How much travel insurance do you need?
This week saw the launch of a new travel insurance policy offering cover for strikes, the collapse of a travel firm or airline, hijack, and earthquake.
But how much travel insurance cover do you really need?
The new policy from specialist firm Insurefor is claimed to be one of the most comprehensive travel insurance policies available.
Antony Martin, managing director of Insurefor, warned consumers not to be caught out by a policy which only covers for the basics.
"All our policies now cover elements such as Supplier Failure and redundancy as standard, both of which are vital in the current unstable economic climate," he said.
He explained the policy also allowed consumers to add or take away elements of cover depending on their needs.
However, are such policies offering too much cover?
Steve Williams, head of travel insurance at confused.com, said: "All singing, all dancing policies can cost more. If you don't need the extra cover, then don't have it.
"I would say save never over-insure, but have enough cover for your needs.
"If you over-insure you are paying more than you need to, but you will not be able to claim."
He explained the essential cover you need is for baggage, medical expenses and cancellation.
The general advice for travel insurance is to have £2 million cover for medical expenses, £1 million for personal liability, £3,000 for cancellations (or at least the value of the holiday) and £1,500 for baggage (again depending on how much baggage and possessions you have).
Maxine Baker, travel insurance expert at moneysupermarket.com, said: "Having comprehensive cover is crucial and without it you could be left to foot the bill for a holiday you never got to embark on.
"My advice when booking a holiday is to shop around for the best value insurance straight away and ensure that you have this in place at the same time."
Mr Williams added: "If you are unsure, then compare policies and ring up the providers, it may be possible to bolt on some extras if you need it."
If a travel firm covered by ATOL or Abta goes bust, customers will receive compensation and be flown home if they are already on holiday.
Those whose are not covered are travellers who buy flights directly from airlines.
It is estimated the number of travellers protected by ATOL has shrunk from 98 per cent in 1998 to less than 61 per cent this year.
Ms Baker said: "No-one can foresee problems such as airlines going bust or political unrest which could prevent travel to your planned destination abroad however without adequate travel insurance in place, getting compensation for any disruption could be incredibly difficult.
"When it comes to an airline going bust, you can save yourself a holiday headache and claim your money back from your credit card provider under Section 75 of the Consumer Credit Act.
"However this only applies if you have paid by credit card, for those who paid by debit card there is no such certainty."
However, paying by credit card often involves an extra fee.
Mr Williams also urged people to think about how they protect their belongings on their home insurance or travel insurance - weighing up the different levels of excess and the effect on a contents policy of making a claim.
"If you make a claim on your contents insurance, the premiums could go up," he warned," he said.
"You also need to check items will be protected when you are away from the home."
However, for many people the problem is not excess cover, but not taking travel insurance.
"Many people are travelling without insurance, which is scary," said Mr Martin.
"The cost of travel insurance is not expensive. If you look around at aggregators like moneysupermarket.com, companies are being really competitive on price. There is no excuse for not buying travel insurance."
Mr Martin did note though that people were taking out travel insurance later as they book holidays later - and are cutting out elements such as winter sport cover and worldwide cover. to save money
"We are still seeing as many annual policies being sold but without winter cover. People are also switching from worldwide cover to just Europe."
Comparison of best value annual travel insurance
| Provider | Premium | Medical Expenses Cover* | Personal Liability Cover* | Cancellation Cover* | Baggage Cover* | Hijack* |
|---|---|---|---|---|---|---|
| Top Dog Emerald Annual Multi-Trip (31 Days Per Trip) | £23.95 | £10,000,000 | £2,000,000 | £750 | £1,000 | n/a |
| Insurewithease - Bronze Annual Multi-Trip | £23.98 | £5,000,000 | £2,000,000 | £3,000 | £1,500 | n/a |
| OUL Direct - OUL Direct Annual Multi-Trip | £25.95 | £5,000,000 | £2,000,000 | £3,000 | £1,500 | Under Cancellation Cover |
| Preferential Travel - Classic Annual Multi-Trip (31 Days Per Trip) | £27.11 | £2,000,000 | £2,000,000 | £1,000 | £1,000 | £2,000 |
| Primary Insurance - Primary Essentials Inc Baggage | £31.45 | £5,000,000 | £2,000,000 | £1,000 | £750 | £2,000 |
Insurefor.com - Standard Annual Multi-Trip |
£38.99 |
£7,500,000 |
£2,000,000 |
£2,000 |
£1,500 |
£350 |
*Benefit subject to excess
Based on male aged 24, Annual Multi Trip Worldwide
Sourced by www.moneysupermarket.com 17/06/2009
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- travel insurance
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