Understanding The Terms "Effective Date" and "Look BackPeriod"


For some the plan's "effective date" is obvious, for others it causes confusion. But it's an important term because other parts of your policy refer to the "effective date" to define their coverage. The most important of these are the definitions of a "pre-existing medical condition" and the "look back period".

Somewhere in the plan wording you should find a definition of "Effective Date" or other wording defining when your coverage(s) begin and end. For example, this is from a TravelSafe plan:
 

"Your Term of Coverage:

For Trip Cancellation: Coverage begins on Your "Effective Date" which is at 12:01 a.m. on the date the appropriate cost for this policy for Your Trip is received and ends at the point and time of departure on Your Scheduled Departure Date.

For Travel Delay: Coverage is in force while en route to and from and during the Trip.

For all other coverages: All other benefits begin on 12:01 a.m. on Your Scheduled Departure Date. Coverage ends at the point and time of return on Your Scheduled Return Date."

 

In this case, the various coverages become effective on different dates which makes sense. If you get sick before you depart the insurer may pay for your trip cancellation but they certainly won't pay for your medical bills. Those would only be paid if you become sick after you begin your trip -- that's that benefit's "effective date.".

As you can see, the trip cancellation coverage is the only pre-departure insurance benefit of this plan and it ends as soon as you leave from home. Break your leg the night before you leave -- trip cancellation claim. Break your leg driving to the airport -- trip interruption claim.

A very common misunderstanding of this term is with the pre-existing medical condition exclusion and it's "look back period." Here's from that same TravelSafe plan:

 

"Pre-Existing Condition" means any injury, sickness or condition (including any condition from which death ensues) of You, Your Traveling Companion, or Your or Your Traveling Companion's Family Member traveling with You which within the 60 day period prior to the effective date of Your Trip Cancellation coverage under the Policy . . ."

 

Many will take that 60 day period prior to the Effective Date to mean the 60 day period prior to their departure. This completely skews the pre-existing condition definition. In looking at your trip cancellation claim and determining whether not an illness is "pre-existing"  the insurer will be focusing on the 60 days preceding your purchase of the policy, not on the 60 days period prior to your scheduled departure date or the 60 day period prior to your cancellation date.

With this particular policy "Effective Date" is also used in reference to many other coverages. For example:

""Sickness" means an illness or disease that is diagnosed or treated by a Legally Qualified Physician after the effective date of insurance and while You are covered under the Policy. "

"a) You or Your Traveling Companion being hijacked, quarantined, required to serve on a jury (notice of jury duty must be received after Your Effective Date) . . ."

"n) Bankruptcy or Default of an airline, cruise line, tour operator or travel supplier (other than the tour operator or travel agency from whom You purchased Your Travel Arrangements) causing a complete cessation of travel services more than 14 days following Your Effective Date."

"t) a cancellation of Your Trip within 24 hours of Your Scheduled Departure Date and time if Your Trip destination is under a hurricane warning issued by the NOAA National Hurricane Center, provided the cancellation of Your Trip occurs more than 15 days following Your Effective Date of coverage for the Trip Cancellation Benefits; "

"evidence of continuous cohabitation throughout the 180 day period prior to Your Effective Date of the Plan"

"an employed caregiver who lives with You, or a person for whom You are the primary caregiver with whom You have lived for 12 continuous months prior to the effective date of Your Plan"

So be sure to understand when each of the coverages become effective for every plan you're looking at --this will be different for each plan so be sure to check every time.

Here's one example of how the "look back period" and "effective date" can mean two very different things depending on what plan benefit you're looking at. Here's the definition of a "pre-existing condition" from one plan:

".Pre-existing Condition means an illness, disease, or other condition during the 60 day period immediately prior to your effective date for which you . . .  "

 

And here's their definition of "effective date":


"When Coverage Begins

All coverages (except Pre-Departure Trip Cancellation and Post-Departure Trip Interruption) will take effect on the later of 1) the date the plan payment and enrollment form has been received; 2) the date and time you start your Covered Trip; or 3) 12:01 A.M. Standard Time on the Scheduled Departure Date of your Covered Trip.
 

Pre-Departure Trip Cancellation coverage will take effect at 12:01 A.M. Standard Time on the day after the date your plan payment and enrollment form is received. Post-Departure Trip Interruption coverage will take effect on the Scheduled Departure Date of your Covered Trip if the required plan payment and any necessary enrollment forms is received. "


30 days before you depart on your tour you catch pneumonia. Is it a "pre-existing condition"?

For the trip cancellation coverage it is not. The condition did not exist in the 60 day period prior to the effective date of that coverage. So if you need to cancel your trip you'd be covered.

For the trip interruption and medical coverages, YES it is a "pre-existing medical condition" as you got sick inside the 60 day period prior to your trip departure -- that coverage's "effective date." So if it re-occurs during your trip and you need to cut the trip short or need medical attention during the trip you're not covered.

 

travel insurance basics