Hughes Krupica: Surely my insurance will cover me?

We're all offered insurance products with respect to many aspects of our daily lives, such as booking a domestic flight with a budget airline through to compulsory insurance when borrowing monies from a bank. So it's worth pausing to consider whether the insurances we're using, and paying for, really do cover the types of events that occur, or are likely to occur. Insuring for events that are never likely to happen is similar to placing your life savings on Black 8 at a roulette table in Las Vegas immediately after Black 8 came up the last spin of the wheel. However, insurance companies do like to reduce the risks of claims, as is natural in their business.

In Thailand, visitors and residents alike face a multitude of common incidents under which their insurance policies will actually be tested in practical terms – making a claim. No matter how many pages your policy document runs to, or how large your insurance premiums are, you don’t really know what the outcome of a claim will be until you try to make one.

"I'd heard rumours jet-skis were dangerous and were banned. I even watched a mini-series on the Internet showing some shocking violent incidents relating to jet-ski operators and visitors to Phuket. However, believing such incidents were issues of the past, I still let my teenage daughter hire a jet-ski because I thought it would be fun. After paying 3,000 baht for 20 minutes, including free life jacket rental, my daughter returned the jet-ski. The operator informed her very politely that she had damaged the jet-ski underneath and would she kindly pay 80,000 baht compensation. The jet-ski operator said he had consulted with his expert lawyer by telephone, who had told him he couldn’t claim for the damage under his insurance policy and that my daughter must claim under her travel insurance policy if she wanted to get the money back. The operator didn’t have a receipt available to issue for the 80,000 baht cash payment. Is it likely my daughter is covered under her general travel insurance policy?"

To take just one example of the general view on jet-skis for hire, the British Consulate website contains a warning as follows:

“Do not rent a Jet ski as most problems in Thailand are about Jet-skis and motorbikes and scams which revolve around them. Take it from me you can simply leave this alone. It is very problematic.”

Surprisingly (or perhaps not), this advice, and that of other countries, is often clearly ignored.

A jet-ski operator should have partial insurance over the vehicle. However, there's a limit on that policy. Furthermore, the operator will not wish to make a claim against its own policy, especially if the operator believes the user has been negligent or is at fault.

Normally, a standard holiday insurance package will exclude dangerous sports such as parasailing, hang-gliding, scuba diving, bungee jumping and using jet-skis. However, many insurers will ‘up-sell’ add-ons to a package to include jet-skis, but then might exclude claims, which can often lead to surprises for the insured party attempting to make a claim. Such exclusions may be:

(a) If the use of a jet-ski was not part of a tour package and on a schedule or itinerary.

(b) If the jet-ski is not owned and operated through a formal organisation or legal entity.

(c) If the user fails to obtain a receipt and/or evidence of any payments made.

(d) If payments made do not relate to repair or damage to the jet-ski.

If you have an insurance policy and find yourself having to make a payment, then you should always obtain a police report if the police are involved in an incident. You should obtain a translation of any written materials, as such will inevitably be in Thai. Do not sign any statements unless you have consulted a lawyer. Consular assistance may be available for serious incidents.

You may find an additional claim has been lodged for ‘loss of earnings’ or ‘loss of use' of the jet-ski for other rentals during a period in which the jet-ski is under repair. Clearly if you were not informed of this possibility before using the jet-ski, a claim of this nature would be unfair, and also would not be covered by general or even special jet-ski insurance cover. Such claims should be resisted where possible.

"I used to have a BMX bike when I was eight years old; I'm now 35. I love the idea of super-fast motorbikes as I often watch the Super Bike channels on TV and can see how thrilling it must be for experienced, qualified, lifetime professionals to drive their motorbikes at breakneck speed around specially built racetracks. So I decided to have a few beers in Patong and then hire one of these bikes to drive around the coastal road to Laem Promthep in the fastest time possible, whilst filming myself with a HD camera.

When I hired the bike, I signed some kind of insurance document, or maybe a disclaimer, I can’t remember as the beer was quite strong. I then had to hand over my passport to the rental company, which I couldn't really understand as I'd already provided my credit card details to them.

Anyway, when I was overtaking a cement truck, I hit a modified bike with a sidecar and killed two stray dogs, which seemed to have been left to run free outside a restaurant. The Super Bike was completely wrecked. I was admitted to hospital with a broken collar bone and already have bills of more than 1,000,000 baht.

What kind of insurance issues might I face making a claim for replacement of the bike, my medical bills, the damages somebody I couldn’t understand seemed to be claiming for the death of two dogs (which I'm sure were only stray dogs) and loss of two months' earnings of the operator of the modified bike, who told me they sell papaya salad and grilled chicken every day near the taxi umbrellas next to the beach."

The first issue with the insurance of the rental company is that it most likely will cover only some minor damage to the motorbike.

If there is any indication that you were drinking alcohol and exceeded the legal limit, then all insurance will be ‘vitiated’ or deemed void, and you may be subject to criminal proceedings – through the public prosecutor, or privately by the rental company for criminal damage to property. Similarly, if you were found to be driving recklessly when you overtook the cement truck, you may be subject to criminal proceedings.

Should, for any reason, the matter be deemed a civil matter, then you'll be expected to meet with and negotiate with (a) the owners of the dogs and (b) the owner of the modified bike / papaya salad vendor.

You should take care to establish that the owners of the dogs truly are the owners, although this will be difficult in practice. You should also note that there are stipulated offences for owners of animals who allow animals in their care to wander on the road and be killed unnecessarily. If you damaged the street vendor's vehicle, then you may need to conduct some research on the daily income of that vendor, which will be difficult if you aren’t familiar with that business. You may well need to arrive at a settlement.

None of these costs are likely claimable against an insurance policy.

For your own medical costs, you may be able to claim provided you were not committing a criminal offence or are proven to have been intoxicated, or driving the motorbike illegally. The main issue that you may have is that you will be asked to produce a valid driving license for the bike. Being capable of renting a bike is not the same as being permitted to drive it.

When you're in the hospital, you may be asked to provide your passport as security for the bills of the hospital. This will prove difficult if your passport is with the operator of the bike rental business. Further, your passport is supposed to be retained by you and is not supposed to be used as guarantees by third parties, but often is in practice.

At a private hospital in Thailand, you'll be asked, or any persons attending the hospital with you will be asked, to show your insurance policy. The hospital will then communicate with the insurance company to establish that you are properly insured. The hospital will most likely demand payment in advance of any insurance company paying you, and you'll have to claim back the reimbursement from the insurance company.