Travel insurance, like any other insurance, is always too expensive until you need it. Then, it miraculously turns into something of a shrewd investment. There seems to be a lot of mystery around this type of insurance and many people don't bother with it at all thinking they'll be covered by anything from their home insurance, some product provided by their bank or just by sheer luck or divine intervention. So what does this mysterious animal actually cover? Obviously specific policies and conditions vary greatly, but here's a short list of the main features.
If you or any member of your party cancel your holiday or trip due to an accident, injury or illness then the cancellation section of your travel insurance should pay out. You can also claim if your trip is delayed for more than 12 hours and you decide to abandon your holiday. As with all travel insurance, you will need to declare any pre-existing medical conditions otherwise you may find the policy is void when you most need it. (Note: World First offer specialist medical travel insurance for pre-existing conditions).
If you have to cut short your trip due to accident, illness or an emergency at home, then your policy will cover the unused portion of your holiday, perhaps a weeks' hotel accommodation and any extra expenses you are faced with when going home early.
If your flight, sea crossing, coach or train is delayed because of adverse weather conditions, breakdown, strikes or industrial action you should be able to claim for a cash benefit covering any extra costs you incur whilst stuck at the airport. Useful when travelling with children who need entertaining.
Loss, theft or damage to personal possessions
Cover if your handbag is stolen, if you're pick-pocketed or if you lose your travel documents. Most policies limit the total amount you can claim and a limit to the value of any single item, like a camera and its lens. More and more people are buying all-risks insurance on their household cover, which insures your personal belongings all year round and not just when you are on holiday abroad.
Cash & Documents
It's always wise not to carry too much cash and instead consider a pre-paid travellers' cheque card. Your insurance will cover accidental loss of cash and documents, though limits will apply and, rather sensibly, cash must be carried on you and not in your luggage.
If you lose your Passport
It could be a nightmare and happens more often than you'd think. Travel insurance will cover any reasonable extra costs for accommodation and travel expenses (no slap up meals then) and the cost of an emergency passport to enable you to carry on with your holiday.
Delayed baggage (and emergency replacement of essential items)
Of course, airlines don't lose baggage do they? But in the unlikely case that they do, you're covered. This will mean you can buy any emergency necessities like a toothbrush and some clean clothes (and have a wash).
If you get seriously ill when you're away, the bills can mount up very quickly. Travel insurance will cover most of them, although not for Spanish tummy. All policies include a 24-hour emergency medical service who you can call with any problems. Hospital confinement cover will pay you a daily cash benefit for anytime that your are admitted to hospital whilst on holiday too.
If you get very, very ill, or badly injured, travel insurance will bring you home. This is probably one of the most important sections of your policy. Would you rather be stuck in a remote hospital in Mongolia for a month following a car crash or be back home with your family around you and the good old NHS? The choice is yours.
This covers an amount to be paid to you if you suffer the physical or permanent and total loss of any limbs, your sight or are permanently diabled following an accident during your trip. Your policy will even pay out if you die.
If you have an accident and hurt someone who is not a member of your family you'll be covered for all the legal expenses and any legal liability for damages. Most policies include at least £2million of cover for personal liability.
Sports & Activities
Most policies will cover a range of sports and activities but the list varies from policy to policy and between every insurer so don't just assume you'll be covered. Separate insurance can often be purchased for specific high-risk sports (mountaineering, scuba diving, snowboarding for the over 70s or or a whole variety of things on or off the water). Cover for pre-existing medical conditions can be found by speaking to specialist travel insurers (like World First) and insurance is also available for golfers, business travellers and student backpackers (see related post) heading off for the very first time.
A policy excess is your contribution to the cost of the claim. Check your policy wording carefully and make sure you know how much the excess is. They can be as much as £200 per person, per claim, but the norm is around £60.