Travel insurance essentials

Sorting out travel insurance should be part of your holiday preparations.

We’ve all heard horror stories of people needing emergency medical treatment abroad and then being landed with bills of thousands of pounds to pay. Yet nearly one in four people still travel abroad without travel insurance, according to the Association of British Travel Agents.

Travel Insurance checklist

So do you really need travel insurance?

Last year 154,000  people claimed on their travel insurance for emergency medical treatment. The average claim was for £1,300 but some claims were much higher, running into the tens of thousands of pounds. On top of this there were 159,000 claims for cancelled holidays and numerous claims for lost and stolen luggage.

With the average annual travel insurance policy costing around £37 (less if you only need a single-trip policy), according to the Association of British Insurers, this makes travel insurance an essential for anyone travelling abroad.

What policy should you get?

This will depend on a number of factors such as:

  • Where you’re going. Some policies only cover Europe, others are worldwide excluding the US and others cover you worldwide. However, most policies will not cover you if you’re travelling to a country or region that the Foreign and Commonwealth Office has advised against.
  • How often you plan to go abroad. You can buy a single trip policy or an annual policy to cover you for several trips overseas.
  • How long you plan to be away for. Most policies cover trips of up to 90, 120 or 180 days. If you plan to be away for longer you’ll need a long-stay policy.
  • Who you’re going with – do you need travel insurance just for yourself or for your family?
  • Your age. If you’re over 65 you may need specialist travel insurance.
  • Your health. If you have a pre-existing medical condition you must tell your insurer for your policy to be valid. If you can’t get a standard policy you’ll have to take out specialist insurance.
  • The type of holiday you’re going on. If you are going backpacking or plan to do winter sports or  any ‘dangerous activities’, for example, you may need to take out specialist insurance.

What your policy should cover

Travel insurance policies can vary a lot but a good policy should include the following:

  • Medical expenses cover up to £1 million or more for travel to Europe and £2 million or more for travel to the USA.
  • Returning you home after medical treatment if you can’t use your original ticket.
  • Reasonable extra transport and accommodation costs if a close relative or friend needs to stay with you if you have a medical emergency.
  • 24-hour helpline you can call in an emergency.
  • Cancellation cover if you have to cancel or cut short you trip because, say, you fall ill or a close member of your family falls ill or dies.
  • Travel delay and disruption cover to pay for any extra accommodation and travel expenses you incur as a result of missing your flight, boat or train due to no fault of your own.
  • Baggage cover if your bags are lost, stolen, damaged or destroyed.
  • Personal liability and legal expenses cover if you accidentally injure someone or damage their property.

Other features a good policy should have include dental emergency cover, money cover and passport cover.

If you are going on any sort of activity holiday you will need a policy that provides cover for this.

Things to watch out for

  • Excesses – these vary between policies so look carefully at how much you are expected to pay and make sure there is only one excess per claim.
  • Length of stay; If you plan to go away for a long period of time such as more than 30 days on one trip, make sure you are covered for this.
  • Frequency of trips. If you plan to go away several times a year make sure any annual policy you buy will cover you for all your planned trips. For example, your policy may only cover you for up to 120 days abroad each year.
  • Receipts for baggage claims – some insurers require you to have receipts for all the items over a certain value that you lose. A good policy will not ask for this.

Travel insurance through your credit card or another insurance policy

If you have some travel insurance through your bank, a credit card, household contents insurance policy or private health insurance policy it’s worth looking closely at exactly what is covered as this often is insufficient.

For example, this type of insurance often only covers the most serious of medical emergencies such as the loss of a limb or an accident that leads to a permanent disability or death. So if you break a leg on the ski slopes, suffer from a bout of food poisoning or trip over and sprain your wrist, your doctor, hospital and repatriation costs may not be covered.

You may also have only limited cover for your luggage and you may not be entitled to any compensation if your transport is delayed or your holiday is cancelled.

Travelling in Europe

If you’re travelling within the European Economic Area (this is all countries in the EU plus Iceland, Liechtenstein, Norway) and Switzerland make sure you have a European Health Insurance card (EHIC) as this entitles you to the same level of state-provided healthcare as the people who live in the country you’re visiting.  Not all countries have the same level of healthcare as you’d get in the UK and they may charge but at least you’ll pay no more than the locals. Your insurer may also insist that you use your EHIC if you receive treatment in the EEA or Switzerland.

While it’s good to have an EHIC it’s no substitute for travel insurance as it may well not cover all your medical care costs and it won’t cover  the cost of getting you home if you need an air ambulance or to fly home early in an emergency.