Travel Insurance - getting the best deal
By Kate Saines
Strikes, volcanic ash clouds, more strikes. the UK travel industry has certainly had a rough time of it this year, frequently leaving the plans of thousands of holidaymakers in disarray.
Despite this, a large number of Britons still choose not to protect themselves from potential calamities and refuse to take out travel insurance when going abroad.
According to price comparison website Confused.com, seven per cent of us Brits will holiday without travel insurance despite all the disruptions that have ensued so far this year.
Steve Williams, head of travel insurance at the website, said: "It's a concern that some people still think travel insurance is a waste of time, despite recent events.
"Travel insurance covers eventualities including delays and cancelled holidays. It should not be overlooked."
Purchasing travel insurance isn't rocket science and it usually works out cheaper than many people expect, so there is really little excuse to go uncovered when taking a trip abroad.
To make things even easier, myfinances has collected some nuggets of wisdom on how to find a good travel insurance deal without paying over the odds.
Where to find the policy
There is such a huge array of deals on the market that it is quite likely that you will need the holiday just to get over the task of exploring the travel insurance minefield.
For this reason it's very easy to see why people simply sign up to the policies offered by their travel agent or airline when booking the holiday.
While this is perfectly acceptable route for those favouring convenience over cost, it might not suit the more budget-conscious traveller.
And that's not the only pitfall to look out for.
Consumer group Which? carried out an investigation into these policies and discovered that not only were many of the travel agents' deals poor value for money but they did not necessarily provide adequate cover.
Researchers visited 29 travel agents and found all of them were 'uncompetitive' on price with one quoting £80.99 for insurance on a two-week trip to Spain for two.
According to Which?, researchers could have got a similar policy for £20 by choosing one of its recommended travel insurance policies.
When it came to the nitty gritty of the policy, 17 travel agents did not provide basic details about the policy, few checked the cover would be sufficient for the customer and six even failed to enquire about pre-existing medical conditions.
Rochelle Turner, head of research for Which? Holiday, said: "Not surprisingly, you expect travel agents to be experts in all aspects of booking a holiday, but our research shows that's not always the case when it comes to insurance."
And she added: "The recent disruption to flights has demonstrated just how important it is to have adequate cover."
Which? was not alone in its concerns. Moneysupermarket.com found travel insurance was up to 211 per cent more expensive if bought through an airline, tour operator or travel agent.
The price comparison website, not surprisingly, endorses scouring the market to find the best deal.
It reckons a family of four travelling to Spain for a week could cover themselves for as little as £10.45 or an average of £11.84 by doing their homework and finding their own policy independent of their holiday agent.
As an added bonus, by choosing your own policy you can see exactly what it covers.
Bob Atkinson, travel expert at Moneysupermarket, said: "By taking the time to shop around for travel insurance, Brits can jet away with the peace of mind that they know exactly what their policy covers them for while abroad, as well as the knowledge there are probably a few extra pennies lining their pockets."
What type of cover should I purchase?
If you only plan to take one foreign holiday over the next year, Which? advises the purchase of a single trip insurance policy. This is a one-off insurance plan covering one holiday only. More frequent travellers - those taking more than two or three trips in a year - are urged to take out an annual travel insurance policy.
Moneysupermarket suggests ensuring any policy you buy covers for, at the very least, £2 million for medical expenses, £1 million personal liability, £3,000 for cancellations, £1,500 for your baggage and £250 for cash.
It suggests policy excesses should not exceed £100 and that they should include cover for scheduled airline and end supplier (for example hotels or transfers) failure and delay cover.
Bob Atkinson said: "When taking out insurance, your cancellation cover should be enough to include your flights as well as other expenses such as car hire and accommodation.
"Cover for airline failure is an important consideration too for travellers."
As mentioned, the problems caused by ash clouds earlier this year have prompted many insurers to offer 'add-ons' to their policies which give customers cover for closure of airspace and airports.
Aviva is one such insurer, and is offering this optional add-on from June 1st to new customers or those renewing their policies. It costs £5 per insured person for a single trip or £10 on an annual trip policy.
It's not just ash cloud which this addition is designed for. Jerry Finch, travel manager at Aviva, said: "We have broadened our insurance cover beyond the impact of volcanic ash on flights to include any reason for airspace, port or airport closure.
"This would include examples such as terrorism, prevention of terrorism or even a pandemic situation, such as bird flu."
Which? also suggests checking you are not covered for your holiday elsewhere. For example, your belongings could already be covered on your home insurance under the all-risks or personal possession cover. This would mean you would not need baggage cover on your travel policy.
Indeed if you are paying your bank to provide you with a packaged bank account which includes travel insurance, check the details of this to see if it covers you for your holiday.
Some credit cards also offer this service, but Which? advises you make sure the policy is comprehensive - so read the details carefully.
What factors will affect my policy?
Increasing life-expectancy means the over-65s seem to be becoming the age group with the greatest passion and ability to travel.
Yet the Post Office found that 14 per cent of people aged 65 plus have struggled to get insurance. This is because insurers don't really like taking on the increased risk of insuring the older generations.
The good news is that this situation seems to be slowly changing.
In September last year the Post Office itself extended its multi-trip insurance policy to cater for this age group. And there are plenty of other deals available for those willing to do some research.
Which? has a list of best buy policies which cover the over-65s, and even recommends deals which cover the over 80s, with prices starting at £11 or £12 per person for a single trip policy to Europe.
There are also specialist insurers such as Age Concern and Saga who tailor deals for mature holidaymakers.
Which? also offers advice to those people with pre-existing medical conditions who may find many insurers will not cover them for those conditions.
It says you should always be honest about such conditions and discuss them with the insurer. Its best buy list provides names of insurers who are sympathetic to travellers in these situations.
When to take out the policy?
Finally, it might sound obvious, but make sure you take out your policy before you go on holiday. You will not be allowed to claim for a cancelled flight if you took the policy out after the flight was stopped.
Bob Atkinson of Moneysupermarket said: "I would always urge holidaymakers to buy a policy as soon as their travel plans are confirmed, and the volcanic ash problems which caused disruption to thousands of travellers, as well as the threat of strikes by BA cabin crew, highlight the importance of this."
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