Do I need travel insurance?

With restrictions on travel having eased for certain countries, you might be looking forward to a well-earned getaway this summer.

As you prepare for your holidays, one thing you may be considering is whether to get travel insurance. Here, we explain how it works, and why it’s essential.

What is travel insurance and do I need it?

Travel insurance is a type of insurance policy that covers major mishaps and accidents while you’re travelling, either domestically or abroad. Even the best-planned trips can be thrown into disarray if something unexpected happens, such as your baggage going missing, or if you have an accident and need medical treatment while you’re away, and travel insurance is designed to refund you for any costs that should arise.

What does travel insurance cover?

Travel insurance policies can vary widely in terms of the level of cover they provide and what is and isn’t included, so it’s vital to read the small print carefully so you don’t have any nasty surprises if you need to make a claim. Here are some of the things most policies cover:

Money and personal belongings

Travel insurance will typically cover you for any personal possessions that may be lost, destroyed or stolen from you while travelling, meaning you will be refunded for missing money or for the value of missing belongings.

There are limits to this, however. The maximum value per item that you can claim is usually between £200 and £500, for both individual belongings and cash. Keep this in mind when packing expensive gadgets or jewellery, and consider getting these insured separately. For the same reason, it’s a good idea not to carry too much cash on you at once while away. There will also be an overall limit on the amount you can claim for money and personal belongings overall, usually around £1500.

Emergency medical cover

Hospital bills vary widely depending on which country you’re visiting, and they can be notoriously expensive in places such as the United States. Medical cover will take care of these costs, should you happen to get sick or injured while abroad.

If you have European Health Insurance Card (or EHIC), then you will be entitled to state medical care in all European Union countries. This means you will receive the same level of care that would be available to a local resident. If your EHIC expires, or has expired already, then you can apply for a UK Global Health Insurance Card (or GHIC). Despite the name this still only applies within EU countries, not worldwide. Before 1 January 2021, an EHIC or GHIC would also cover you in some non-EU countries including Iceland, Liechtenstein, Norway and Switzerland, but now neither card will cover UK citizens visiting these countries. Find out more about the GHIC in our article Everything you need to know about the Global Health Insurance Card.

Bear in mind that state medical care works differently abroad, so the EHIC or GHIC might not cover all of your bills if you would normally be expected to pay for care in that country. It also won’t cover repatriation costs. Therefore, it’s still essential to have travel insurance even if you already have an EHIC or GHIC. Despite the name, they don’t technically count as insurance policies, so you won’t be considered double-insured if you have travel insurance in addition to a card.

It’s important to be completely honest about your medical history and any pre-existing conditions you might have when applying for travel insurance. If you are not, then it will put your cover in jeopardy and your insurer may refuse to payout.

Cancellation, curtailment, disruptions and missed departure

This feature will cover you if you have to cancel or cut short your holiday for reasons such as illness, bereavement, delays or cancellations to your flight or train, or similar emergencies. It may cover missed departures for reasons such as unexpected traffic, breakdowns and other delays. Some policies will also cover disruptions to your living arrangements, such as your accommodation falling through at the last second.

Different insurers will accept different circumstances as suitable grounds for a payout, so you should be sure to check the terms and conditions carefully and see exactly what is covered. For example, it would be a good idea to make sure that your insurer will accept catching COVID-19 as a reason for cancellation.

Personal liability

Personal liability will cover you for any legal bills that you incur on your travels, should any happen to arise (for example if you were to injure someone by accident or damage their property).

What are the different types of travel insurance?

The type of cover you will need depends on a few things.

Where you’re going: Depending on your holiday destination, you’ll either need UK cover, European cover or worldwide cover. Bear in mind that these are defined differently between insurers. For example, some companies include certain African countries in their European cover, while some do not include the United States in their worldwide cover. It’s always wise to read over your policy carefully before buying.

Who you’re going with: Different plans are available for individuals, couples and families. Getting a couple or family plan is typically better value than getting separate insurance policies for each person individually.

How many trips you will be making in the next year: If you’re only planning on going away once or twice, you might decide to opt for single-trip cover for each occasion. Any more than this and it may be worthwhile getting annual travel insurance, which will cover any trips you make over the next 12 months.

Does it matter what I’m doing while travelling?

Holidays based around particular activities are often covered by special travel insurance policies, which account for specific mishaps related to what it is you’re doing. For instance, special travel insurance policies are offered for winter sports and ski holidays that cover cancellations or closure due to bad weather or avalanches. Another example would be cruise travel insurance, which would offer a payout if you were confined to your cabin for medical reasons.

If your holiday revolves around a particular concept like a cruise or a certain activity like winter sports then it would be worth seeing if any specialist travel insurance policies are available.

Do I need travel insurance if I’m travelling in the UK?

It’s probably worth getting travel insurance even if you don’t intend to leave the UK on your holidays. Most of the scenarios that travel insurance covers can still occur on domestic trips after all.

Bear in mind that UK travel insurance generally won’t cover staying with family, or holidays within a 50-mile radius of your home. Your stay will also usually need to be pre-booked and last more than two or three nights in order to qualify.

Do I already have travel insurance?

You might already have travel insurance with your packaged bank account or credit card, so it’s worth double-checking if you’re uncertain. If you do, then look at the terms carefully and make sure that it covers everything that you’re concerned about.

It’s very important to make sure that you don’t already have travel insurance before taking out a new policy, as being “double-insured” can make claiming difficult and much slower. If you try to make a claim while double-insured, then each insurer will only have to pay a certain share of the total amount, even if you have been paying full premiums to one or both. Documents for your policy will include a “contribution clause” that outlines exactly how much the insurer will pay in this situation.

Finally...

If you haven’t yet bought travel insurance for any trips you might be planning this year, then it is a very good idea to consider it, even if you’re staying within the UK. Travel insurance is usually extremely affordable given the amount of protection that it provides, and can greatly reduce the impact of any number of stressful situations that could occur on your travels. You can find out more about travel insurance, where to buy, and how to keep costs to a minimum in our article Travel Insurance for over 50s.

Has travel insurance ever come in handy on your holiday? Do you have any tips for people searching for a policy? If so, we’d be interested in hearing from you. You can join the money conversation on the Rest Less community or leave a comment below.

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