‘That’ll be two policies’: the travel insurance quote that sent my colleague packing

A few days ago, I recounted a story about my colleague Emma and her superannuation comeback. It turns out Emma is full of stories, this time about travel insurance quotes for a family holiday. You’d think travel insurance would be pretty straightforward compared to something like super - and in most cases it is. 

But in this instance, Emma’s unique family situation - and the nature of her trip - made it anything but. And it serves as a great reminder about why it’s important to compare policies closely instead of going with the first quote you get.

So as Emma started recounting her story, I took out my trusty notebook and started taking copious notes, because this one’s also a doozy. 

So zip your suitcase, get your passports ready, and let’s get on with the story.

The hunt for cancellation cover

First, a quick sketch of Emma’s international holiday. Four travellers: Emma, her husband, and their two sons. At the end, Emma stays on for five extra days. With elderly parents at home, cancellation cover was the priority in case a health issue meant the family had to call it off.

So she asked her travel agent for a quote.

“The initial quote was so expensive,” Emma said. “And so rigid. The cover amounts were so small. The cancellation cover for all of us was maybe ten thousand dollars, which is not a lot once you add up everyone’s flights and hotels.”

Then the small itinerary detail perhaps became the biggest roadblock. Because Emma was staying on for a few extra days while her husband and sons flew home first, the travel agent said they could not be on the same policy. “They told me I would have to get my own separate policy,” she told me. “By then, the cost started to get ridiculous.”

The separate trips rule that changed the decision

That was the moment. The same feeling she had with super.

So Emma opened the laptop and started comparing policies.

She found another insurance provider and the differences became apparent quite quickly. “The new quote was half the price,” she said sounding annoyed. “The cancellation was unlimited, and I found out that as long as I was travelling seventy five percent of the trip together with my family, we could all be under the same policy with that insurer.”

There was one more win. Her sons are twenty and eighteen. “With the other quote, they weren’t considered dependants because they were over eighteen,” Emma said. “But this new insurer considered them dependants because they are studying and literally still depend on me. And this meant they were covered free under our policy.”

The fine print you cannot see until you ask

If there’s one takeaway beyond comparing, it’s to understand the fine print in your product disclosure statement (PDS), and to seek clarity when needed. “You know what a PDS is like,” Emma said, laughing. “You need a law degree to understand the fine print. I could not find what I needed to be absolutely sure I was covered in the way I expected.”

So she called the new insurer. The customer service agent on the other end confirmed their seventy five percent requirement and that her student sons counted as dependants. They then offered to send a new quote with an additional eight percent discount saving her even more money.

“They were very friendly,” Emma said. “And it was very refreshing.” 

Exactly how a holiday should feel.

Sense-checking your travel insurance policy

Take a cue from my financially savvy colleague: before you accept the first quote, make sure you’re clear on the conditions that matter to you most. Using Emma’s trip as the example, here’s what she focused on to find the best option her her family:

• Cancellation limit. Is there a fixed limit or is it unlimited? Does it cover the kind of cancellation you might face? For example, change of mind often isn’t included or may cost extra.
• Trip dynamics. One traveller staying on, different return dates, a short side trip. Check whether a single policy can cover it all.
• Who is treated as a dependant. Many policies include dependant children on a family policy at a reduced rate or even for free. Check the age limit and any wording that could extend that age limit for children that are still studying or living at home.
• Policy conditions. Make sure you are aware of any limits, sublimits and waiting periods. The cancellation and trip change sections are worth a careful read.

These are not the only factors to consider. Other travellers might care about cover for pre-existing conditions, specialised trips like ski trips or cruises, rental car conditions, pregnancy limits, business equipment and more. 

If any of these matter to you, make sure you double check the fine print in your PDS. If anything’s unclear, call the insurer for clarification and get it in writing if needed.

Your next move

Let Emma’s story be an inspiration. From the start she knew what she needed in a policy, said no to the first quote, compared options, read the nitty gritty and wasn’t afraid to pick up the phone when she wanted more clarity. And with a small amount of due diligence she landed a policy for a fraction of the price with significantly better cover. 

Do not be afraid to get your own hands dirty. A little homework now can give your trip a lot more runway.