Woman Denied Travel Insurance Claim After Being Hospitalized for Depression

A woman from Australia has taken legal action against an insurance company she claims discriminated against her after she canceled a trip due to mental illness. The hearings began on Tuesday and mark the first time a claim of this nature was taken to Australian courts, according to ABC’s 7.30.

The incident happened four years ago when Ella Ingram, then 17, was in her last year of school at Melbourne Girls’ College, the Herald Sun reported. She had plans to study abroad in New York when she started experiencing severe depression and suicidal thoughts. After two weeks of hospitalization, her psychiatrist recommended she cancel her trip, so she did. 

When she received a letter denying her insurance claim from QBE Insurance, which provided coverage for her trip, she was shocked.

“For one of the first times, it made me feel really bad and really ashamed to have depression,” Ingram told the Herald Sun.

QBE has a complete exemption of mental health issues in its cancellation policy, even when it’s not a pre-existing condition. ABC’s 7.30 reported the company plans to argue it would suffer “commercial hardship” if it covered mental illness, due to the number of people who experience it.

This is not uncommon — most travel insurance companies don’t cover trip cancelation due to mental health issues, including anxiety, depression and panic attacks. QBE said mental illness exclusion policy is “standard industry practice,” according the Herald Sun.

After she canceled a trip because of her mental illness, Heather, a verified user on Consumer Reports from Westland, Michigan, had an insurance claim denied by Allianz Travel, an American company recently ranked #1 in travel insurance by Consumer Reports.

She wrote:

I had a flight planned and was hospitalized the day before I was set to take off due to mental illness. I called to submit a claim and spoke with a pleasant woman. She asked me to explain the situation, which I did, and said that I would be covered and that I just needed to send in the required documentation. I sent everything asked for and more (which cost me $28 in fax fees at FedEx) but found out about a week or two later that my claim had been denied because mental illness was not covered under my policy.

Although under the Mental Health Parity Act and Affordable Care Act health insurance companies are required to provide mental health coverage, travel insurance is exempt. A typical travel insurance plan does cover cancellations due to injury, illness and hospitalization.

Attorney Ingrid Evans, from The Evans Law Firm in San Francisco, California, said insurance companies that exclude mental health-related claims are just looking for an excuse to deny coverage.

“Insurance companies are in the business of making money, but it’s flat our wrong to use mental health as an excuse,” she told The Mighty. “It’s absolute discrimination.”

Her firm is currently working on a few cases that deal with mental health discrimination and insurance.

Have you ever had an insurance claim denied for mental health reasons? Tell us about it in the comments below.