What is Travel Insurance?

Many of us take out holiday Travel Insurance, but few know really what it is and how it can be defined. If you know what is included, you will be able to make the most of your protection.

In general terms, holiday insurance protects a traveler holiday costs against adverse events such as cancellation and interruption and also reimburses medical expenses, the loss or damage of property and transit delays. Travelers are compensated if they have to cancel or interrupt their travel, they will also be covered should they need emergency medical treatment, medical evacuation and other situations.

The main categories of holiday Travel Insurance:

Delays and cancellation – including curtailment

Delay: This reimburses travelers for hotel, food or clothing expenses in the event of a flight delay. Some plans also cover costs associated with catching up with a cruise should another delay cause the traveler to miss embarkation.

Cancellation: Reimbursement comes into effect if travelers have booked and paid for a holiday, but are unable to embark because of personal illness or injury, death (of the individual or of a family member), adverse weather conditions, airline strikes, terrorism, bankruptcy, sudden unemployment, jury duty or by sustaining serious damage to their home causing it to be uninhabitable due to fire or flooding.

Interruption: Travel Insurance companies pay money to policy holders abroad if they have to cut short their trip due to illness, death (of the traveller or a family member), weather, airline strikes, terrorism, bankruptcy, becoming unemployed, and other adverse conditions which mean that, due to events outside the control of the holiday-maker, a trip has to be curtailed.

Medical reasons

Medical and health reasons: Reimburses medical and emergency dental costs. Almost all holiday Travel Insurance plans work by reimbursing the traveler after they have paid locally for treatment. Claims are usually paid within 7 – 10 days. Pre-existing conditions are covered by most policies if the policy is purchased within (at the most) 21 days from the date the traveler made the first payment or deposit.

Medical evacuation: This provides emergency transportation to either a local hospital in the event that the traveler is unable to get there by themselves or back to a hospital near the traveler’s place of residence. If family members are covered on the same policy they can return home also.

Death of traveler

Air Flight accident – this covers death or dismemberment during an air flight only. Usually provides the highest amount of coverage due to fairly low likelihood of this occurring.

Common carrier – Covers death or dismemberment while travelling on public transport such as a plane, ferry, train bus or taxi.

Accidental death – covers death or dismemberment at any time of your trip. Usually provides the lowest amount of coverage due to a higher risk

Loss or damage of personal effects

Baggage loss – reimburses travelers for lost, stolen or damaged personal items. This coverage is usually restricted to the duration of the trip and not confined to baggage damaged or lost by the airline. There are two policy limits, total claim and per item maximum. Some policies also place limits on the type of items that can be claimed for – such as precious jewellery, laptops and sporting goods

Rental Car damage – Reimburses travelers for damage or loss to a rental vehicle. It is designed to allow the traveler to decline collision damage waiver (CDW) coverage offered by the car rental companies. Liability coverage should still be purchased through the car rental company. Rental Car Damage coverage is also often included with the credit card used to pay for the car rental which is often matches the coverage provided in the policy.

Assistance services – provides a 24-hour collect telephone advice and assistance service to travelers. This service can be used anytime a traveler needs advice. Make sure you don’t leave home without it.

In conclusion

holiday Travel Insurance is the one product in the modern Travel Insurance saturated world that really is essential. You will not regret taking it out, but not being insured for your travel mishaps is a source of huge regret for far too many holiday-makers every year

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