A Comprehensive Guide to Travel Insurance

If you are a frequent traveller, you might have inevitably had the opportunity to buy travel insurance and knowing very little about it; you could not tell whether it was an excellent deal or a rip-off. Any time you engage in extensive travelling, you are always at risk of physical or financial loss, and this means that you will need some kind of cover. Whether you will be travelling locally or abroad, it is imperative that you secure a travel insurance policy.

To give a little analogy, when famous holidaymaker Michael Doyle got blood poisoning in Bulgaria on July 2016, his family tried to arrange a medical flight that would get him back home to the United Kingdom. However, his travel insurers refused to incur the cost of medical bills or flights citing that the policy he had did not cover him, and Michael died a fortnight later from kidney failure. This is a good case of an individual who took up travel insurance knowing very little about it.

To aid you in making a more informed decision, this piece will dig into the aspects of travel insurance so that you are equipped with the knowledge to help you in the future. Let’s get started.

The Basics of Travel Insurance

Travelling often involves risks like the risk of having an accident, falling sick, having your valuable items stolen, missed flights, and in worst case scenarios the loss of life. With travel insurance, however, you can vacate with peace of mind knowing that you have mitigated all financial damages that could be associated with these risks. There are usually five primary types of travel insurance that companies offer, but you can still purchase supplemental policies to provide coverage for some specific concerns like identity theft. Most of these types of travel insurance could be bought in a comprehensive travel insurance package.

  1. 1. Flight Insurance

    Flight Insurance is one of the main types of travel insurance, and it is usually a life insurance policy which covers you if the plane crashes when you are going for your trip. In most cases, plane crashes are fatal and result in the death of the passengers. If that occurs and the passengers had flight insurance, then their family will receive compensation for the loss.

  2. 2. Baggage Insurance

    Travellers will often have many items to carry during their trip, and it is vital to have such items covered as well. With this regard, this type of insurance usually covers luggage that is either lost, damaged, or delayed during your flight or trip. Baggage insurance is often included in many package travel insurance policies. However, it is important to note that there could be price caps or exclusions on electronics, jewellery, or other expensive accessories.

  3. 3. Trip Cancellation/Interruption Insurance

    This type of insurance is supposed to cover all your expenses if your trip is cancelled or interrupted for any unforeseen reasons like health issues or if an organised tour which you had paid for is suspended or revoked. This insurance will cover all the non-refundable fees which you had purchased in to take your trip. Additionally, this insurance could also cover you in the event that you will have to miss your flight because of inclement weather or an accident.

  4. 4. Medical Insurance

    Medical travel insurance usually offers additional coverage if you will be travelling internationally and could help settle “out-of-network” provider fees or deductibles that your current health insurance won’t pay. Essentially, this medical insurance cover usually picks up and pays all healthcare expenses that your primary healthcare insurance policy doesn’t cover.

  5. 5. Evacuation Insurance

    If you happen to fall sick or be involved in an accident while on your trip to a foreign country, the chances are that you will not be able to receive treatment in the country and will have to fly back to your home country for medical attention. If you buy evacuation insurance, it will cover all costs of transporting you to a facility where you will receive the necessary treatment in case of an emergency. Some insurance providers will subject this policy to exclusions for dangerous activities like skydiving although supplemental insurance could be purchased to cover any sports adventure activities you want to engage in.

Who Needs And Who Doesn’t Need Travel Insurance?

Numerous companies, including insurance companies, can write Travel insurance. In some cases, travel insurance could be offered as part of your car rental contract or as part of the vacation package you purchase from a travel company. For an individual who travels extensively and is looking to enjoy peace of mind knowing that they are covered even when the worst happens, then travel insurance is a good idea. However, if you are an infrequent traveller or have coverage through another policy, purchasing travel insurance could be a waste of cash.

What Coverage You Might Have

In some instances, travel-related losses could be covered by your medical insurance, renters insurance, homeowners insurance or coverage for loss offered by your credit card company. It is always essential that you check into the coverage you might already have before deciding to buy additional travel insurance which you might not need.

You should always ensure that you do not already have coverage against travel risks by an already existing insurance policy before purchasing extra travel insurance. Moreover, if you buy travel insurance, be sure to read the fine print to ensure you are aware of who and what is covered in your insurance policy and the amount of policy term and claim limits.

Choosing the Best Travel Insurance Company

When you are looking for travel insurance or deciding whether you need travel insurance, there are several aspects you need to take into account before making a purchase. Here is a run-down of the criteria you could use to compare travel insurance companies and settle on one that adequately meets your travel and coverage needs.

  1. 1. Do You Need the Travel Insurance?

    Not every traveller will essentially require travel insurance. For example, you could already have an existing coverage for any travel-related losses from your renter’s or homeowner’s insurance policy. You could also have travel coverage from your car rental agreement, Credit Card Company or just as part of your vacation travel package. If you will be travelling internationally or domestically for a distance that exceeds 100 miles and you have an insurable interest you need to protect, travel insurance could be hugely beneficial to you. However, you will need to identify any existing coverage you might have before deciding to buy additional travel insurance.

  2. 2. What’s Your Budget?

    When it comes to choosing a travel insurance company, it is crucial that you also consider your travel budget. Typically, you should expect to pay anything from five to ten per cent of your overall trip expenses to cover your travel insurance. There are some things you could do to save money on your travel insurance plan. They include going for a higher deductible, electing for the most straightforward policy without any extra add-ons like concierge services, identity theft protection, expanded luggage coverage, travel companion benefits, coverage for any pre-existing medical conditions or trip interruption coverage.

    Some travel insurance companies will have a limit to the maximum distance for which they can offer coverage. This implies that you will need to have an idea of how much you are willing to spend on travel insurance. So once you decide on a budget, you can quickly settle on a company that meets your needs.

Domestic Vs. International Traveling

Your travel destination will determine whether you will go for a domestic or international travel insurance plan as well as the company to approach to buy travel insurance. Not all travel insurance policies will cover international travel and trips to specifically named countries could also be excluded from the coverage. Also, when it comes to domestic and international travel, you will also need to consider medical expenses. If you deem it necessary to have coverage for any emergency care when you are on your trip, you will most likely need to have the care offered by an ‘out-of-network” medical provider.

Some travel insurance companies will offer medical emergency coverage for both local and international trips while others will not. Also, if the health insurance policy you already have doesn’t cover all your out-of-pocket charges, the travel insurance company you choose could make the difference. When approaching an insurance company for coverage for your trip, you will need to be clear about the nature of your journey.

Use Comparison Tools

The trick to securing the best policy for your travel needs is shopping around to see which company has the best offers. Also, when it comes to shopping around for a travel insurance provider, most customers want to enjoy the luxury of being able to compare multiple companies at a go. When looking for a travel insurance company, it is advisable that you use comparison sites or tools that let you compare your travel insurance options based on criteria like destination, trip cost, citizenship status, residence, return dates, and more. With such comparison tools, you can see everything from pricing and all available packages side-by-side and make an informed decision based on your specific travel needs. After comparison, you could also choose to purchase a policy online via the comparison tool, which essentially saves you time. Such comparison sites could be a useful tool when you have little time to spend comparing the travel insurance companies the market has to offer.

After a careful evaluation of the insurance company you want, then comes the tricky part of choosing a policy. Now let’s walk you through purchasing a travel insurance policy.

How Can You Choose the Right Policy

How can you settle on the best-value travel policy? Well, while most of you might be tempted to consider a price comparison and purchase the cheapest policy quickly, the truth is that there is a catch. Price-comparison websites often seem to have an exciting effect. Since they are relied on by many users, there is a lot of competition among insurance companies to keep their services and products low to ensure thy show up at the top of search results.

When shopping for a travel insurance policy, it is important to note that travellers have different needs and price should not be the only determining factor. Most of these needs depend on aspects like the traveller’s age, the kind of activities they engage in (there are numerous exclusions and limitations regarding outdoor activities), how often they travel, how risk-prone they are and more. With all these variations in mind, it would be difficult to make a recommendation for a policy that would be an excellent purchase for all travellers. Instead, we have set out factors to take into account when purchasing your travel insurance policy.

  • Multi-trip: Multi-trip policies usually cover all travelling you will do in a single calendar year, with limits on the actual length of every trip you make. Whether it will be cheaper to purchase such a policy that separate policies for every drip often depends on the amount of travelling you do annually and more than four trips with such an insurance policy means that you will save a lot of money. Another merit of this type of policy is that you have continuous coverage and will not have to go out shopping for a new policy every time you book your next trip
  • Multiple Cover: When shopping for insurance policies, it would be a good idea to buy cover for a family or a couple under a single policy. For instance, if you will be covering two adults, one child aged 10 and one aged 15, you will want a policy that lets each of you travel independently. While such policies are hard to find, the truth is that they are the best policies.
  • The Standard Limits: When looking for a travel insurance policy, it is essential to consider the limits for the critical aspects of the cover as well as the expense range. If you intend to make a trip to a destination where there are frequent natural disasters, like earthquakes, the chances are that you could be exposed to much risk. Besides the destination, there is also a limit to the amount of coverage you can get for your baggage, the amount you can receive in the event of a trip interruption/cancellation or the amount of emergency medical cover you can get. If you are displaying at a trade expo, you will need to look for a policy that offers a higher limit on baggage coverage since you will probably carry lots of valuables.
  • Additional Cover: When choosing a travel insurance policy, it is vital that you consider whether there is some extra cover offered. For instance, you will want to look for a policy that includes a per-person financial protection for the failure of your airline or the travel company. In a few cases, the insurance policy could extend to cover some extra losses like booking and paying for a hotel but fail to get there because your airline went bust. You should always be sure to look for an insurance policy that offers additional cover depending on your needs.
  • Activities: While you might not look forward to an active year, you might as well go sailing and walking on your next trip. When choosing a travel insurance policy, it is advisable that you go for one that has the most extended list of activities and sports which are automatically covered. Moreover, while a long list might not matter in all instances, it is advisable that you choose a policy that includes the activity you will most probably take part in. It is also important to understand that some activities are highly destination specific. For instance, elephant and camel riding activities should be covered if you want to visit a country like Malaysia. You do not want to get severe injuries after falling from an elephant only to realise that you did not have coverage for it.

    Still on activities, it is essential also to consider winter sports when choosing a travel insurance policy. The definitions of cover in different winter sports vary, and there are numerous loopholes you could slip through. With helmets, for instance, it would be safe to put on your helmet despite what the policy says, but if you don’t often prefer that, you will need to check whether the policy allows that. Some insurance policies will state that you must have your helmet on for your insurance to be viable in the event of an accident while skiing. With sporting activities, there is also the aspect regarding off-piste, and you will need to check if it is covered, whether you will need to have a guide accompany you and whether there are other restrictions. If your policy covers skiing within the boundaries of the ski area, then any accidents that occur beyond the borders won’t be included.

Final Thoughts

Only you are in a position to decide whether the cost of travel insurance is actually worth the peace of mind of having protection against the risks associated with travelling. If you are a frequent traveller, you want to ensure you are protected so take time and shop around for what meets your needs.