Going away is one of the highlights of the year, and none of us really wants to think about something going wrong while we are enjoying sun, sea and sangria.
But there’s always a chance that some of us will run into some sort of problem while we are away, whether that is lost luggage, delayed or cancelled flights, or a medical emergency. So getting travel insurance really is a must before you head overseas.
However, the price of policies can vary dramatically, so always compare prices to make sure you get the best value cover you can.
What does travel insurance need to cover?
It makes sense to get cover for anything that you anticipate could go wrong. So the basics would be lost luggage, delay or cancellation of your flights, needing to cancel your holiday before you go away in the case of illness or a death in close family, medical treatment while you are away, and cover for any dangerous sports or activities that you are planning on taking part in.
For medical cover, the minimum cover you should have is £1m, although some policies will go as high as £10m, and it is wise to get a higher limit if you are travelling in America or Australia, where treatment is famously expensive.
Getting cover for medical evacuation and repatriation, in case you cannot fly home on a commercial flight or without a medical professional, is wise. It’s something you should definitely include if you intend to take part in winter sports or any other activities which could lead to a serious injury.
Never assume the activity you want to undertake is covered as standard under the policy - you always need to check the terms and conditions, and buy additional cover if you need to.
Baggage cover and cancellation cover should be at least as high as the value of the baggage you are taking, and the cost of your holiday so you are not out of pocket.
Cancellation cover will usually be between £1,000 and £2,000, which for most trips will be enough, but remember to include any pre-paid trips and excursions you are planning while you are away.
If you are taking expensive items with you, such as laptops or cameras, then make sure their value is within the single item claim limit on the policy you have chosen. This is often £200-£300. Otherwise you could find yourself unable to replace them if they are lost or damaged while you are on holiday.
You should also have at least £1m of personal liability cover in case something happens and you face claims against you personally as a result.
In addition, getting some kind of catastrophe cover with your policy can be useful, so if there is a disaster while you are away that prevents you from getting home, you will be able to reclaim your additional costs.
What happens if the holiday company goes bust?
If you have booked a holiday in good faith with a company and it goes bust before you go away, you will not usually have enough cover under your insurance policy to deal with this, unless you have what is called 'Standard Airline Failure' or ‘End Supplier Failure’ as part of your cover. But this is rare, so if you want this cover you need to make sure you choose a company that offers it.
If you are away when the holiday company goes bust, then providing it is Air Travel Organisers' Licensing (ATOL) protected, which most package deals will be, then you will be able to get home as this means the Civil Aviation Authority will arrange new flights home for you.
If you are yet to leave, you should also be able to get a refund under ATOL rules, but this is not the case if you have booked your accommodation and flights separately. In this case, if you have booked your holiday on your credit card, you may be able to get your money back under Section 75 of the Consumer Credit Act.
This makes the credit card company and the provider of goods or services jointly liable if those services or goods are not provided, or are substandard and are worth more than £100 and less than £30,000.
What if my flight is delayed or cancelled?
If your flight is delayed your airline will have to provide you with a seat on a later flight, or refund your money. You have no right to expect the airline to pay for another flight with a separate airline.
If it is cancelled, then you should be entitled to food, phone calls and accommodation if the delay means you being stranded overnight. But there is a grey area here, as if the airline claims the delay is outside its control, it does not have to provide you with any compensation.
Being delayed for between eight hours and 12 hours means you should be able to claim some money back from your travel insurer. Check the terms and conditions though, as the actual length of time the delay needs to be will vary from insurer to insurer.
Catastrophe cover will help you if you suffer delays and cancellations due to major events, such as a a severe storm, but do not assume that you are covered on a standard policy without this being specifically mentioned. To be fair, in most cases, travel insurers will step in to help their customers in these instances even if the cover is not specifically offered, but do not expect it.
Annual, multi-trip or single trip travel insurance?
If you travel abroad a lot, then getting multi-trip cover will work out cheaper for you. Buying single policies each time will become expensive, and you could forget to buy it before you go, which will be a disaster.
However, if you are only going away once in a year, a single trip policy would probably be better value. In both cases, you should compare policies to make sure you are getting the best cover you can, at the best possible price. Remember, cheapest is not necessarily best.
What is an EHIC?
A European Health Insurance Card entitles EU citizens to state-funded care while travelling in the European Economic Area and Switzerland. It does not replace travel insurance, as it will not offer cover for repatriation or cancellation and so on, and you may also need to pay for some care abroad that you would get free in your own country.
As it stands, the EHIC card will only work for UK citizens up until 29 March 2019.
If you are concerned about whether your EHIC card will work after the UK leaves the EU, be aware that a standard travel insurance policy will cover you for any medical costs included in your policy.
What other type of travel insurances are available?
A family policy will offer cover for families who are travelling together, and sometimes when they are travelling apart. You may have to pay for children to be added to the policy, but again in some cases they will be allowed to be included at no extra cost to you.
When you reach age 65, travel insurers get twitchy about offering you cover, as they think you are more likely to make a claim when you travel abroad. So a number of companies have started offering policies specifically to cover this age group. Again, compare costs and cover to make sure you get what you need.
Pre-existing medical conditions
Standard policies will often exclude any pre-existing medical conditions you have, but if you need to have something covered while you are away, such as diabetes, there are companies who will do this.
Taking part in winter sports such as skiing and snowboarding are considered dangerous activities, and if you want to do this while you are away, you will need to take a policy that offers this cover.
Comprehensive cover for less
Travel insurance comes in a variety of shapes and sizes, and so does the premium you will pay. Buying your cover from your travel agent when you book may seem like a good idea, but in some cases these policies do not offer you the cover you need, and can be a lot more expensive than policies available elsewhere.
So you should make sure you compare policies to get the best deal. Do not assume that the cheapest policy is going to be the best one for you, you must be sure you can pay any excess for a claim - the higher this is, the lower the premiums - and it must also provide the cover you need.
The value of a policy is in whether a claim will be accepted and paid, so it is vital to check the terms and conditions of the policy you are looking to sign up to. Make sure you are comparing like-with-like too, as thinking your policy is better value but finding it does not have the specific item covered, or level of cover you need, is a false economy.