Travel insurance is one big thing that everybody hates paying for. It’s that part of your journey that (hopefully) never gets used and takes a huge chunk out of your budget, meaning that you can’t do quite as much as you originally planned to do. This page offers advice on why it is necessary and what you should be looking for when you choose your policy. If you are looking to buy travel insurance immediately, you might also be interested in reading my post regarding the best travel insurance policy that is immediately available online.
What is travel insurance?
Travel insurance is an insurance policy that you take out with a company in order to cover yourself for a period of time that you are away from your home country. If you have a single trip policy, it will usually expire when you return to your home country. It is also often necessary to be in your home country at the time of purchase, so it is something that you must think about before you leave on your trip (although most companies allow you to extend your policy while away if you contact them before the policy expires). If you are already outside of your own country and wish to purchase travel insurance immediately, find out which travel insurance company I use.
What does travel insurance cover?
Depending on what policy you get, travel insurance typically covers:
- Cancellation- If the cancellation is unavoidable and out of your control, you receive financial recuperation for travel, accommodation, and course expenses that you have paid for before departure. If you pay for something and then decide you don’t want to do it anymore, it will not be covered.
- Curtailment- Cover for travel, accommodation, and course expenses that have been paid for but not used due to you returning home earlier than planned because of accidental injury or serious illness. Curtailment expenses may also cover expenses not used due to the loss of an immediate relative or death of yourself(!).
- Emergency Medical Expenses- This is the most important part of a travel insurance policy and covers emergency medical assistance and treatment (read more about this below).
- Loss of Passport / Travel Documents- This covers reasonable accommodation and travel costs incurred as a result of a lost or stolen passport that would have been otherwise unnecessary.
- Baggage and Personal Belongings- This covers damage, theft, or loss of personal belongings.
- Personal Liability- Coverage of legal expenses and legal liability for damages caused by you in an accidental situation during your trip. Ideally this should be hundreds of thousands of pounds, if not more, as legal expenses can be high.
- Financial Failure Protection- Coverage in the event that a service provider you have used goes into liquidation before you are able to use their services that you have paid for.
What should I be looking for in my policy?
The most important part of a travel insurance policy is the medical expenses. Consider a realistic scenario of walking down a flight of stairs and tripping. You fall a long way and you suffer several broken bones, including your ribs, which then puncture your lungs. This isn’t meant to scare you, but it could happen anywhere, even where you are now. You get rushed to hospital and have to spend a week recuperating and being patched up. Your bills will be extortionate. In 2011 I spent two nights in a French hospital and it cost me over €1,000 a night for the use of the hospital bed, despite the fact that the only treatment that they were giving me was bed rest and a lack of food. Accidental medical expenses are the bills that you will not be able to pay on your travellers budget. Typically, insurance companies cover you for up to £1,000,000 and you should not take a policy from a company which only covers medical expenses of a few thousand pounds.
It is also essential to ensure that you get a travel insurance policy that covers emergency rescue. My French accident involved transport in a sledge, a skidoo, and an ambulance that totalled charges (to my insurance company) of over €1,000. Typically you want emergency rescue cover that exceeds tens or hundreds of thousands of pounds. If you stumble of a cliff or get lost in the mountains, search and rescue helicopters aren’t cheap and you don’t want that bill coming through your letterbox.
Every policy has an excess. An excess is the amount of money that you have to pay in the instance of each claim. For example, if your policy has an excess of £150 and you make a claim of £1000, you will pay £150 whilst your insurance company pays the remaining £850. When most people think of travel insurance, they think about covering the value of their personal items. However, most insurance companies apply the excess per item. Thus if you were to lose a bag of clothing, you would have to pay the first £150 of each item (if your excess is £150). Most people do not take a lot of clothing valued at over £150 a piece, so it is unlikely that this section of the cover would be useful to most people unless they had a policy with no excess. Policies without excesses are very expensive, so pay attention to the excess of each claim in your policy wording.
What do travel insurance policies not cover?
Check your policy carefully because you are normally not covered for:
- Pre-existing medical conditions
- Deliberately putting yourself in danger
- Incidents involving alcohol or drugs
- HIV or STD’s
- Adventure sports
- High value electrical items
As standard practice, adventure sports are often not covered in your policy. If you want these activities to be covered, you will often have to pay a premium. Categorisation of adventure sports will vary by company and may include anything with an increased risk of injury, ranging from off piste skiing and parachuting through to hiking and volleyball. It is not difficult to find a policy that covers adventure sports; you simply have to make sure that you purchase the correct policy.
High value electrical items such as cameras or laptops will normally have a maximum payout in addition to an excess. When combined, the amount that you can claim in the event of theft or loss is minimal and to counteract this, you should consider buying a policy add on if you are taking expensive equipment with you.
Deliberately putting yourself in danger is normally defined by the company in question. If you are on an organised safari and get attacked by a lion, you should be covered. If you are out walking in the bush and decide to follow a group of elephants that you stumble upon, you probably aren’t covered when you end up gored against a tree.
How do I make a claim?
For small medical claims, you normally pay the bills yourself and keep hold of the receipts. You then send copies of these to your insurer and they should issue you with a cheque totalling the costs, less the excess. It is important to contact your insurance company as soon as possible following the medical treatment, although quite often, you have up to a year to submit the documentation.
For large medical claims, your insurance company should be contacted as soon as possible to make them aware of the situation. They should then agree with the hospital to cover all medical expenses and you shouldn’t have to worry about it anymore. It is useful to have travel insurance documents to hand because certain countries may be hesitant to treat you without the assurance that they will be paid. As long as you are carrying an internationally recognised identity document (such as a passport), you should receive treatment because they have your details and know that they can chase you up. I had a problem in South Korea when I split my head open and had no documents on me. I had to walk to a friends house and collect my identity card before they would stitch me up and stop the blood flow. By this time, I had lost consciousness and my friends had to carry me back to the hospital.
If you are making a claim on lost items, always report it to the police and get a police report. Insurance companies will often not pay out for theft unless claims are accompanied by an official document.
If you wish to claim on anything else, always keep copies of your receipts. This is the way to prove to the insurance company how much everything costs and get the correct payout.
Are all insurance companies evil people who want to take all my money?
Evil? Hopefully not. Do they want to take all of your money? Quite possibly. At the end of the day, they are a business and their aim is to make money. If you have all appropriate documentation and do not attempt to scam them, you will normally get what is agreed. I have paid lots of money to travel insurance companies in my life and most of it has been unused. However, I do not resent this and have never attempted to scam an insurance company because on the rare occasion that I have needed them, they have been there for me and provided me with what was outlined at the time I bought the policy. The only three claims that I have made to date were:
- Around $170 (£40: £110 less £70 excess) after having my wallet lifted near Kilimanjaro.
- Around €6,000 (£Thousands: £5,000 less £65 excess) for rescue and ‘recovery’ after suffering a broken back in a skiing accident.
- Around ₩300,000 (£75: £175 less £100 excess) for stitches and injections after splitting my head open in South Korea.
Where should I buy travel insurance?
All things considered, travel insurance is an absolute must. If you are looking for the cheapest possible policy, you can use online comparison websites such as money supermarket (UK residents only) to find long stay cover for a small price. However, some of the policies are not that great and they may catch you out in the small print. For this reason, I refrain from recommending any of these companies. If you are looking for the budget option, please go ahead and use them. I hope (and assume) that everything will be OK. I have used budget travel insurance policies in the past without ever having to claim from them, so I do not know how easy they are to work with.
From my years of travelling, I have had a lot of experience researching travel insurance policies and as a student, I often used STA Travel. I found their policies to be comprehensive and claims easy to make.
I recently decided that World Nomads travel insurance is the best policy to use. In brief, I found them to be slightly better value than STA (who are still a great company). They do exactly what they say they will do and watch your back when you are abroad. Their policies are among the most comprehensive available on the web and you can tailor your policy to your exact needs. This includes applying any extra add-ons such as adventure sports or high value electrical equipment. Lonely Planet, Rough Guides, and Travel Fish all recommend them, as do I. Unlike most companies, they also allow you to purchase an insurance policy after you have left home, or to extend an existing policy if you decide to stay away longer. If you are interested in learning more, I can tell you lots more about why I recommend World Nomads if you care to listen.
I would like to ask that you please consider using the World Nomads travel insurance booking widget below to get a quote and reserve your insurance. This is an affiliate link which means that a percentage of the sale will be paid to Great Big Scary World and help to keep this site functioning. Using this widget will cost you the exact same price that you pay by going directly to their site. However, by accessing a quote from this page, you will help me to keep producing material on this site for free. I’m not going to be disappointed if you choose to take your business elsewhere, however I would appreciate it if you could tell me about any better travel insurance policies that you find. If I agree, I will share them with the world.