How to find the right travel insurance policy

Thursday, 23 August 2012 04:55

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All across the country, Brits are busy packing their suitcases in readiness for their summer holidays – but while they are determined not to forget their passports, are they remembering their travel insurance?

Our helpful guide aims to take the mystery out of policies that protect you on your trips abroad.

What exactly is travel insurance?
Travel insurance offers financial protection against unexpected events during your holiday. These can range from illness and injury to cancellations and crime.

What does travel insurance cover?
Like most insurance policies, the cover varies depending on which provider you choose. Cover can also differ according to your holiday destination and duration, and who you are travelling with. That’s why it is essential to shop around to find the most suitable policy – and not necessarily the cheapest deal.

As a rule, comprehensive policies provide cover for medical treatment, theft, luggage loss, public liability and cancellation. There are often optional extras that you can add to your policy.

What type of cover will I need?
To start with, travel insurance can be divided into two main categories – single trip and annual/ multi trip. If you are only planning one holiday this year, the single cover should be sufficient. If you travel abroad at least twice each year, an annual or multi trip policy is more suitable as it will probably work out cheaper than buying several single trip policies over the year.

In addition, some insurance providers offer a choice of Europe or worldwide travel policies. Again, depending on any special offers, it may be cheaper to take just the European cover if you are not travelling any further than that – but do check that the countries you are visiting are defined as European by your insurer. It’s worth noting that multi trip insurance can sometimes have a limit on the length of each individual holiday. Very long trips such as gap years have their own special insurance (see below).

Does it matter who I’m travelling with?
It can often be more economical for families to take out one family travel insurance policy than a separate one for each parent and each child. In some policy deals, at least one child can go free so it’s always worth asking about family cover. Also, if you are travelling with friends for a hen party or 21st birthday party holiday, for example, ask about group travel policies as they may work out cheaper. Bear in mind, though, that if you are drunk on holiday when something unforeseen happens such as theft, you may not be covered by your travel insurance policy and this could even extend to losing your medical protection.

What should I look for in a travel insurance policy?

1. Medical cover
Bear in mind that once you have left Britain’s shores, the free treatment provided by the NHS will no longer apply and if you were unfortunate enough to be struck by illness or injury you could face a hefty medical bill from the country in which you are holidaying. Therefore, medical cover is one of the most crucial elements of travel insurance.

Travellers are often advised to opt for at least £2 million of medical cover on a European travel policy or at least £5 million for worldwide travel insurance. It sounds a lot, but in many countries including the USA and Canada a hospital bill can run into hundreds of thousands of pounds. It’s also worth ensuring that emergency repatriation is included in your policy – that means you can be brought back to Britain.

2. Pre-existing medical conditions
Even though it will probably raise your premiums a little, it’s always better to tell the insurer if you have a pre-existing medical condition. That way, there’s no risk of your policy being void, leaving you unable to claim. What is classed as a condition can vary, so check with your provider.

3. Lost luggage, cash and valuables
Again, this is an essential component of travel insurance and should cover replacement luggage and belongings if they are lost or stolen. Make sure the policy extends to protecting luggage while it’s in the care of an airline. There are usually limits on the amount you can claim for cash and valuables (again, this can vary from policy to policy) so try not to pack anything too expensive or irreplaceable for your trip.

4. Cancellation
It’s wiser to have your travel insurance cover start on the date of purchase, not the date on which you depart for your holiday. That way, you are covered for cancellation prior to the trip. In addition, a decent policy will normally compensate you if you have to cancel or cut short your holiday through illness or other serious events such as bereavement.

5. Personal liability
Even though it is not often used, personal liability cover is absolutely vital and will take care of any legal bills that might crop up if you accidentally injure someone or damage their property during your holiday.

What about winter sports and adventure holidays?
Special travel insurance is required for activities such as skiing, sledging and snowboarding, along with the pricey equipment used, as most general policies will exclude them.

And what about insurance for gap year travel?
Generic travel insurance will not be sufficient for most students and backpackers on gap year trips because they often spend more than a year travelling around from country to country. There are specialist policies for all ages and types of traveller and they vary depending on which countries are being visited, so it’s worth asking insurers for all their available options.

Does travel insurance have any age limits?
Some insurance providers will not cover holidaymakers aged 65 and above, because they believe that, statistically, older people are more likely to become ill. Other insurers simply charge more for older travellers. However, there are specialist policies available from insurers including Age UK, Saga and LV= but it’s essential to shop around to find the best deal for over 65s.

Any other tips?
Yes – make sure you are not already covered. You might, for example, have ‘away from home’ possessions cover included in your contents insurance, or some form of travel insurance as part of a credit card or current account package. But bear in mind they may only be very basic forms of cover, so check the policy details to ensure they are suitable for your holiday.

In addition, Brits travelling to countries in the European Economic Area (EEA) should carry a European Health Insurance Card (EHIC). People with a card can get state healthcare if they fall ill within the EEA – but this is by no means a substitute for travel insurance as it doesn’t automatically guarantee free medical care or repatriation costs, nor does it compensate you for lost luggage or cancellation.

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