Money tips #38-54 – Seventeen tips to ensure you have the best travel insurance policy
Choosing the best travel insurance policy is a difficult task but if you follow the advice below then your travel insurance won't leave you out of pocket or high and dry should the worst happen.
1. Book your travel insurance as soon as you book your trip - if you don’t then you won’t be covered if you are forced to cancel your trip. In addition, if it looks like your holiday could be potentially cancelled, due to an ongoing issue outside of your control such as volcanoes erupting (as is the current problem) or planned strike action, and you don’t have cover in place beforehand then you will unlikely be able to secure any which protects you from the looming problem. For example, in the case of strike action, often the small print contains a clause which states you will not be covered if the potential for strike action has been announced prior to you securing your travel insurance.
2. Check your policy has Scheduled Airline Failure (SAF) included - According to moneysupermarket only ‘10 per cent of travel insurers include it in their policies though some do offer it for an additional charge’. SAF protects you if the airline you are travelling with goes bust. Standard travel insurance will not always cover you.
3. Shop around – there are plenty of companies competing for your money so make sure you secure the best level of cover for your budget (click here) but……
4. Cheapest does not mean best– if a policy is cheap the chances are the level of cover will be low and there may be exclusions. Comprehensive and sufficient cover is more important than cost. Compare the benefits on a cheap deal to a more expensive one and you will see what you’re giving up. It may be that the cheaper policy provides sufficient cover anyway.
5. Make sure the level of cover is sufficient but not excessive – this is may seem obvious but many people often fall foul of the fact that the value of the possessions that they take with them may not be fully covered ie. jewellery. You might be better off leaving that expensive engagement ring at home. Also, make sure you have sufficient cover for any cash/currency that your plan to take – and pay attentions to the levels of medical expenses, legal fees, personal liability insurance, personal accident cover that are included. At the end of the day there is no need paying for more cover than you need.
6. Watch out for the level of excess – make sure you are happy with the excess you will be asked to pay should you have to make a claim. Cheaper policies may have higher excess levels and there is no point in taking out a policy which requires you to pay an excess which is greater than the value of your luggage should it become lost or stolen.
7. Consider annual travel insurance - If you plan to make 2-3 trips in a year taking out a annual policy will likely be cheaper. In addition, these policies will cover you for weekends away in this country. So if you lose something on a weekend trip to Cornwall you may be able to claim on your travel insurance policy - as the chances are your home insurance won’t cover it unless you have elected to have cover for loss outside of the home, at an additional cost.
8. Check excluded countries on worldwide cover - If you are booking annual worldwide travel insurance make sure you are fully aware of the countries that are excluded from your policy (as there will be some). Worldwide doesn't mean worldwide!
9. Check what the insurer classes as hazardous activities (even if you don’t plan on doing any) – obviously if you plan on going diving etc then you need to make sure you are covered. However, other activities may be classed as hazardous even if you don’t think they are, such as taking a light aircraft connection while on safari. So consider what you will probably get up to on holiday and make sure you’re covered.
10. Use a specialist insurer if you're over 65 - While you may have the time and money to enjoy some foreign sun the bad news is that when you are over 65 travel insurance premiums usually soar and lots of insurers will only offer single-trip policies. But there are specialist companies out there so don’t be disheartened. Click here to see moneysupermarkets comparison tool for the over 65’s.
11. Consider the area you are going to - What is the weather likely to be like? Is there any danger of hurricanes etc? How about Mosquito borne disease? What is the crime rate like? Whatever the perceived dangers make sure that your travel insurance covers you for that eventuality.
12. Consider a family or joint policy if you are not travelling alone – this will likely cut the cost of the insurance but make sure all party members are included as some policies have limits on the number of people covered or exclude certain relatives. Apparently 1 in 3 policies do not cover children who do not live with the policy holder. So separated parents need to be careful.
13. Check whether the insurance will require you to pay for medical or other bills upfront and then reimburse you, or whether the policy will kick in immediately – there is no industry standard so be sure to know what you are letting yourself in for.
14. Don’t just use the free insurance offered by your bank (or indeed the one offered by the travel company) – Which? Magazine research has shown this to be of particularly poor value for money, but more importantly they might not provide the cover you need for your set of circumstances.
15. Check any pre-existing medical conditions are covered – if the insurer doesn’t cover them as standard then they may do so if requested but your premium will be increased - so shop around . Having said that you may be happy for any pre-existing medical condition not to be covered if you are only just going for a weekend trip - so keeping costs down.
16. Ask stupid questions – it’s always good to speak to someone before you part with your cash. If you are unclear as to whether you will be covered if you lose your wallet while sky diving into a volcano from a hot air balloon then ask.
17. Read the small print and note down any exclusions – this is one time when you need to read the small print. It is unlikely that a policy will cover you for everything, or at least not without being hideously expensive, so there will be exclusions. Just make sure that you are happy with any that are present in your policy. For example are you covered for acts of terrorism or if you have to cancel your holiday due to illness, pregnancy (unknown when you buy the policy – but this could be important if you are trying for a family and have bought an annual policy), a home emergency (such as a flood or burglary) or redundancy. If you make a claim will they refund the full cost of the holiday, pre-paid excursions or car-hire? Will they repatriate you in the event of a medical emergency? There are plenty of other examples. Here is an interesting article from the Guardian which I recommend you read When travel insurance exclusions leave you in a jam.
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