As a nation we're usually well-prepared when we travel, but whilst most of us take out insurance before we travel, many of us don't read the policy- so we may not know what our cover is until it is too late
Travel insurance pays out if you are sick or injured while on holiday, lose your
luggage or are delayed at the airport. It also covers you if you have to cancel or cut short your holiday in certain situations. Anyone who's travelling abroad needs travel insurance, but remember to take it out as soon as you book your holiday, as many travel claims are for cancellation.
If you're travelling in Europe, don't just depend on reciprocal arrangements between EU countries for medical care. Although your medical bills may be covered if you pick up a form E111 from the post office, you won't be covered for the cost of getting home. Plus if you rely on your airline's compensation scheme if they lose your bags, the amount you'll get back is often low.
If you're taking a holiday in the UK, you may only need to take out insurance against cancellation. Your home contents insurance may cover you for loss of possessions, but always check first.
Make sure your cover is enough
If you have a gold credit card or a packaged current account, you may already have some free travel cover, but make sure the cover is enough, especially if you are going to the USA where medical costs are higher, or you are going to be skiing, snowboarding, diving or taking part in other 'hazardous activities'.
Shop around for your travel insurance - remember you don't have to take it out with your travel agent.
What does it cover?
Most travel insurance usually covers you for:
- Lost or delayed luggage
- Stolen or lost belongings. There may be limits on cash, and a limit on individual items
- Hospital and medical treatment while you are abroad
- Holiday cancellation. You'll be covered if you are too ill to travel or there has been a family death, but not if you just change your mind
- Delays. Cover usually only applies to delays on departure, not en route - and only if they're for more than 12 hours
- Curtailment. Policies may pay out if you can't enjoy your holiday as you are ill, in hospital or have to be flown home
- If you take out specialist travel insurance like winter sports cover or diving insurance you'll get extra cover
- Most provide a 24-hour Helpline providing legal and medical assistance
What's not covered?
- You probably won't be covered if your belongings are stolen as you've left them on the beach while swimming - you must keep your possessions safe
- You also won't be covered if you cancel your holiday just because you change you mind
- If you have not taken out specific hazardous pursuits insurance, you may not be covered for diving or skiing etc
Key pros and cons of travel insurance
- It can be difficult to compare like with like when looking at different policies
- Travel agents may try and push you to take out their travel insurance, but shop around first, get lots of quotes, and then decide
Things to consider when taking out travel insurance:
- What's the level of cover for different types of claim?
- What's the policy excess for different types of claim?
- What are the policy exclusions?
- Are you covered for hazardous pursuits, like skiing or diving?
- Are you covered if you cancel your holiday, and in what specific circumstances?
- Does the medical cover include the costs of transporting you back to your home country?
- If you are going to the USA, where medical bills are higher, is the level of medical cover sufficient?
- How long do you have to be delayed before the policy starts paying out, and what are the specific levels of cover it offers?
- What's your personal possessions and cash covered up to?
- Do you need to cover expensive items, like video cameras, separately?
- Do you have access to a 24 hour Helpline if you need it?