A comprehensive guide to everything important about travel insurance

Travel insurance cover might seem like an unnecessary expense, particularly to those who often travel without it. The justification is often along the lines of “What are the chances that anything will go wrong?”

It is true that most travellers will probably have an uneventful trip, but if you happen to fall into the minority that may happen to fall ill or seriously injured enough to need an emergency evacuation (which could cost in excess of $100,000), then you will be glad you chose a travel insurance policy that provides sufficient cover.

Choosing travel insurance cover is a lot of work. The extensive options available – coupled with the minor details that could invalidate any claim – can make the average traveller feel uncertain about whether they have chosen a cover that is comprehensive enough. Make sure you research properly before making an informed decision. Find out everything you need to know about choosing travel insurance in the following guide.

Travel Insurance policy providers

There is a growing number of travel insurance policy providers, with each vying for attention in a crowded market. Making a choice of travel insurance company to go with is dependent on numerous factors. It might seem like all travel insurance providers offer the same product, but you need to consider a few important things when weighing up your options.

Price: This is at the top of most traveller’s lists when looking for insurance. You need to understand that while there are certain advantages to finding cheap cover, your choice of provider should never be based on price alone. It might be tempting to use price comparison sites to find the cheapest insurance cover, but the truth is that you cannot really be sure of how your insurers will perform once they have received your payment. So, look out for competitive price for the insurance cover that you want. It is also important to research other factors, such as the number of days abroad for which you are covered when you choose an annual cover, and cover for extra sports activities such as golf, or extreme sports.
Insurance pay out limits: This is an indicator of how well your insurance company performs. Finding out what the insurance pay-out limits are, means that you know exactly what you are likely to receive in the event of you having to make a claim. Keep in mind that some companies offer higher limits at lower premiums.
Customer Service: You need to research the company’s reputation and the quality of their customer service. Being in an emergency abroad, you will want a company like State travel insurance that will act promptly to resolve your issues. If paying extra money means that you get a better service, then it is worth the extra you had to pay in premium. Be sure to find out if your company has a 24-hour line that you can call for any overseas emergency.
Claim process: Some companies make the claim process unnecessarily difficult and drawn-out. Look out for those companies. If you find that people complain about how long it took to process their claim, or have to jump through too many hoops to get their claim approved, then that is an indicator that they are not the right company for you.

Choosing a company should not be a blind exercise. Proper research should go into making a choice, so that you are not left dangling on a string when you need your insurance claim to come through for you.

Main Sections of cover

Travel insurance has many features – and a basic understanding of each component will guide you towards making the right decisions. Many travel insurance providers offer several areas of cover; some are basic and others additional. However, the most important aspects of cover to choose and review repeatedly in the fine print and coverage description, include the following:

Medical Emergencies and Medical Evacuation

This is probably the single most important reason why anyone should have insurance cover. The health costs both at home and abroad, without insurance cover, can be enormous. Having sufficient coverage takes away any anxiety if something does happen. A great medical cover will be one that provides insurance for medical expenses with a high limit, cover for medical emergencies and dental emergencies, as well as cover for medical evacuation. Your description of coverage often contains details and exclusions which you should take time to read thoroughly before you buy cover.

Trip cancellation or interruption

If for some reason, you can’t go on your trip or had to interrupt it midway, the trip cancellation section provides reimbursements for all your travel expenses. The reasons for trip cancellation could be illness, redundancy, an accident or death of a close relation, jury service and more. Specific detail is contained in the fine print and can vary from one provider to the next. Remember that if you want to make use of the trip cancellation section, then you need to buy travel insurance earlier – probably when you start booking your tickets and not the week before you travel. Some travel insurance companies do not cover cancellation at all, while some will only give cover for non-refundable, pre-booked costs. Reading the policy wording will help you determine what’s relevant to your situation.

Baggage and personal belongings

Some people cite loss of personal belongings as a very important reason to buy travel insurance. While it can be argued that lost belongings can easily be replaced, not having to shell out an unbudgeted $500 dollars for a new phone or laptop can be a source of pure joy. You must understand that if you are taking items of higher value such as cameras, phones, laptops and so on, you will need to declare them in your travel insurance plan. It goes without saying that you are expected to take care of your items and making a claim based on an item lost through your carelessness, will not be approved. Be sure to check your policy benefits for coverage limits, and exclusions, especially if you are travelling with items of high value such as sporting equipment.

Personal liability

If you are found legally liable for costs related to you accidentally causing bodily harm to someone else – or accidental damage to a person’s property – then the personal liability provides cover for this, up to a limit specified in your policy wording. You also need to remember that in most policies, certain exclusions apply to poor judgement resulting from the use of alcohol and other non-prescription drugs.

Passport and travel documents

You can get cover for the costs of replacing a passport or travel document that was lost whilst overseas. This could be as a result of theft or loss. Limits also apply and if you need to get a replacement passport from your embassy abroad, then your insurance policy provides coverage for this up to a specified limit.

Optional cover

Depending on your provider and policy choice, you can get cover for additional costs. The premiums and conditions for this cover can vary widely from one provider to the next. You can also purchase separate insurance for specific incidents such as:

Pre-existing conditions
Extreme sports, winter sports and adventure travel
Trips to countries that are considered high risk
Accidental death and dismemberment (AD&D)
Rental car
Acute onset of a chronic health issue
Hotel or airline insolvency issues
Pet care
Hijack

Your choice of travel insurance coverage should be practical, and you can choose optional cover, based on your anticipation of what you think most likely to happen during your trip.

Exclusions

Exclusions are occurrences that could invalidate your claim to insurance. The exclusions explicitly state what is not covered by your travel insurance policy. Exclusions are a critical part of your travel insurance cover. All travel insurance policies have exclusions which vary from one company to the next, as well as based on the policy type that you take. Be sure to read the exclusions thoroughly so that if you need to make a claim, you won’t be in for any nasty surprises. Each section of a travel insurance policy has its own specific exclusion. At the same time, your policy has general exclusions. The most common exclusions are as follows:

Pre-existing medical conditions

Your insurance provider won’t provide cover for a medical condition that you had before your trip, unless you declared it before buying your insurance cover. The definition of a pre-existing medical condition varies from one provider to the next; anything from recurrent bronchitis, to a previous broken knee acting up, could be considered pre-existing. If you want to ensure complete coverage, then be sure to give your providers full disclosure, especially if you are on chronic medication. Often, these disclosures will cause your premium to be increased, but ensuring cover if something goes wrong is more important than spending a few extra pounds.

Non-emergency surgery or treatment

If whilst abroad, you opt for treatment that is considered non-emergency by your provider, they can refuse coverage. This includes dental treatment that can wait until after your trip is over. Some companies do not include dental emergencies in their coverage, so be sure to ask about this.

Alcohol and other non-prescription drugs

Many insurers do not cover claims that are directly or indirectly made as a result of alcohol or other non-prescription drug consumption. Different companies however have different limits about what quantity of alcohol is considered reasonable. Being familiar with this aspect of your policy description can help you make wiser decisions whilst on vacation.

War and terrorism

Many insurance companies do not provide cover for war and acts of terrorism. Some will provide cover, but only as an additional cover and at a high premium. Cover for emergency medical expenses due to an act of terrorism or war, repatriation and additional hospital benefits, can also be obtained in a separate insurance cover.

How to ensure maximum coverage?

When you are travelling, buying the right travel insurance should be right at the top of your priority list. Carrying out sufficient research before you buy your policy is important, so you are not left hanging when you need your insurer to step in. Even if you buy an insurance policy and find that it’s incompatible with your purpose, the law requires that insurance companies give you 14 days within which to cancel and switch to a more suitable policy. If you want to ensure maximum coverage, then make sure to do the following:

Make sure you don’t hide any part of your medical history from your insurer, even if it is under control.
Tell your travel insurance your true travel purpose, so they can give proper advice on what travel policy plan will best suit you. If you intend to try out adventure sports, then take out the right policies as well.
Carefully read your policy description, making sure to discuss any misgivings or confusion with your provider, before you sign up to the travel insurance plan.
Report any incidents to the required authorities and to your provider as soon as possible.
If you are trying to make a claim and your provider is resisting, persevere. Sometimes the delay is just part of their process.
Make sure you keep any receipts or document relevant to your claim, to facilitate the documentation processes.

Finally, whatever your reason for travelling, do not proceed without getting a travel insurance policy. Even if you don’t need to use it, having that cover is a great way to ensure you have an anxiety-free trip