Travel Insurance – Do You Need It?

Travel insurance is most probably the most boring part about planning a holiday yet it could also the most important.  If you can not afford travel insurance, then you really can’t afford to go on a holiday.  While this may sound harsh it Is true.  If you can’t afford say $300 for travel insurance, how are you going to afford a few thousand dollars on medical bills or with one claim I have seen, just over $1.2 million.

Having said all that, depending on your travel you may not actually need travel insurance and may even be a waste of money getting it.  For example, if you are visiting family in the same country and all you have needed to purchase is a cheap airfare and you don’t mind losing the money if something happens then travel insurance may not be the best use of your money.  While there are those few instances where travel insurance is not needed here at we are talking about family holidays.

Family holidays are generally more than just cheap domestic airfares.  We are looking at airfares (domestic and international), luggage and personal valuables, your passports and cash, accommodation, transfers, hotels, tours, overseas medical, emergency accommodation and even emergency cancelations. Let’s say you are about to leave within the week on this magical $30k adventure with your family that you have been saving to go on and your child gets seriously ill or you just loose your job, can you afford to just loose $30k?  What about if you are ready to come home and all of sudden volcanic ash cloud has forced the grounding of all planes and you need to find accommodation for the next 4 to 5 days.  Can you afford to all of a sudden cover another 5 days of not only accommodation but now another 6 days of meals?  There are many more hypotheticals we can go through, but let’s just say that travel insurance is necessary.

Now, what kind of things do we need to look out for with our travel insurance?  Firstly, let me just say that cheapest is not always best but on the other hand the most expensive may also not be the best.  What you need to look at are the inclusions and exclusions.  It also comes down to your itinerary and what you are planning on doing.  If you are looking to skiing, bungee jumping or skydiving, then not all travel insurance will cover you if you get injured.

Here are 17 things you should look for when comparing travel insurance companies:

  1. Overseas medical and dental expenses – Cover for overseas hospital, medical, surgical, nursing, ambulance and emergency dental expenses.
  2. Additional expenses – Cover for additional accommodation and transportation expenses as a result of certain events including injury, sickness, disease, natural disasters, collisions, strikes and lost travel documents.
  3. Amendment or cancellation costs – Cover if the Journey has to be rearranged or cancelled due to an unforeseeable circumstance outside your control. e.g. illness, accident or extreme weather conditions.
  4. Luggage and travel documents – Cover for lost, stolen or damaged luggage and personal effects. Travel documents – cover for replacement cost if lost or stolen.
  5. Delayed luggage allowance – Cover for the cost of essential emergency purchases overseas if all Your luggage is delayed by a Transport Provider.
  6. Money – Cover for cash which is lost or stolen from your person.
  7. Rental Car insurance excess – Cover for any rental car insurance excess you become liable to pay as a result of damage to, or theft of, a Rental Car.
  8. Travel delay – Cover for additional accommodation expenses if your scheduled transport is delayed.
  9. Kidnap and ransom – Reimbursement for ransom monies paid if you are Kidnapped during the Journey.
  10. Hospital incidentals – Covers the cost of miscellaneous expenses if you are hospitalised overseas.
  11. Hijacking – An allowance for a period you are forcibly detained on a means of public transport which has been hijacked.
  12. Loss of income – Cover if you are unable to work on your return to your home country due to an injury sustained during the Journey.
  13. Disability – Cover if an accidental injury sustained during your Journey causes certain disabilities.
  14. Accidental death – Cover if you die due to an injury sustained during your Journey.
  15. Personal liability – Cover for legal liability if your negligent act during the Journey causes bodily injury or damage to property of other persons.
  16. Excess levels – The cheaper your excess, the higher your premiums. The higher your excess, the cheaper your premiums.  It all comes down to what excess you can afford to pay up front.
  17. Appropriate level of cover – Make sure that you have chosen the appropriate level of cover for what you paid. You don’t want a $2000 cancelation limit when you have paid more than $10000.

One final piece of advice in regards to travel insurance.  Be honest.  Paying for travel is entering into a legal contract.  If you don’t declare existing medical condition for example and you end up in hospital, then expect to be left with a hefty bill.

For me, travel insurance is piece of mind.  Knowing I am covered if anything goes wrong means I can relax and enjoy the holiday I have been waiting so long to take.


Leave a Reply

Your email address will not be published. Required fields are marked *