Travel insurance FAQs - all your questions answered
When it comes to protecting your finances, personal belongings and most importantly your health on overseas trips, nothing beats travel insurance.
Whether you’re taking the whole family to Europe or have a big solo trip pencilled in, this is the guide for your insurance needs. Scroll down for the must-knows...
What is travel insurance?
It’s simply an insurance that will cover you financially (up to a specified limit) against any mishaps that occur while you’re on holiday. Some of the common things you’ll be covered for include trip cancellation, lost luggage, overseas activities, medical expenses and personal liability.
Why do I need it?
While taking out travel insurance for a holiday isn’t compulsory, it is a great way to minimise your financial risk, if things turn south while you’re away.
It’s important to remember that if you don’t have travel insurance, you’re responsible for out of pocket expenses overseas including emergency medical bills, which can reach into the hundreds of thousands in countries like America.
Mozo tip: When looking for travel insurance keep in mind each policy will provide you with a different level of cover, so always take the time to read the fine print to ensure you’ll have the cover you need.
How much does travel insurance cost?
Good question! Like most insurances, the upfront cost of travel insurance (also known as the “premium”) can vary between policies. The price can be influenced by a range of factors, from where you’re travelling, to how old you are.
There are also some circumstances where you may have to pay a higher premium for cover - for instance if you have a pre-existing medical condition (this can include pregnancy) or will be partaking in “extreme” sports overseas like bungee jumping, jet-skiing or mountain biking (more on this below).
What does “excess” mean?
Here’s something else to know about travel insurance - if you need to make a claim when you return from holiday you’ll have to pay an excess.
For instance, say a petty thief ran away with your handbag and you filed a $500 claim. If your claim went through and the excess was $100, your insurer would give you a $400 reimbursement for your loss.
The reason that insurers charge excess is to prevent customers from making small travel insurance claims and also acts as a way to give consumers some financial responsibility for any loss incurred overseas.
Tidbit: Often insurers will lower the excess that you’ll have to pay in the case of a claim, if you pay a higher premium upfront.
So what does travel insurance cover?
There’s a range of out of pocket expenses your travel insurer can reimburse you for, depending on your level of cover. We’ve listed the most common types below...
Luggage and personal effects: Suitcases get lost en route to other countries all the time. Thankfully, you can count on your travel insurer to compensate you for it (depending on your policy). The same goes for any other personal items that a service provider has misplaced, or belongings that have been stolen. Of course, you’ll need proof like an airline statement or police report to backup your claim.
Overseas medical expenses: Your Medicare card or Aussie private health insurance can’t cover your medical bills if you wind up in hospital overseas, but your travel insurer can. That’s provided you’ve disclosed any pre-existing medical conditions, and you have an adequate level of cover included in your policy.
Personal liability: If you damage someone else’s property or somehow manage to harm a stranger by accident, your insurer could have you covered. This can include incidents like denting a hire car or breaking items in your hotel by mistake.
Flight cancellations and delays: There’s nothing more frustrating than your time in a city getting cut short by flight delays or train cancellations. The good news is, that your travel insurance can soften the financial blow to your change of plans. Just keep all relevant documents to prove it (and choose an adequate policy to back you up).
What levels of cover are there?
Providers generally offer three tiers of travel insurance - basic, standard and comprehensive. Here’s a rough outline of the three types you’ll see when comparing insurances in the market:
1. Basic. Usually insures potential travel mishaps like loss of luggage and medical bills up to a threshold amount.
2. Standard. Generally includes unlimited medical and flight cancellation cover.
3. Comprehensive. The most robust level of cover you’ll find in a travel insurance policy, which casts a wider net on the incidents and items you can lodge a claim for. Comprehensive travel insurance policies are known to have higher premiums and lower excesses.
Any common exclusions to be aware of?
Specific to you: Some exclusions relating to you personally can include pre-existing medical conditions, being pregnant or aged over 55 years. While most insurers help you tailor policies to suit you, they may not give you cover you in certain scenarios like unlimited medical (if it’s related to your condition).
Activities: If your idea of fun is more on the risky side (like off piste skiing), you may need to pay a higher premium to be covered or take out a specialised policy. Keep in mind, that incidents that occur while you’re under the influence of illegal drugs or alcohol are generally excluded.
Who offers the best policy?
The best way to find out is by visiting our travel insurance hub. With around 239 policies to compare from, you’re bound to find one that ticks all the right boxes for you.
How do I make a claim?
We really hope that your holiday runs smoothly and you won’t need to make an insurance claim. But hiccups happen, so here’s how to prepare for a worst case scenario....
Before you go
- Inform your insurer of any pre-existing medical conditions and risky activities you may be doing overseas, so they can adjust your policy for optimal coverage.
- Print out and store a hard copy of your policy, including all the Ts and Cs.
While you’re there
- Be safe and vigilant of your surroundings, and don’t leave your personal belongings unattended.
- Keep receipts of all your holiday purchases, just in case you need to provide proof in a future claim.
- Report any criminal incidents to the police, always asking for copies of statements and reports at the station.
Making your claim
Travel insurance claims involve filling out a detailed form, and submitting it with relevant supporting documentation. After a claim has been sent to the insurer, processing can take a few weeks.