DO I NEED TRAVEL INSURANCE?
To put it simply, yes. Is it simple? Well...no.
I should start by saying I am not an insurance expert and this article is intended only as an opinion piece based on what I’ve learned. Do your own research and find out more for yourself.
Insurance is one of those annoying travel costs, because you do not appear to get anything for your money until something happens. It is a gamble, however the stakes when you lose are often vastly more than you expect. Luckily for me, but unfortunately for this article, I have only ever had to make one claim in my time of travel and that was because a cyclone rolled into Rarotonga just as we were heading there. The claim was only for a night of accommodation we missed out on and was paid quickly and easily.
However, I still make sure I have it for every trip I go on and this is why:
If it isn’t at the top of your list, then it should be. Losing your luggage or having your camera stolen is nothing compared to paying a life-crippling bill to get adequate medical care. I want to be confident my insurance covers the cost of getting me to a decent hospital in whatever state I am in.
A lot of travel insurers will cover you for “Unlimited emergency overseas medical assistance & hospital expenses” but it pays to check your limit. It is very easy to hit a $100,000 when you’re in an overseas hospital and they won’t care what kind of medical cover you have at home.
There are exceptions with reciprocal healthcare agreements between certain countries. New Zealand, Australia and the United Kingdom, for example, have such an agreement. You should check to see if your country has an agreement with wherever you are travelling to, but I still recommend having travel insurance to cover you for other emergencies.
You should also check your insurance provider will cover emergency rescue and evacuation home.
Also keep in mind, pre-existing medical conditions are rarely covered.
Funeral cover and bringing my remains home
If this world finally gets lucky enough to knock me off, I want to know that the cost of getting my body back to New Zealand will be covered. I am sure the people closest to me will have enough on their minds without worrying about that as well.
This is usually where a lot of travel insurance gets murky. There are a lot of exclusions and you should check them before you travel so you know.
Many exclusions will be based on the status of the country at the time insurance was purchased. For example, if you are travelling into a zone that has a travel warning due to violent protests, you may not be covered for any disruptions caused by events covered by that warning. You will need to shop around for cover, pay a larger amount to be covered, or accept the risks, but it pays to understand them and know they exist before doing so.
Here are a few common exclusions.
- Dissolution of a travel operator. You have to be careful you understand the difference between Travel service provider, travel agent, tour wholesaler, tour operator or booking agent. This is something you need to check with your insurer.
- Death of a family member who lives outside your country of residence or due to a previously known medical condition.
- Breaking up with your travel partner
- Operating a rental car illegally
- Cancellation or delays in scheduled transport under certain conditions
- Acts of terror
- Acts of military movement
The list goes on...
I travel with my laptop and my camera. While they’re not terribly expensive pieces of equipment, the cost of replacing them if they're damaged or stolen would put a few airfares worth of dent in my travel fund. Not to mention all my other gear. I look for insurance that can get me up and going again as quickly as possible.
You will need to check the maximum dollar amount paid for individual items. For example, some insurers will pay $500 for a stolen laptop and a similar amount for a camera. If you want a like-for-like replacement, you will need to increase the individual item cover.
You also need to take all reasonable care of your items. Leaving them in a car overnight, even if it is locked, will likely get your claim rejected. Check your insurer's requirements.
Many insurers will also provide compensation for baggage that disappears into the black hole of the airport luggage handling. This amount will vary, so if you have a lot of expensive clothes, make sure you have adequate cover for them.
I like to know if I’m covered in the event I’m found liable for damages while I am travelling.
Rental car excess cover
If you’ve ever rented a car, then you’ll know the drill. You check the website and they tell you the cost is $22 a day, then in the next sentence they remind you the excess if you crash is $4000, however if you purchase their "super premium reduced excess cover" for an extra $19 a day the excess drops to $500.
Yeah, piss off. While it is an inconvenience, and you need to have the available cash to cover it, travel insurance can cover part of the excess, usually for significantly less than the rental companies. Check the amount of excess they cover while purchasing it. Do not wait until after you’ve crashed to find they only cover half of it. This can save you money on rental cars, but as I mentioned, you may have to have the available money to cover it for the interim.
Things to note
- Alcohol and Drugs Exclusions. What is often hidden in the fine print, is that many insurers will not pay for any claim resulting directly or indirectly from being under the influence of any intoxicating liquor or drugs except those prescribed to you by a medical adviser. So if you’re pissed, fall down some stairs and end up in hospital, you’re not covered.
- Purchasing before you leave vs after you’ve left. You will need to make sure your insurer knows if you have left already as this changes your policy agreement. Do not try to buy it after you’ve left and then hope they don't notice. They will.
- If you’re going to make a claim, tell your insurer asap. Check their PDS for more detail.
- Keep everything. All receipts, all information packs, get names and dates and addresses and costs. Make sure you have the paper trail for everything.
- Read the fine print. I know, insurance companies love to throw in a bunch of legal bullshit like spending three pages explaining who You are, who The Company is and the difference between Tour Operator and Tour Guide. But once you’ve managed to get through that, then you’ll be better off. They have contact centre teams who exist only to provide you with this information.
- Check how long you can travel for? For example, some credit cards offer travel insurance, however will only cover for a maximum of three months.
- Does it cover me for motorbike accidents? A lot of people want to hire scooters while they’re away but many travel insurers will not cover motorcycle accidents. Check this before you go.
- Adventure sports cover. If you’re going skydiving, see if you’re covered. Be aware of the risks. Same goes with diving, snowboarding and rock climbing. The fun police out in full force.
Now as I mentioned, I am not allowed to recommend you a product. All I can do is tell you what i use.
I have travel insurance covered by my credit card with Commonwealth Bank, here in Australia. For a lot of my travel, such to New Zealand or the United Kingdom, this has been adequate. However if I am travelling somewhere a little more remote I pay more attention.
There are a number of sites around that offer product comparisons in Australia, such as Compare the Market. Of course reading reviews of insurers is like asking people about politics. People either sing their praises or want to see them burnt at the stake.
When I travel and want good insurance cover, I use World Nomads. They have been a solid operator for a number of years and have been recommended to me by travellers I have spoken to. They have products that can be extended while away, and have cover for those of us who love some adventure. They also allow you to purchase insurance after you have left the country and extend it through their members website.
Definitely look into them and, if you like what you find, use the details below to get a quote. You’ll be helping to keep this site up and running.