Is travel insurance worth it?

Are you organising a hiking trip to Nepal; bungee jumping in Ohio; or a romantic getaway in a hidden beach in the Caribbean? Prior to heading off to your destination, it is vital to ensure that you’ve made adequate travel insurance coverage.

Travel Insurance

Is travel insurance necessary?

This is a very popular question asked by many people going on holiday throughout the year. Understanding travel insurance policies and deciding whether to purchase insurance can be confusing at times and also time consuming. Consequently, we have put together this guide to make your decision and the entire process much easier. The guide explains what you are and are not likely to be covered for when taking out travel insurance, all the costs involved and the reasons why travel insurance is necessary. It also gives you some very useful tips to consider before you purchase a policy. You may also find our article on  airline insolvency  cover useful.

Firstly let’s start by clarifying the types and levels of travel insurance available.

The types available are usually:

  • Single trip: insurance to cover a single trip with options to usually extend the span of cover to winter sports

  • Annual multi trip: insurance to cover multiple annual trips for periods of 35, 50 or 100 days. You will need to check the travel insurer’s policy to see how many trips are included in the policy. Some insurers will allow you to specify the exact amount.

  • Gap year: typically offered for people looking to study abroad for 1 year. It covers all sorts of sports such as bungee jumping and white water rafting in addition to the more obvious voluntary work and family holidays. You will most likely be allowed to return home for short periods without invalidating the policy. If you are studying abroad there should be an additional option to cover the payment of tuition fees.

  • Long stay: the perfect policy for extended holidays covering you for a whole range of sports and medical expenses. You will usually personalise your policy by selecting how many months you want the cover to last. Usually this is anywhere from 3 months onwards.

  • Winter sports: In addition to the usual cover of lost baggage, medical expenses etc. (found in all policies) this policy covers a comprehensive range of winter sports and circumstances including skiing, ice skating, snowboarding and alpine. Losing your equipment or missing a day’s ski due to extreme weather is also covered!

    The levels of insurance are commonly referred to as bronze, silver and gold, with the latter two being the most purchased by travellers. Although many companies refrain from using ‘levels’ of cover and will just customise your policy giving you the situations you want covered and excluding those you are not concerned with.

    We’d always recommend to any traveller or holiday maker that you take out ‘gold insurance or the equivalent, if you are going to purchase any. Its well worth the additional amount of cover you receive for the extra cost! It should be noted that the most common differences between silver and gold insurance are that gold will give you a substantially larger sum of cover for each circumstance (in addition to airline insolvency cover) and the excess you will need to pay to claim on your insurance will be much less (perhaps zero). Also some insurers may add extra circumstantial cover in their gold insurance that isn’t in their silver. This could also be said about those insurers offering bronze levels of cover. Usually bronze will be the bare minimum cover for the more likely to occur events.

    So let me now explain what is usually covered in an insurance travel policy and what the general exclusions you should bear in mind are.

    Usually Covered

    • * Cancellation, curtailment or trip interruption charge
    • * Emergency medical expenses
    • * Hospital benefit
    • * Personal accident including death, loss of a limb or sight, permanent disability
    • * Baggage, valuables and business equipment
    • * Personal money, passport, documents and cash
    • * Personal liability
    • * Delayed departure (sometimes this is a gold only addition)
    • * Missed departure
    • * Legal expenses and assistance
    • * Hijack and kidnap
    • * Computer equipment

    Sometimes Covered

    • * Winter sports (although usually this is an additional extra you pay for)
    • * Extended kennel and cattery fees
    • * Burial or cremation abroad

    General Exclusions Applicable to all sections of the policy

    Claims directly or indirectly related to:

    • 1. War, invasion, acts of foreign enemies, terrorism, hostilities or warlike operations, rebellion, revolution, insurrection, civil commotion assuming the proportions of or amounting to an uprising, military or usurped power.
    • 2. Ionising radiation or contamination by radioactivity from any nuclear fuel or from any nuclear waste, from combustion of nuclear fuel, the radioactive, toxic, explosive or other hazardous properties of any nuclear assembly or nuclear component of such assembly.
    • 3. Participation in or practice of any sport or activity unless the appropriate additional premium has been paid and are shown as operative in your travel insurance certificate. However, even if winter sports cover is included you are still not covered for Off Peak skiing or snowboarding unless accompanied by a locally qualified guide.
    • 4. Engagement in or practice of: manual work in connection with a profession, business or trade.
    • 5. The use of motorised vehicles unless an applicable current United Kingdom driving licence is held permitting the use of such vehicles in the United Kingdom and the country visited.
    • 6. Drinking too much alcohol or alcohol abuse.
    • 7. Purposeful self-inflicted injury or illness, suicide or attempted suicide, sexually transmitted diseases, solvent abuse, the use of drugs (other than prescribed medication directed by a Medical Practitioner).
    • 8. Your own unlawful action or any criminal proceedings against you.
    • 9. Additional expenses such as the cost of replacing locks after losing keys, costs incurred in preparing a claim or loss of earnings following bodily injury or illness unless covered by the policy as an addition.
    • 10. Travel to a country or specific area/ event to which the Travel Advice Unit of the Foreign & Commonwealth Office or the World Health Organisation (WHO) or similar body has advised against all or all but essential travel.
    • 11. Any claims or costs caused by you jumping or moving from one balcony to  another regardless of the height of the balcony, unless your life is in danger.
    • 12. Loss of enjoyment.

    Is travel insurance worth it, or not? To buy, or not to buy?

    It’s time to answer the above questions.

    If you’re taking a holiday where the only cost is the £80 change fee of the airline, your economic losses if you need to cancel at the last minute will be minimal, but not all trips are that straight forward. For example, we all remember the crisis, panic, and extra cost the volcanic ash disaster caused many travellers, personal and business alike last year.

    So, depending on your tolerance for risk or need for peace of mind, travel insurance can be an expensive intention or a necessary part of any trip. With insurance, you might pay hundreds of pounds and never use it. BUT, without it, you might be out hundreds or thousands of pounds because. You might be wondering what could possibly go wrong. Here are your answers:

    Reasons to buy travel insurance

    • 1. Cancelled flights.
    • 2. Medication lost in your travel luggage and you need to have an emergency prescription filled.
    • 3. Passport and wallet stolen, and you need cash and a replacement passport.
    • 4. You’re involved in an accident and adequate medical treatment is not available. You need medical evacuation.
    • 5. Cancelling your holiday due to sickness.
    • 6. Your cruise liner, airline or tour company becomes solvent. You need your non-refundable expenses covered and to get to your destination.
    • 7. Any health emergency that occurs in another country.
    • 8. A terrorist attack or incident happens in the destination you are travelling to and you need to cancel your holiday.
    • 9. A hurricane forces you to leave your resort, hotel or cruise.

    Therefore, we would suggest that you forget contemplating your decision any further and go for the safest option – purchase the right level of insurance.

    Travel insurance tips that can assist you in determining the type of travel cover that is best for you.

    • 1. Become familiar with what is available on the market. Travel insurance can incorporate cancelling trips, any disruptions to your journey, deaths that happen through accidents or any mutilation, any care that you need related to medical or dental needs, any transport that you might to get you to a hospital, any lost baggage or your individual possessions and safeguarding you against your travel operator going bankrupt.
    • 2. Establish if you have cover already. Many homeowners’ policies offer cover for theft as well as any additional losses whilst you are away from your home. You might be able to use your medical cover and vehicle insurance in countries outside of the UK. Your life insurance plan should provide cover for both you and any family members whilst you travel. Plus, air companies have to compensate you when it is their fault that you have lost your baggage
    • 3. Consider any credit cards, plus vehicle insurance that you have too. Check the kind of protection you’ve got already from the small plastic cards inside your purse. The Platinum Card with American Express is particularly good when it comes to death as a result of an accident and dismemberment cover. They also cover you for any loss that you incur because of renting a car and give you additional protection for any baggage loss.
    • 4. Purchase via a third-party insurer. Tour operators, travel agents, plus cruise liners all offer insurance for travel, however, your best option is to get cover via an insurance company that is already established. If you do this, then your cover will not be worthless if for any reason your travel firm goes insolvent. You can get a direct travel insurance quote from Columbus Direct who includes airline insolvency cover in their policies.
    • 5. Make sure that you ask the correct questions. When you look around, ask insurance providers: What type of catastrophes will be covered? Do they have any restrictions? What level of help will the insurance firm offer if you have a medical crisis or any other serious issue? Also ask them how they determine what they will or will not reimburse?
    • 6. Stay clear of any flight insurance that is sold through vending machines. You might have noticed these kinds of offers at some airports? They’have been put there to take advantage of people’s concerns about flying, however, keep in mind: The cheapest method of insuring your entire life is via a life insurance plan that is long-term, which you might already have. Also, you might have a credit card that offers such coverage too.
    • 7. Understand cancellation waivers. Many cruise liners and tour companies tend to offer waivers for around £25 to £40 as cover if you need to cancel your holiday. Whilst these waivers offer you some kind of protection, they usually have plenty of limitations. Moreover, they are not really legalised.
    • 8. Contemplate extra coverage. If you need to travel with electronic items, sports gear or jewellery that is expensive, you might want to think about a floater with your current homeowners’ plan. This might be a fairly cheap way of insuring such items.
    • 9. You must know how much any medical support cover is worth. This will cover you if you need to lifted off a cliff with an airplane, get any long-term treatment at a hospital in another country, or get flown back home as a result of the severity of your illness or injury. Determine if your health insurance covers you abroad and pays for your return flight home in case of any emergencies, prior to purchasing the policy. If you’ve got Medicare cover, it might be useful as you probably won’t have cover outside of the US.
    • To finish, in today’s unpredictable world of travel, insurance is an essential travel item. Just check any existing insurance plans and credit cards that you have and ask yourself what is already covered. If you don’t have any cover at all, go ahead and purchase the top policy (GOLD). Insurance for any type of travel is worth it for 3 major reasons: peaces of mind, safeguarding against any unforeseen circumstances and fear over losing financial investment in a trip.
    • Get a direct quote from Columbus Direct, they offer comprehensive insurance policies that will cover you for all the right circumstances including the unlikely events of airline insolvency and ash and cloud cover from volcano eruptions.

    Direct Line & The AA also offer cover for Airline Insolvency with Direct Line in particular worth checking out as a direct insurer that doesn’t advertise it’s policies on comparison websites.

    If you are a UK or EU citizen we also recommend you read our guide on the European Insurance Health Card which provides an excellent and free supplement to your travel insurance policy.