This is part one of a four part series on buying travel insurance, seeking compensation if things go wrong and the British Consular Service. We will be publishing one page a month during the summer 2014.
Firstly I would like to make it clear that we do not sell travel insurance. We do have a travel insurance page provided to us by Holiday Extras, but this is only to offer an easy route for our site users who need to buy travel insurance that suites them. What we are though is a Foreign Office “Know Before You Go” partner and like them we want you to have a great holiday and not have it turn into a nightmare.
Over the course of this series we will cover the official travel insurance advice and what to do if things go wrong, what embassies and consulates can and cannot do to help you and your options for getting compensation if things do go wrong.
A lot of people already have some form of cover provided by their credit card or bank account, as part of their home insurance and you should carry an EHIC (European Health Insurance Card) if you travelling in Europe. These often provide really minimalist cover and should not be considered an enough cover. If you needed to be brought back from the Canary Islands then you are looking at a bill of up to £16,000, from the USA then it could be anything up to £45,000. That is just the air ambulance costs your medical treatment would be on top of that. Your travel insurance exists only to protect you from these and other expenses should things go wrong.
The main expenses you are most likely to incur in an emergency are medical and health expenses should you be injured or simply fall ill. The cost of using the emergency services. You being sued should you cause an injury or damage property and the cost for replacing lost or damaged property. In an non-emergency then you are looking at being refunded for money you have paid out should your holiday be cancelled or if you need to return home early through no fault of your own.
Travel insurance is a commercial product and you can spend very little or you can spend a lot but when you do want to make a claim then that is when you will really tell the difference. These companies are not charities, they are there to make a profit. They balance the possible maximum you could claim for, the frequency that people make claims and try and set the premium so that the amount they have coming in is more than the amount they pay out. If you compare to policies and they appear to cover the same events with the same amount of cover but the prices are significantly different then the missing factor is probably how often the insurer actually pays out.
One way they [insurers] can avoid paying out is to exclude specific activities. When you get to the small print then you may find either that you need to pay extra if you want to be covered for jet skiing or that jet skiing invalidates your policy. Not so useful if you are on a water sports holiday.
On the other hand your policy should definitely cover you should something happen to your airline which is something completely outside your control. This is called SAFI or Standard Airline Failure Insurance. Over the past few years, during the recession, we saw many small airlines and travel agencies go bust. The UK may be out of recession but the Eurozone still has its problems so this is a must.
You do have a choice between a single trip policy which is what most people buy if they are only going on holiday once a year or an annual/multi-trip policy. What people don’t often realise is that if you have an annual policy it covers you for travel even within the UK. If you book a weekend away in Cornwall and then fall ill then you could claim on your annual policy. Dispite the name an annual policy is not the right policy for a gap year oran extended round the world trip. Annual policies have a maximum number of days you can be away from home either in a single trip or for the year in total.
I am not going to detail every possible type of insurance you can get or the merits of each type, needless to say there are specialists for every niche from students to cruising. Just bear in mind that most policies will exclude any alcohol related incident (or drugs for that matter), if the insurer thinks you contributed to your loss then they will not pay out, so take care of your belongings and only about half of the policies I looked at will cover you terrorism related losses and that includes delays at the airport for bomb scares not just being the direct victim of an attack!