwise be covered.

Missing doesn’t mean dead.

Missing people are covered by travel insurance death benefits in very different ways depending on the insurer.

  • Some insurers specify that they need reasonable cause to believe a missing person died of accidental injuries in line with the policy terms.
  • Some insurers will accept people missing in transport accidents as dead of injuries.
  • Some insurers, who do not specify any form of death benefits for missing people, will typically not pay any benefits in the event of a disappearance.

How do travel insurance policies cover disappearances?

It depends on the insurer and the situation. Consider these examples to help you understand the differences.

After a plane crash someone is missing

  • Listed policies that mention cover for disappearances in transport incidents would pay death benefits.
  • Policies that do not specifically mention disappearances would not pay any death benefits.

A traveller has mysteriously gone missing

  • Some policies will pay benefits for disappearances, the same as they would for an accidental death.
  • Some policies will only pay benefits in the event of a disappearance if there is reasonable cause to believe that the missing person died of an injury in line with the policy requirements.
  • Policies that do not specifically mention disappearances would not pay any death benefits.

Time limits apply. Benefits are only payable if the death occurs within 12 months of the accident and if it was caused by an injury sustained in this incident.

  • Even if it meets all other conditions, benefits will not be payable after this time.
  • Benefits are still payable even if death only occurs months later, as long as it is shown to be the direct result of injuries sustained in the claimable event.

The accident and the death are not the same. The event which caused the injury (the accident) and the injury which caused the death are two separate parts of a claim and separate conditions can apply to both.

  • Some, but not all, insurers specify that the death must take place while you’re travelling and while your policy is active. Others can still pay benefits even when death occurs after returning home.
  • All insurers specify that the accident must occur while you’re travelling.
  • Some travel insurance policies have a window after an accident in which policyholders can make claims for losses which resulted, such as death. For some insurers this window is 12 months after an accident, while for others the window closes as soon as the policyholder returns home.

Accidental death benefits are also subject to general exclusions and need to meet all applicable policy conditions.


Exclusions: When will travel insurance policies not pay death benefits?

Benefits payable may be subject to both general exclusions and specific ones. In particular, it may be impacted by:

  • Reckless or unreasonable behaviour: When considering any claim, insurers will assess whether your actions were reasonable in the situation. Claims may be denied if they result from actions where you knowingly put yourself or others in danger, or did something that a reasonable person in your situation would not have done.
  • Terminal illnesses and pre-existing conditions: Terminal illnesses qualify as pre-existing conditions, and death benefits for those are typically not payable on the grounds that it’s a pre-existing condition. In the unlikely event that a pre-existing condition is shown to be in any way responsible for the accident, in that it wouldn’t have happened otherwise, benefits may still be declined.
  • Failure to take precautions and obey instruction: If you were not taking reasonable safety precautions such as wearing a helmet while motorcycling, or were not obeying all instructions (including local laws) at the time of an accident, insurers may refuse a claim regardless of whether or not doing so would have prevented the accident.
  • Deliberate injury and suicide: Deliberately self-inflicted harm, including suicide, is not covered by travel insurance policies.

How much do accidental death benefits usually pay?

Travel insurance policies are not designed to provide long-term benefits for your dependants. That’s what life insurance is for. Instead, travel insurance death benefits are designed to cover the unexpected costs, make sure you have the resources to return home or carry on, and generally offer a small form of compensation.

  • Maximum benefits are usually in the $20,000 to $25,000 range with international comprehensive travel insurance policies, and are generally about half that, or not included at all, with more basic cover.
  • When included as part of the accidental injury benefits, rather than as standalone death benefits, other accidental injury claims will also count towards the same limits.
  • Accompanied dependants are typically covered to much lower limits, but with all the same conditions. Whether someone can qualify as an accompanied dependant, or has to get their own travel insurance policy, depends on the insurer and may be worth considering when comparing travel insurance policy death benefits.

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