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Laos Insurance Scam

by Catherine from Canada

I crossed the border from Thailand to Laos at Chiang Khong March 1, 2003, to take the slow boat (2 days) to Luang Prabang.

In Chiang Khong, all of the guest houses sell tickets for the fast and slow boat down the Mae Nam Khong from Chiang Khong to Luang Prabang. The guest house you buy a ticket from will get you to the dock and take you across the river. Once on the Lao side, you check in with immigration. By this time, the people from the guest house, that you gave your money to, have gone back across the river to Thailand. Now you are in the hands of the Lao travel agencies who are in business with the guest houses, and they will ask to see your passport. It’s up to you whether or not you show it to them. Seeing as they are not government officials, they have no right to look at anyone’s passport.

You walk up the hill from the government dock. Then wait. Then you get on a songtow and go to an different pier. The Lao travel agency people will again ask for your passport. They will take it to the office at the pier and write down your name, country and passport number. Once again, it is up to you whether or not you give it to them. You can write out your information yourself if you want.

The travel agency people will now point you towards your boat, and you are now pretty much on your own. By this time it’s probably about 9:30 am. Some people on the boat will have been told that the boat leaves at 10am. Others were told 10:30. Whatever you were told, you’ll sit there for a while.

You will sit there long enough to experience the "Lao Insurance Scam". A guy comes on to the boat and tells you that it is a Lao government regulation that you must have insurance in order to take the boat trip. Everyone travels with travel health insurance. Everyone’s personal belongings are covered by their home contents insurance. So what could this insurance possibly cover? And if you did want to make a claim, do you think that you would ever be able to extract any money from this policy? Have you read the exclusions for the policy? Have you been to the office of the company selling the insurance? Does the company actually exist? Probably not. After all, you bought a piece of paper from a guy who came onto the boat.

In our case, things went OK. We argued with the guy for a bit and told him that of course we had the insurance, we just didn’t have the piece of paper with us. We also said that we had paid for the insurance when we bought our ticket. We also told other people on the boat about the scam so that they wouldn’t fall for it. For us, things went fine. Mostly people ignored they guy, and no one bought his "insurance".

We waited some more, and the boat finally left around 11:20 am. And it only took around 6 hours to get to Pak Beng.

There’s about 35 people on the boat, at 200 Baht each, that comes to about $170 US. A ton of money in Laos, where the monthly income is around $20-30 US. So of course this guy is going to be fairly convincing. There is a lot of money for him to make. The hook with this scam, is that the guy will tell you that the boat won’t leave until everyone has purchased his "insurance". If some people give in, then the guy uses this as emotional blackmail and leverage to try to get others to pay. As in "the boat won’t leave because of you. You are delaying everyone." "If you don’t pay, you have to get off the boat", says the insurance guy, even though he doesn’t run the boat. I even heard of one instance where one guy paid for everyone just to get the boat going. As far as I could tell, the boat schedule was similar to transport all over Southeast Asia. It leaves when it leaves. In any case, if no one pays for the insurance, the boat will still leave.

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