What would you do if you went abroad and needed medical treatment? Say you have booked a holiday in the UK and have to cancel it due to you being hospitalised or a family member being made redundant.
What would you do should the airline you are going to fly with go bust and you are then unable to reach your holiday destination? Should you not have the correct insurance in place, your dream holiday may become your ultimate nightmare, with you facing bills amounting to many thousands of pounds. Should you have to be brought back to the UK, for example, from the States the air ambulance alone can cost around £45,000.
Upon deciding that you do need travel insurance, you then need to make sure that you buy the best kind of cover for specific needs. This will be dependent on the kind of travel you are going to undertake and the cheapest policy may not be the most appropriate for you.
Reading our travel insurance guide will enable you to decide the cover level you need to be looking for so that you are totally prepared for that dream holiday.
The basics of travel insurance
Travel insurance premiums differ a lot. It is of course vital for you to obtain good value for money as it is to select the policy that meets your needs. You can add extras, however, a basic policy needs to include these cover levels:
Cancellation and curtailment
This level of cover provides you with protection should you have to cancel or cut short your holiday due to perhaps job loss or you not being able to afford your trip or if a relative becomes ill when you are away and have to return early.
The limit that is recommended is £3,000, or your total holiday cost. Usually travel insurers pay out when family members become ill whilst you are on holiday and you have to return early. Read the small print carefully and you will find that usually insurance companies do not pay out if you have returned early due to a friend becoming ill.
Delay
You ought to be compensated should your flight be delayed for more than 12 hours. To prevent any problems occurring regarding compensation ask the airline to confirm the delay in writing and retain any receipts of what you have had to buy as a result of the delay.
Baggage and belongings
Your travel insurance policy ought to pay out up to £1,500 should your luggage or personal possessions get lost, damaged or stolen. Most travel insurance companies place a limit on the pay out for individual valuable items, like laptops and cameras. The limits vary between insurance companies, yet are usually £250 or £500. Should any of your cash be stolen whilst you are on holiday, the pay out is normally limited to £250 or £500.
Personal liability
Should you end up injuring someone or damage someone’s property, they can make a claim against you. Hence, it is sensible to have personal liability cover up to £1m.
Emergency assistance
Most insurance companies provide a 24-hour emergency helpline which can prove invaluable especially given when you are in a different time zone.
Medical cover
Medical cover is essential if you become ill or have an accident while on holiday. The majority of experts recommend £2m of medical cover when you travel overseas. This cover ought to include repatriation if you have to be flown back to the UK.
Certain policies offer generous limits. However, you need to question yourself as to whether or not the cover is actually necessary. Otherwise, you may be paying over the odds for insurance you do not need.
Pregnancy ought not to prevent you going on a holiday. You will need to check your policy terms and conditions. The majority of travel insurance companies do insure pregnant women, however, normally for up to around 24 weeks. You are likely to be covered in the event you find out that you are pregnant whilst on holiday and therefore need to curtail your break.
What happens should I have a pre-existing medical condition?
A standard travel insurance policy does not cover pre-existing medical conditions. So say you already have asthma and suffer an attack when holidaying that necessitates medical treatment, your policy is not going to pay out.
It is crucial that you declare any existing health issues on application for travel insurance as failure to disclose any relevant details might invalidate the policy.
Certain specialist policies do cover pre-existing conditions; the higher the risk of a claim the higher premium.
The advantages and disadvantages of a Global Health Insurance card
Should you be going to Europe, you may apply for a Global Health Insurance Card (GHIC). This entitles you to medical treatment in state run hospitals within the EU.
The GHIC can prove useful in an emergency. However, it does not act as a substitute for insurance. GHIC holders pay the same amount for treatment as a local would. Hence, if the treatment is free for the country's residents, you are not going to need to pay nothing. On the other hand, should the locals pay towards healthcare, you are going to have to pay up.
The card does not cover repatriation costs because the card does not cover the cost of a return flight home should you become ill or have an accident when on holiday.
You can apply for the GHIC online and it is of note that it is free.
If you need medical care, use this card, most travel insurers do waive the excess. You can also contact the NHS Overseas Healthcare Services team on 0191 218 1999 from the UK or +44 191 218 1999 if you're abroad.
How does the excess work on a travel insurance policy?
It is vital to grasp how the 'excess' functions on a travel insurance policy in order that you do not get stung. The policy holder pays a set sum, an excess, towards a claim. Therefore, on a claim for £1,000, with a policy excess of £100, the insurance company will pay out £900. Certain policies charge an excess per section, so the costs can rapidly mount up.
Some insurance policies charge only one excess per claim, which can prove to be cheaper.
Do I have to take out worldwide cover?
The majority of insurers provide European or worldwide cover. It is vital that you check that you are insured to travel to your destination. Overall, Europe-only policies tend to be cheaper than worldwide cover and usually include countries on European boundaries, such as, Morocco, Egypt and Turkey. Should you be travelling to America or Canada, ensure the country is included on your worldwide policy; you may need to take out specialist insurance to cover the country.
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Travel insurance to annual trips or single trips?
You can purchase travel insurance each time you go on holiday, or you can choose annual multi trip travel insurance, which normally covers any number of trips over a year.
Should you be a seasoned traveller or you are considering a long haul vacation, an annual policy usually works out cheaper. Should you make two or more trips per year, or be going to a far away destination, you can save money on your travel insurance if you opt for an annual rather than a single trip policy.
Overall levels of cover, especially for medical expenses, baggage and cancellation are more generous on an annual policy. So if you are a frequent traveller you can be make last-minute trips without any concerns about insurance.
Backpackers insurance
Insurers normally place a limit on the duration of your holiday. Should you purchase a single trip policy, you are normally covered for a trip lasting up to 31 days. Certain companies insure lengthier holidays as standard, however, read the small print with care. Should you be planning an extended trip, like a gap year, you are able to purchase backpackers travel insurance, often referred to as long stay or gap year travel insurance. This is normally valid for between three and 18 months and covers a trip across various countries.
Family travel insurance
It is usually cheaper to purchase a family policy should you be travelling with your children. Moreover, certain insurers offer free cover for younger children. However, scour the excess terms on a family policy. Certain companies charge an excess for each family member. Therefore, say a family of four was forced to cancel a trip, that family would be stung for four excesses.
Winter sports travel insurance
Make sure you check for exclusions with regard to your travel insurance policy in order that you do not receive a horrible surprise when you make a claim. The majority of insurers exclude risky activities, such as, scuba diving and horse riding.
Therefore, should you be planning an adventurous holiday, you are able sometimes to take out extra cover for risky activities and you may opt for a specialist policy.
Winter sports insurance, for example, is designed for skiers and snowboarders, usually covering expensive equipment and ski passes. Nonetheless, you need to scrutinise the small print.
Adventure travel insurance
Adventure travel insurance is like winter sports insurance and provides cover for the more courageous travellers who wish to indulge themselves in activities like bungee jumping and white water rafting. The premiums herein are usually higher than for standard cover due to the higher risk of claims. However, it is worth having peace of mind.
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Travel insurance for older travellers
Older people usually experience difficulties to arrange travel cover, even if they are fit and active. Certain companies will not insure anyone aged over 65; whereas, others charge extremely high premiums. The cost of cover doubles once you reach 65.
Statistically, older travellers are more likely to make a claim on their travel insurance. However, certain specialist firms cater for older travellers. The policies usually include cover for several pre-existing medical conditions and have higher limits, especially for medical claims.
Business travel insurance
It is vital if you are flying away on a business trip to make sure you have adequate insurance. Your standard policies occasionally include business travel, yet there are usually restrictions, often for manual labour. You may be better off with a specialist business travel policy which includes every kind of work overseas, plus cover for office equipment like laptops.
Cover when a disaster happens
The majority of companies do not provide cover for natural disasters or airline collapse. Many firms do cover against ash clouds, post 2010 volcano eruption in Iceland which caused travel chaos.
Certain insurers provide cover for terrorism, riots and civil unrest. Be sure to read the small print with care. Should the Foreign & Commonwealth office advise against travel to a specific country or region, the insurance is most likely not to pay out.
There is an increasing number of policyholders who are demanding cover if a travel company goes under in these financially trying times. Should you book a package holiday via a licensed tour operator, you are usually covered by the Civil Aviation Authority ATOL protection scheme. There are many people who book flights on the internet and then look for scheduled airline failure insurance and end supplier failure accommodation. So most policies provide scheduled airline failure insurance and end supplier failure. So, you have protection should the airline, ferry firm or villa company go bust upon you booking a holiday.
Cover for strikes is an additional add-on as it insures the policyholder if his or her holiday is delayed or cancelled due to industrial action.
Have you already got travel insurance cover?
Should you be considering purchasing travel insurance, you need to check any existing cover. Your home contents policy may include insurance for your personal possessions when you are not at home. You may also already have travel insurance cover on your bank account or credit card.
However, check the benefit levels as ‘free cover’ is extremely basic. Usually free travel accident insurance covers serious injury caused in an accident. It will not pay out should the policyholder require medical treatment if he or she becomes ill, loses baggage or the holiday is cancelled or cut short.
Essential travel tips
- Look after your belongings when on holiday. If you have left your luggage unattended, the insurance company can legitimately refuse a claim for theft. Most insurers request a police report relating to any crime.
- Do not leave getting travel money till the last minute as you may be left short changed; the Bureau De Change at airports normally leaves you in such a situation. Pre paid cards enable you to avoid such a situation.
- Check your passport and visa deadlines. Prior to travelling ensure that you have a valid passport for six months after the date you intend to return to the UK. Check that the destinations you wish to travel to require a visa and get the visa wherever necessary.