Beware travel insurance policies that don’t add up: check you’re covered

27 June 2017

Holidaymakers should always take out insurance to protect themselves against the worst happening. But if you’ve already got your holiday policy arranged, have you made sure it’s actually going to cover all the costs of holiday mishaps?

Financial information business Defaqto has found that many travel insurance policies don’t add up. For instance, the average two-week family holiday costs around £5,000. And yet one in five travel insurance policies only pay out to the value of £1,000 if the family is forced to cancel their holiday due to illness or injury. Indeed a few policies offer no cover whatsoever in this instance.

Travellers are also at risk when it comes to missed departures, which are not covered by 15% of single trip policies. And it gets worse when it comes to insuring your valuables – up to 25% of policies only cover £1,000 worth of lost, stolen or damaged luggage, putting expensive gadgets at risk and holidaymakers out of pocket.

Brian Brown, head of insight at Defaqto, comments: “Travel insurance policies vary greatly in the level of protection they offer for certain nightmare scenarios – with some policies providing very little cover at all. Therefore we urge holidaymakers to check their policy carefully before jetting off and ensure they have sufficient cover for situations such as delays, lost luggage and medical emergencies to avoid more than just the holiday blues on the return home.”

Avoid the pitfalls

Buying insufficient cover for your trip can be a costly mistake, so always make sure to:

  • Declare pre-existing medical conditions. If you don’t, any claim will likely be rejected.
  • Make sure you have cancellation cover that matches your trip. For instance, a round-the-world trip will require much more cover than a week in France.
  • Gather as much evidence as possible for a claim. Companies can have very high demands when it comes to accepting a claim, so make sure not to throw away any paperwork relating to the claim you’re making.
  • Check the value of your suitcase matches the policy. If you have expensive cameras, phones, and laptops, the value of your possessions could very easily exceed the policy limit.
  • Travelling to Europe? Don’t confuse EHICs with travel insurance – you need both. See Moneywise’s EHIC warning for more on this. 

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