7 travel insurance misconceptions you need to know about

Now don’t get me wrong. I’m not a pessimist who leaves on a holiday thinking I’ll miss my flight, lose my bags or have an accident. I just feel more secure taking out travel insurance so I don’t need to worry about anything while I’m travelling.

But just when I thought I had it all under control I was in for a rude shock after I lost my purse at a restaurant in Bali and my travel insurance company rejected my claim saying they don’t cover loss of unattended baggage! It was then that I realised there were all sorts of exclusions to my policy that I had no idea about. Carelessness was just one of them.

So that you don’t end up having the same experience as me, I’ve listed 7 common travel insurance misconceptions that were only cleared up after carefully combing through the policy fine print:

1. You can claim the total cost for any single item

Let me explain this with an example. Say you’ve just bought an expensive jacket at SaksFifthAvenue and it somehow gets damaged along with your suitcase on your flight home from LA. Now even if you have a total cover of $10,000 for luggage and personal effects, there will be a limit to how much you can claim for any individual item. So even if the jacket is brand new, cost you $1,500 and you have the receipt, it’s possible that you’d only be eligible to claim $500 for it as this was the maximum amount for any one item.    

2. You can claim lost or stolen cash

Well, technically you can claim lost or stolen cash, but the total limit for cash cover is generally low, usually around just $100. And if like me you left your purse unattended in a public place or an unmanned vehicle, you will not even be able to claim for the minimum amount.

Another important thing to remember (which also holds true for point number 1) is that if you’ve lost something, you’ve got report it to the police immediately (usually within 24 hours of the incident) because your insurance provider won’t simply take your word for it. You’ll need to support your claim with official documents and proof of ownership.

3. You’re covered for all accidents

Accidents do happen, and often when on holiday the thrill of the moment trumps better judgement. Apparently, travel insurance companies don’t share the love for reckless adventure. So if you’re making a claim for an accident, and there was any amount of alcohol involved, your claim will be rejected.

For instance, I found that even though you may have paid extra for a particular type of cover like snow cover, if you’re found to be under the slightest influence of alcohol or drugs, and you have a ski accident, your travel insurance company will give you nothing but their deepest sympathy.     

4. All pregnant women are covered up to 26 weeks

Babymoons are a great idea and fortunately, many travel insurance providers offer pregnancy cover right up until 26 weeks. But reading the fine print I realised that not all pregnancies are equal to insurance providers.

For instance, if you’ve suffered complications during a previous pregnancy, you’re pregnant with twins or multiples, or yours is a medically assisted pregnancy, you may not be covered. Pregnancy cover also generally does not include childbirth or postnatal care. So even if you’re covered, if you have a premature delivery while you’re travelling, your baby will most likely not be covered under your policy.

5. Your bags are safe with the hotel concierge

Haven’t we all done this at various times? Left our bags with the concierge after checking out to explore the city. I always thought it was a great idea. There’s only one small problem. Just like forgetting your wallet in a store, leaving your jacket in a rented car and hanging your bag behind your chair at a restaurant only to find it gone, this too is considered as leaving your bags ‘unattended’ and it’s likely any insurance claim will be rejected.

6. You’ll be reimbursed for cancellation costs in case of a delayed visa

Yes, holiday cancellation costs are covered under most comprehensive travel insurance policies. But it’s important to know under what circumstances you can or cannot claim these costs. For example, I was surprised to read that not being able to get a visa in time is not an ‘unforeseen circumstance’ and your travel insurance company will not accept a claim based on that.

7. Your insurance provider will pay for rescheduling your travel plans in case of a terrorist attack

While many travel insurance companies do cover medical emergencies caused due to terror attacks, most will not pay you for the cost of cancellation or rescheduling your trip. For instance, after the recent Brussels bombing, while most travel insurance companies came forward to offer medical help to travellers caught up in the attacks, they had a number of limitations and restrictions for covering cancellations, lost deposits and alternative travel expenses. 

Overall, it's important to remember that every insurance provider will offer different levels of cover and it's very important that you read the fine print of your policy so you know exactly what you're covered for.