You can get cover for everything from lost luggage to cancellations, but make sure you don’t pay too much – or too little
Sunscreen and sunglasses are travel essentials, but insurance is perhaps the most important thing you can take on holiday.
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The average cost starts at around £20, according to GoCompare. This might seem like money you could better spend on a couple of bottles of wine or a nice meal, said Finder, but “it is dwarfed by the average claim amount of £800”.
Travel insurance can cover you for everything from lost luggage to flight delays and cancellations. The biggest concern for most travellers while on holiday, said the Association of British Insurers (ABI), is needing emergency medical treatment while overseas. “And rightly so,” the trade body said, “as these costs can be jaw-droppingly high.”
In one case, the cost of medical treatment in Spain following a fall and emergency medical repatriation back to the UK was an eye-watering £124,000. In another, treating a traveller who caught Covid while in Cyprus and getting them safely back to the UK cost £70,000, the ABI said.
Insurance can help cover the bill for these unexpected costs. Here is how to find the best deal.
Shop around
As with any financial product, it is important to shop around. Use comparison websites and compare plenty of quotes.
You may be offered add-on insurance by an agent or airline when you book a flight or holiday, said This Is Money, but this might not be the best choice for you.
“Low insurance costs might represent a great deal,” added the financial website, “or might be a sign that a policy lacks the specific cover you need.”
Additionally, if you have pre-existing medical conditions, many mainstream insurers on price comparison websites may not cover you at all.
Single v multi-trip policies
If you plan on travelling overseas more than three times a year, said MoneySuperMarket, an annual policy covering unlimited trips and holidays is likely to be more cost-effective than a single-trip policy.
In some cases, said Which?, it can actually be cheaper to buy an annual policy to insure just one holiday – especially for extended trips to destinations further afield than Europe. “This won’t always be true, but it’s worth investigating prices for both annual and single-trip cover when shopping around.”
If you are travelling with a partner, friends or family, said The Money Edit, you can usually get a discount if you buy travel insurance from the same provider, and it will make it easier to process a claim.
How much cover do you need?
Travel insurance policies provide different levels of cover and the more you need, the higher the cost or premium.
You can select an amount to cover you for the cost of lost luggage or cancellation but don’t pay for more protection than necessary. Weigh up whether you really need cancellation cover or an annual policy.
A low price doesn’t necessarily mean great value, though. There can be major differences between policies – some, for example, won’t include any cancellation cover. Others might not cover your baggage or belongings.
Some travellers may even find they are covered for belongings overseas through their home insurance, said MoneySuperMarket. Packaged current accounts may also include travel insurance as one of the perks, the comparison website said.
Increase your excess
There are two important figures that determine the cost of your travel insurance.
The premium is the cost of the policy but there is also an excess to pay if you have to make a claim.
A simple way to bring down the cost of a policy is by opting for a higher excess, said MoneySuperMarket. Make sure you can still “comfortably afford” to pay this sum, though, if you do need to make a claim.
Check exclusions
Check your policy so you know what’s covered as well as what is excluded.
Most insurers cover Covid medical costs, said This Is Money, but not many provide cover if you need to cancel or self-isolate due to testing positive, as it’s now considered a “known risk” when travelling.
Similarly, “natural disasters such as volcanic eruptions, flooding, and earthquakes will be excluded from claims, as well as acts of terrorism or civil unrest”.
While standard travel insurance policies can provide cover for most sporting activities, said The Money Edit, those that are “more on the adventurous side” such as extreme sports or skiing may be excluded or have specific terms and conditions around them so you will need specialist cover.
There are also ways you could invalidate your insurance, the financial website said, such as if you travel to areas the Foreign and Commonwealth Office advises against or if you have an accident after drinking too much or taking drugs.
You may wonder how many drinks is considered too many, said The Money Edit, but all insurers have their own guidelines ranging from the vague “drinking too much” to the more specific “approximately four pints”.
