What is Travel Insurance

Travel insurance provides financial protection in the event that you encounter certain issues when you’re travelling abroad or on holiday. Typically, it covers a range of possibilities, from lost luggage to the cost of medical care if you become ill or have an accident. We have highlighted below the advantages of taking out travel insurance and disadvantages in the event that should choose not to.

Why it’s so important and what do you need to think about when taking it out.

What does travel insurance cover?

Travelling without insurance could leave you open to picking up substantial bills if something were to go wrong.

Depending on the policy, travel insurance pays out in a wide range of circumstances.

Most policies include cover for:

• lost or stolen luggage (You must check that the policy covers this)
• emergency medical expenses, such as the cost of treatment and getting you home (repatriation)
• the costs of cancelling, delaying or cutting your trip short (with cancellation cover sometimes an additional extra)
• disruptions to travel or accommodation, such as delays and cancellations
• legal costs, in case you’re sued for damaging property or causing injury.

The exact cover available will vary significantly between different insurers and policies. So it’s important to be familiar with the policy wording before you buy.

What isn’t covered?

A lot depends on the policy and the insurer you go for. But there are a few things that travel insurance policies generally don’t cover, or which might only be available for an extra cost:

• If you have a medical condition, you might need specialist insurance. If you have a medical condition, you have to tell your insurer. If you don’t tell them, you risk invalidating your insurance policy - in other words, your claim might be rejected.
• Adventure sports, winter sports and potentially dangerous activities (such as climbing and white-water rafting) are often not covered as part of a standard travel insurance policy. So you might need to pay for extra cover.
• With most policies, you’re not covered for travel to countries or regions that the Foreign and Commonwealth Office recommends avoiding. See the latest list on the GOV.UK website
• Expensive or luxury items – such as watches, jewellery, laptops and cameras – are usually excluded. This is because they’re likely to exceed the ‘single article’ price limit for your policy.
• Your policy might not offer cover if your trip is affected by events such as civil unrest, earthquakes, pandemics or acts of terrorism.

Travel insurance if you have a medical condition

It can be difficult to know where to start looking for travel insurance if you have a medical condition.

For contact details of providers who specialise in providing travel insurance for people with serious medical conditions, further information is available by visiting the travel insurance directory or you may refer any enquires in regards to the MaPS directory to the Money Advice Service’s Customer Contact Centre which is available from Monday to Friday, 8am to 6pm: 0800 138 7777

What’s considered a medical condition for travel insurance?

Commonly known as a ‘pre-existing medical condition’, this term covers a lot – from allergies to broken bones.

Different insurance companies have different definitions. But your insurer is likely to consider any of the following a pre-existing medical condition:

• any condition you’re waiting for an operation on
• any condition that you’re currently awaiting test results for
• any condition, even a minor one, that you’ve seen a doctor about in the past year
• any serious condition – cancer, heart trouble, respiratory problems – you’ve ever had.

They’ll also want to know if you’re taking any medication.

You’ll need to declare all existing medical conditions when buying travel insurance.

If you’re not sure whether to declare, it’s important not to assume it’s covered. Always ask your insurance provider, otherwise you risk any claim you need to make being rejected.

Some policies or insurers won’t cover your medical condition. While others will give you cover but exclude your particular condition or charge extra for it.

Check your limits

Make sure your policy offers a decent level of cover. For example, your medical cover should be at least £1 million in Europe and £2 million for areas outside Europe. And the cancellation amount needs to cover your costs if you need to cancel your trip or return home early.

Most policies will provide at least £1 million in personal liability cover in case you’re sued for damaging property or injuring someone.

What types of travel insurance are there?

While policies can differ a lot in terms of cover, they will generally fall into one of the following categories:

• Single trip – covers you for a one-off trip for a set period of time.
• Annual/multi-trip – covers you for as many trips as you take within a whole year. Typically more cost-effective than the single trip option if you’re taking more than two holidays within that period.
• Backpacker/gap year – provides cover for multiple destinations over an extended period. You might need to add cover for the kinds of activities you plan on doing, such as adventure sports, work or volunteering.
• Winter sports – specialist cover if you’re going skiing, snowboarding or other winter sports. These are considered by insurers to be high-risk activities and so are excluded from most standard policies.
• Worldwide – there are usually two types of worldwide policy – those that cover the US and those that don’t.
• European – not always clear cut, as some policies cover areas that aren’t technically in Europe.
• Family – covers two adults plus up to four children travelling together. Suitable if your children are 18 or younger and live full-time with you.

Travel insurance and coronavirus

The current pandemic has changed travel insurance policies, and what will and won’t be covered.

Most travel insurance policies being issued now will have some sort of coronavirus cover included. But it’s important to always read the terms of the policy carefully.

For example, if coronavirus cancellation cover is included in the policy, this will usually only apply if the policyholder tests positive for the virus. If you have to cancel because you have to self-isolate or are in quarantine.

If you already have travel insurance, check the terms carefully to see whether: you’re covered:

• if you test positive for coronavirus before you travel, or
• while you’re on your trip.