10 things you need to know about travel insurance


Travel destinations signIf you're going away, don't forget to pack travel insurance. Tempting as it may be to cut holiday bills and forgo cover, it could prove a costly mistake if anything goes wrong while you are away.

Here, we look at 10 things everyone should know about travel insurance...

1. You should buy cover when you book your holiday

Many of us book our holidays and then buy travel insurance when we're about to leave, but you should take out cover as soon as you pay a deposit for your holiday. That way, if you have to cancel your trip for any reason, such as illness, you should be able to recoup the cost of the holiday.

2. Always shop around

If you have bought your holiday from a high street travel agent, the chances are they will try and persuade you to take out travel insurance at the same time. But the cover on offer is usually much more expensive than comparable policies. A comparison site is a great way to shop around and ensure you get the level of cover you need at the right price.

3. The EHIC is not a substitute for cover

The European Health Insurance Card (EHIC) entitles you to free or reduced-cost medical treatment when temporarily visiting a European Union country, Iceland, Liechtenstein, Norway or Switzerland. However, it will not pay for repatriation should you need to be transferred back to the UK, nor will it cover costs if the rest of your holiday has to be cancelled, so it should never be considered a substitute for insurance.

4. Annual multi-trip cover can be more cost-effective than single-trip policies

If you go away two or three times a year, it can be cheaper to opt for a multi-trip policy rather than taking out two or more separate policies. You also have peace of mind that if you suddenly decide to do an extra trip, you already have cover in place.

5. Annual policies won't necessarily cover children travelling alone

If you have taken out an annual travel insurance policy for all the family, don't assume your children will be covered if they travel without you. Independent financial research company Defaqto found only 50% of annual travel insurance policies will cover children named under the policy if they travel independently of their parents.

So, if you or your children are planning to travel independently, on a school trip, for example, it is essential to check the policy wording to ensure they are covered. If there is any doubt, speak to your provider.

6. Cheapest is not necessarily best

While finding a competitive quote is essential, you don't want to end up with policy that won't pay out in the event of a claim because it only provides minimal cover. Always check the cover limits carefully.

Comprehensive plans will provide at least £2m of cover for medical expenses, £1m for personal liability, £3,000 for cancellation - or enough to cover the total cost of your holiday, £1,500 for baggage and £250 for cash.

7. You must disclose medical conditions when buying cover

Travellers must ensure they disclose their medical conditions to insurers so they can confirm if their policy will cover any emergency treatment they may need abroad, or whether a tailored policy would be better suited to their needs. If you do travel abroad with a pre-existing medical condition and you haven't notified your insurer, this could invalidate your claim.

It is still possible to get travel insurance if you have a pre-existing condition. You will pay more but, as with standard insurance, prices vary so it's still worth shopping around.

8. Check for financial failure cover

The best policies will include financial failure cover, which will protect you against the insolvency of airlines and the other end suppliers of your trip. This is especially important if you haven't booked a package holiday.

Package holidays provide you with Air Travel Organisers Licence protection or similar, which will cover you if the tour operator goes out of business. But if you are booking directly with an airline, or are staying with friends or relatives while you are away, you won't have this protection, so insurance which includes it is vital.

9. Choose an affordable excess

When you buy travel cover, make sure you find out how much the excess - the portion of any insurance claim which you must pay yourself - is. For example, if you opt for a policy with a steep £250 excess, it's not going to be worth making a claim if your £200 camera is stolen, so opting for a lower £50 or £100 excess is more sensible. And with a family policy, check that the excess is for you all and does not apply per person.

10. Don't pay twice for cover

If you have a packaged bank account (also known as added value accounts), which you pay a monthly fee for, the chances are it may come with travel insurance, so you won't need to take out separate cover. However, always check the level of cover offered and whether the policy applies to Europe only or if it offers worldwide protection.


Last updated: about 5 hours ago