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Tuesday, 5 February 2019

Travel insurance – choose the right policy and cover

There are hundreds of travel insurance policies available, so before you buy you need to know what type of policy you want, and what you want it to cover you for.

What type of policy do you need?
Essential cover
Cover for airline or hotel failures
What about cover for unexpected events?
Next steps
What type of policy do you need?
Who is going?
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Having travel insurance is a very good idea. Protect yourself properly by researching all your options rather than just choosing the cheapest.

If you’re travelling with your family or friends, you can choose from one of these options:

Single-parent family cover
Couple travel insurance – if you live at the same address as your partner
Family holiday insurance – for two adults plus up to four children travelling together – this will suit you if your children are 18 or younger and live full-time with you
Couple and child cover – often cheaper than a family policy if you have only one child
Watch out for:

A ‘family’ policy can be invalid if family members are travelling independently or if the children are travelling with someone not named on the policy
A ‘family’ policy might not include children or step children who do not permanently live with the policy holder
Where are you going?
Policies are often set by area, normally:

Europe
Worldwide excluding the US
Worldwide
Watch out for:

‘Europe’ in travel insurance terms is different to what is technically Europe so you need to check that where you’re going counts as Europe for your travel insurance company. For example, Switzerland is not part of the EU but is part of Europe.
Make sure you’re covered for day trips over national boundaries – for example, Greece into Turkey, Gibraltar over to Morocco, or the USA into Mexico if your policy is based in one specific country.
If you visit a country – or part of a country – after the Foreign and Commonwealth Office has warned against travelling there your travel insurance will be invalid.
How often do you travel?
If you travel abroad more than twice a year, annual holiday insurance or multi-trip insurance is usually better value.

You also have the benefit of being able to take trips at short notice without having to arrange insurance.

How long is your trip?
Most annual and single trip policies cover you for 90, 120 or even 180 days. If you’ll be away for longer, a long-stay policy provides up to 18 months of cover.

Are you backpacking or on a gap year?
First, look for specialist gap year insurance or backpacker insurance.

Then, add on cover for the kinds of activities you’ll be doing – whether it’s adventure sports, work or volunteering.

For unplanned activities such as bungee jumping or pony trekking, you might need to contact your insurance company while you’re away to arrange cover.

It’s also a good idea to look for insurance that can be extended, should you decide to stay on longer than you originally planned.

Are you doing any sports or activities?
There are plenty of policies that cover winter sports, including injury and piste closure.

If you’re planning on doing anything adventurous, you’ll need extra cover.

The ‘adventure sports’ clause covers some of the obvious activities like, bungee jumping and scuba diving, but insurers also count less obvious activities as ‘adventurous’, including horse riding, mountain biking, canoeing and motorcycling.

Do you need a specialist policy?
If you’re over 65 or have a medical condition, you’re likely to need a specialist policy.

Read our guide on Travel insurance for over 65s and medical conditions.
Essential cover
Full medical cover
To make sure you have the cover you need your policy should include:

£1 million of cover for medical expenses in Europe
£2 million in medical cover for areas outside Europe
A 24-hour helpline that lets you phone your insurance company in an emergency
Check what’s included in a medical emergency – it should cover your treatment, plus accommodation and travel expenses for you and someone to stay with you and accompany you home.

Baggage and belongings cover
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£3,000 – the value of belongings the average family takes on holiday.

Source: Association of British Insurers

Most policies include between £1,500 and £3,000 of cover for lost or stolen possessions.

However, excesses can be high and the limits you can claim for valuables are often quite low.

Insurers also have different definitions of ‘valuables’ so you need to check whether you’re covered for any expensive items you’re taking.

There is a maximum amount – called the ‘single article limit’ – that will be covered for each individual article.

There’s also a limit on the total amount that can be claimed for items listed as valuables.

If you have very expensive jewellery or a laptop, camera, or camcorder, the single article limit for your policy is unlikely to be high enough for your needs.

You could also check your home contents insurance policy to see if you have sufficient cover for items taken outside the home.

This is usually an added option on your policy.

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More than eight out of ten people don’t realise that valuables are only covered if you keep them in your hand baggage while travelling.

Source: Association of British Insurers

The ‘total valuables limit’ applies regardless of the single article limit.

For example, if you have a camera worth £300 and a camcorder worth £200, but there is a total limit of £300.

In the event that both are stolen the most you would be able to claim back is £300.

If you’re not taking much of value with you, you can often choose not to have this option, which makes your policy cheaper.

Or you can rely on your home insurance if this cover is already included.

Cancellation cover
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If you’re delayed for a long time, or your flight is cancelled, your first port of call should be to contact your airline or travel agent.

Make sure your policy will offer you enough to cover your costs if you need to:

Cancel your trip
Come home early, for example, should a close relative fall ill
Your insurers will only pay out if you cancel for a few very specific reasons.

These normally include:

A‘close relative’ falls ill
You are quarantined
You are made redundant
You or a travelling companion get sick
You are called up for jury service or are called as a witness
You work for a government department and your leave is cancelled
You are prevented from travelling due to an epidemic where you’re travelling
You are requested to stay at home or return from your holiday by the police
Cover ranges from £250–£20,000, so check it’s enough for you. Bear in mind that cancellation cover is per person.

So for example if your family holiday cost £3,000, then you only need £1,500 of cancellation cover each.

Watch out for:

A close relative is usually defined as children, mother/father, brother/sister, brother-in-law and sister-in-law, grandparents – but not usually aunts and uncles or cousins.
Even if a close relative falls ill, you won’t normally be covered if they had a pre-existing medical condition that they were undergoing tests for, or receiving treatment before you took out the insurance.
Personal liability cover
Most policies will provide at least £1 million in personal liability cover in case you’re sued for damaging property or injuring someone.

Cover for airline or hotel failures
If you book a package holiday
Before booking, make sure your travel agent is registered with Air Travel Organisers’ Licensing (ATOL) and that your package has ATOL protection.

This means you will get a full refund – or the chance to finish your holiday and come home – if your hotel, airline or tour operator goes bust.

Standard holiday cover excludes bankruptcies of any party that provided the travel or holiday.

If you book your own travel
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If you pay for flights or excursions with your credit card you’ll be able to get a refund from your credit card company if a provider goes bust as long as the transaction is more than £100.

If you’re booking your own travel requirements and your policy does not already include them as standard then you can often add on:

Disruption due to atmospheric conditions such as volcanic ash clouds
Scheduled airline failure insurance – pays out if your airline goes bust
Holiday failure insurance – covers the failure of your safari, cruise or excursion provider
Independent traveller cover – usually covers all trip costs such as accommodation, pre‑booked transfers and repatriation
Learn more about how you’re protected when you pay by card.
What about cover for unexpected events?
Cover against strikes and civil unrest isn’t included in most policies, though it’s becoming increasingly relevant for travellers.

Find out which insurers offer the best value on unexpected events cover on the Which? websiteopens in new window.
Next steps

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