Travel Insurance Basics

The vast majority of holidays go off without a hitch with most holidaymakers experiencing nothing worse than a bit too much exposure to the sun. However in the tiny minority of cases where things do go wrong it can be a great source of comfort to know that you will be well taken care of and that you will be able to cover the huge costs often associated with emergencies abroad. This is exactly where travel insurance comes in. The purpose of travel insurance is to offer cover against some of the most common mishaps (ranging from the irritating to the life threatening) that people experience while they are on holiday or travelling for business.

The first important distinction that travellers have to make when buying travel insurance is how long they want their policies to run for. It is possible to buy a ‘single trip’ policy that will only cover you for a specified amount of time. The other alternative would be an ‘annual multi trip policy’. This will almost certainly work out cheaper than getting a series of single trip policies if you are a frequent traveller. The fact that you are insured year round also means that you can save yourself the hassle of having to arrange insurance before every single trip.

In evaluating travel insurance policies it is important to verify that they have excellent cover in all of the following areas:

Medical Cover: Emergency medical expenses in a foreign country can be extremely high and excellent medical cover should therefore form the cornerstone of any travel insurance policy. Some of the things that are generally covered are:

• Emergency treatment and hospitalisation
• Evacuation and/or repatriation if necessary
• After care (e.g. payment for physiotherapy after an injury)

United Kingdom citizens travelling in the Europe Union enjoy the privilege of free or reduced fee medical treatment. Getting a ‘Europe Only’ travel insurance policy can therefore sometimes be significantly cheaper than a worldwide one. You can prove your entitlement to free or reduced medical care in Europe by applying for and always carrying an “European Health Insurance Card” (EHIC) with you.*

Cancellation/Postponement Cover: This part of your policy will cover you against unforeseen events like a flight being delayed for a long time (your policy will help to cover costs incurred, e.g. hotel bills, in such cases) or cancelled altogether. It will also normally cover you if you have to cancel a holiday or flight from your side due to unforeseen circumstances.

Possessions Cover: Knowing that your property is insured against loss, theft or damage can be very reassuring when travelling.

Personal Accident Cover: Most travel insurance policies will pay out a lump sum upon your death or permanent disability.

Legal Expenses: Being sued in a foreign country can be a daunting experience. Many travel insurance policies cover legal expenses related to personal liability arising from accidents and other incidents.

When choosing a travel insurance policy it is important to make sure that it fits in perfectly with your particular circumstances and destination. In some cases you will, for example, have to pay an extra premium if you participate in any activity considered high risk (e.g. bungee jumping, snowboarding etc.). Checking whether there is not a Foreign and Commonwealth Office (FCO) warning against all travel to a destination in place is also a good idea since some insurance companies clearly state that their policies will not be valid if you ignore FCO advice^.

Summary:

• Travel Insurance can be a great way to experience a bit of peace of mind while travelling
• Policies are generally for a single trip or for multiple trips over a year.
• The areas that are normally covered by travel insurance policies are: Medical, Possessions, Cancellation and postponement, Legal and Personal Accident
• It is important to check whether you are adequately covered, especially in the light of exclusions related to hazardous activities and FCO warnings

* More information about the European Health Insurance Card can be found at: http://www.nhs.uk/EHIC/Pages/About.aspx
^ The full details of FCO travel advice for different countries can be found at:
http://www.fco.gov.uk/en/travelling-and-living-overseas/travel-advice-by-country