So what is fully comprehensive travel insurance – and do you need it? Lets talk about what is covered by a typical comprehensive travel insurance – quite lot in fact. Your typical policy will cover you for
1. Loss of deposits if you have to cancel the trip before you even leave home – in case you or your relatives become ill or worse – is the usual scenario – but some policies will even cover you if you unexpectedly lose your job or a natural disaster occurs. This is definitely worth having if you tend to pre-pay a lot of your holiday expenses – or if you book a long time in advance to secure the best deal. The trick is to ensure that you take out the insurance cover at the time of booking!
2. Overseas medical. This is the big one for most people – particularly if you are travelling to the US with their frighteningly high medical costs. Cover should include ambulances and evacuation home – as well as funeral arrangements. Double check if cover will include things like dental or whether they will want to cover that broken leg if you are involved in skiing, water sports or anything else which might be counted as “dangerous”. Along with actually covering your medical costs a good policy should offer a toll-free line to call for help with translations and general advice. You may also get a daily allowance of cash for local expenses while in hospital.
3. Additional costs such as cancelling tours and extra accommodation if something does happen to one of you -this insurance cover will also cover your travel companions.
4. Accidental death. This is straightforward cover – if you die either on holiday or from injuries while you were on holiday. The accidental death cover from travel insurance is paid out to your estate so make sure your will is up to date before you go off on holiday!
5. Permanent Disability – this is similar benefit – you are injuried on holiday and get a payment. Check what is or is not covered though – loss of sight may be covered by permanent loss of hearing may not. Loss of a hand may count – but loss of a finger may not. Be clear what is and is not covered in disability before you decide whether its worth the premium.
6. Loss of Income – this will cover you income if you can’t work for an extended period of time after returning home – often 30 days. This may or may not be valuable to you depending on whether you have sick leave provisions. If you are self-employed or in a high-paying job check exactly what amount of income is covered. Cheap comprehensive travel insurance probably won’t cover this item.
7. Travel documents, credit cards and traveller’s cheques (does anyone ever use those?) This covers the cost of replacing lost or stolen documents – which can add up to quite a lot of faxes and expensive overseas phone calls – or even changes to travel plans if you have to go to a bank or Embassy not in the local area.
8. Theft of cash – usually a token amount – around $200 – if you are carrying large amount of cash consider yourself as uninsured and take the requisite precautions.
9. Personal effects and luggage. These will include items such as cameras, phones, computers and other expensive electronics that we increasingly travel with – but often you will have to declare these items before you go and they may be subject to a lower limit and higher deductible. Also double check the cover on unusual items e.g. musical instruments and sports gear. If your luggage is lost or delayed by your airline you may also be able to claim an allowance for buying the necessities of life until the bags catch up with you.
10. Alternative Transport Expenses. If you el-cheapo carrier doesn’t run on the schedule claimed -then this insurance will still get you to the special event on time by paying for alternative transport and accommodation bookings.
11. Personal liability – comprehensive travel insurance will cover you if some other party decides to sue you for whatever reason.
12. Rental Vehicle cover. This will cover the sometimes large excesses charged by rental car companies if you do lose, damage or crash your rental car.
Whether you need all this cover really is a very personal decision. Some insurance particularly in the US is critical (liability and medical) – but in much of South America -for example – you could pay less for the best private hospital in the country than you would at a mid-range hotel. If you don’t have much of value with you in terms of luggage – there is no real point in insuring it for many thousands of dollar.