Travel Insurance Explained
Setting off on a holiday is an exciting time, whether in winter or summer. There are the days of anticipation - getting everything organised, squeezing the last of your clothes into an over-packed suitcase - then the tension of getting to the airport on time, until finally the plane takes off and you allow your body and mind to relax.
But did you remember travel insurance?
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There are actually a surprising number of situations that are covered by travel insurance, but some of the most important ones that float to the top are medical cover, holiday cancellations, and belongings.
Does travel insurance cover medical expenses?
Most of us have grown up with the NHS and never turn our minds to the fact that doctors and hospitals incur a cost that must be paid for. Once you step out of the UK, you are subject to the health system of the new country and some of those have extensive costs. While a European Health Insurance Card (EHIC) gives you minimal cover across the EU, it is considerably less effective than comprehensive travel insurance and should not be considered a substitute.
In all cases, and especially if you are travelling with children, you should be sure to have travel insurance to cover medical needs alone – you cannot be sure something won’t happen while on holiday and in some countries, America for example, you can suddenly find yourself faced with a bill for tens of thousands of pounds!
In all cases, and especially if you are travelling with children, you should be sure to have travel insurance to cover medical needs alone – you cannot be sure something won’t happen while on holiday and in some countries, such as America, you can suddenly find yourself faced with a medical bill for tens of thousands of pounds!
It is generally recommended that you look for a minimum of £1,000,000 worth of cover, which should include repatriation to cover you should you need to be flown back to the UK.
Of course, you should always take into consideration where you’re travelling to – you will probably need more medical cover if you are going to somewhere like America in comparison to a country in the EU.
Skip to: The Cost of Travel Insurance
Does travel insurance cover holiday cancellations and curtailment?
Sometimes, even the best plans don't follow expectations and you're left with no option but to cancel your holiday altogether.
If you find yourself in the horrible position of having to cancel your holiday, either before the event or curtailing it (cutting it short) once you are there, the best travel insurance policies will reimburse you for the cost of your holiday.
It's easy to think that it won't happen to you, but a family member falling ill or a significant problem at work could unexpectedly put an end to an expensive trip and recovering the costs of that can be stressful, if not impossible, for many without a travel insurance policy in place.
For this reason, it is recommended that you cover the full cost of your holiday, because you never know what travel problems could arise.
Personal belongings travel insurance
We’ve all heard the unfortunate tales of suitcases that find their way to Iceland instead of Ibiza. Eventually it usually ends up in its correct destination, but what if your luggage genuinely goes missing or is stolen? Covering your personal possessions with travel cover will help you have a relaxed trip, as you will be able to rest easy knowing that the cost of any belongings that are lost or stolen during your holiday will be recovered.
Most policies are relatively low value and will only cover typical things you take on holiday, excluding more expensive items that you have not specifically declared. If you have to take high value items with you (jewellery, expensive equipment etc.) then you will need to contact your insurer to add those specific items on, often at an additional cost dependant on the value of the item.
The travel insurance single-item limit is often no higher than £300.
Insurers do expect you to do what you can to mitigate the risks, so keep in mind that they might not pay out under some circumstances. If you leave a bag or suitcase unattended in a public place or leave hotel rooms open, for example, they have the right to refuse the claim. Be sure to take reasonable care of your items.
The cost of travel insurance depends on a wide range of factors, including the type of policy you opt for (single or multi-trip), the country you’re going to, how long the trip will last, your age, and any additional cover that you require.
For instance, a young adult in their mid-20s visiting Spain for a few nights could get cover for as little as £5 or £6, while an older, retired couple travelling around the world could face premiums that amount to ten times that amount.
Here’s a quick list of the factors that affect the price of travel insurance in the UK:
- Your age (cover generally gets more expensive as you age)
- Any activities you have planned (dangerous activities could increase the cost)
- The level of cover you require
- Where you’re travelling
- The duration of your trip (longer holidays tend to be more expensive)
- Any existing medical conditions (these are likely to increase your premiums)
If you’re looking to have three or more separate holidays in a year, then it almost always works out more economic to take out a multi-trip policy rather than a single one.
According to a study carried out by MoneySuperMarket, those aged between 66 and 70 pay an average of £28.31 for a single trip travel insurance policy, while those aged between 26 and 30 pay an average of £11.22 for the equivalent cover.
The cheapest age category to cover, according to MSM’s study, is 18 to 25 year olds, who pay £9.97 on average.
Like all insurance policies, travel cover comes with an excess – the amount you are expected to pay towards any claim. If you wish to claim for something worth £250, and your excess is £75, then the amount you can expect from the insurance company is £175.
Unlike other standard insurance policies, such as your car or home insurance, travel insurance often has different excesses for different items under the policy and you must cover each one separately.
For example, you may have travel insurance covering both medical needs and cancellation, with an excess of £100 on the first, and £150 on the second. If you are sick, have some treatment and then return home early as a result and wish to claim for both the medial expenses (£1200) and the curtailment of £1500, you will have to pay you excess on both. After paying this you will only receive £1100 regarding the medical costs and £1400 for curtailment - meaning your costs are a total of £250.
Voluntarily increasing your excess should lower the cost of your travel insurance, but be sure to set it at a realistic level - you don't want to make it so high that there's no point claiming on the insurance should anything happen! Your travel insurance excess should be an amount that you can comfortably pay if ever you need to make a claim on your policy.
The right destination: Worldwide and European travel insurance
Travel insurance from the UK usually takes the form of Europe-only or Worldwide cover. It's important that you take out a type of insurance policy that covers you for all the countries you plan to visit, as you will not be able to make a claim if you mistakenly purchase Europe-only insurance but travel to America, for example.
It's always worth checking with your provider, as many Europe-only travel insurance policies stretch to include border countries, such as Egypt or Turkey - you may get lucky and be able to save significantly.
Travel insurance for frequent travellers
If you are only going on one holiday a year, single-trip insurance is probably the best option for you – a one-off insurance policy tailored to that particular trip.
However, for those who travel regularly, opting for an annual multi-trip policy could be the right way to go. For most people who take three or more trips a year, this is considerably cheaper than multiple single trip policies.
For those who are planning a multi-country extended trip, such as a gap year of travelling, you may need backpackers’ travel insurance, as standard travel insurance is unlikely to provide cover beyond a month.
What travel insurance extras do you need?
In general, most of the best travel insurance policies will automatically cover possessions, medical treatment, holiday disruptions, and legal costs. But there are some optional extras that you may need to add at an additional price to cover all eventualities.
Some things that may not be covered within the standard cost include:
- Adventurous or dangerous activities (including extreme sports)
- Expensive possessions (gadgets, jewellery and equipment)
- Labour-induced injuries (if you’re injured doing a temporary job while backpacking)
Be careful of exclusions within your travel insurance policy, as it’s common that some (if not all) of the following could warrant a pay-out refusal:
- Theft or damage to unattended belongings
- Undeclared pre-existing medical conditions
- Extreme sports (skiing, white-water rafting, rock climbing, etc.)
- Injury caused by recklessness or drug/alcohol abuse
- If you travel despite the government advising against it*
*This includes terror attacks and natural disasters leading to the local government advising against travelling to that location.
There are usually optional add-ons that can cover most things, but the more high-risk they are, the more expensive it will be.
Some of the best travel insurance providers in the UK include:
- Post Office
- Insure and Go
- Legal & General
By using comparison sites like Confused.com, you can a wide range of seequotes from these providers (and many more) and you will be able to select the best deal for your personal situation.
To get your free travel insurance quote today, simply tap the button below!