A guide to buying that so-essential holiday insurance
Holiday insurance may not be at the forefront of our thoughts when planning a holiday in Tobago, but is a subject that is avoided at our own peril.
A reader asked about holiday insurance in the myTobago forum. A regular contributor sent us a comprehensive reply. The information he provided was so useful that I asked him to flesh it out as a main article. Whilst it may not quite replace the excitement of reading about beaches, accommodation and restaurants, it represents an extremely useful buyers guide.
The author of the article is a well-seasoned independent traveller and insurance consultant. For business reasons, he would prefer to remain anonymous.
When we go abroad for our holidays, we are only concerned with having a good time. The last thing on our mind is 'What will happen if I am ill?' or 'What if my luggage ends up in Iceland and I'm in Tobago?'
Thankfully, most holidays pass without such incidents, but, as we have all seen from the numerous TV programs, such as Holiday from Hell, Airport and Holiday Airline, things can, and do, go wrong. There's nothing you can do to avoid fate, but there is a precaution that you can take to minimise the effects of Sod's law.
Here are a few golden rules on the enthralling subject of travel insurance. Pay attention, because I'll be asking questions later.
1. The Golden Rule
Don’t travel abroad without adequate travel insurance.
The risks covered such as loss of luggage, delay, personal liability and of course medical assistance, are the kinds of occurrence guaranteed to ruin any holiday. The pain is just that little bit more bearable if you have cover and can claim some monetary recompense.
2. Don't skimp on the cover
The cheapest (sometimes free) policies offer basic cover only and seldom extend to areas such as the Caribbean. Numerous exclusions and sky-high excesses sometimes make these policies not worth the paper they are written on. If you are buying your cover through a broker (including travel agents or your flight agent) tell them that you want WORLD-WIDE cover and a comprehensive range of benefits.
Perhaps the most essential risk is the medical expenses section. If you suffer a heart attack, a stroke or have a serious accident (whilst diving, surfing, cycling, driving, horse riding, or just falling down the hotel steps in a state of relaxed euphoria) it will cost many thousands of pounds to get you home again, safe and sound. In severe cases, an air ambulance may need to be chartered in order to repatriate you. Charter flights will not carry anyone who poses a potential lawsuit to them. You may need to be flown to the USA for treatment. Could you afford the bills?
The most expensive isn't always the best either, but you generally get what you pay for with travel insurance. Stick with the well-known companies. You have less risk of having a VALID claim rejected and will have less hassle sorting things out.
As a typical example, a quality policy should offer the following levels of cover:
- Up to £5 million of medical expenses and £25,000 for personal accident (loss of a limb or sight)
- Personal liability of £2 million (in case you injure someone or damage property)
- £3,000 for loss of deposit or cancellation due to illness, injury or bereavement
- Legal expenses of £25,000
- Loss, damage or theft of personal possessions of £1,000
- £500 in cash and/or the cost of replacement documents such as passport or tickets
- Delay and missed departure (due to circumstances beyond your control e.g. rail strike) £500
- Sums, varying between £300 and £500 for the unlikely risks, such as hijacking, mugging or catastrophe (e.g. hurricane, earthquake or flood)
For a couple, this should cost around £75 for a fortnight. An annual policy, with no limit on the number of trips, but with each stay of no more than 31 days duration, should cost no more than £95.00 so, if you are planning at least two holidays each year, it can work out cheaper to have annual cover and you don’t have to worry about insurance each time you travel.
Included in my typical policy would be a 24-hour assistance help-line. Most of the reputable companies will have worldwide assistance available at the other end of a phone call. These people are experts in sorting out real problems and in making sure that your holiday isn't a complete disaster. In serious cases they will send a specialist nurse or medical team out to care for you and accompany you on your homeward journey. This type of invaluable assistance isn't always included in those 'ACME Insurance Company' policies that are too cheap to be true.
The acid test? A good policy will be written in plain English and have NO SMALL PRINT.
3. Don't leave it until the last minute to get yourself covered
An invaluable component of travel insurance policies includes cancellation due to illness, injury or bereavement. If you book your flights or package holiday in March but aren't travelling until August, anything could happen in the following six months, which might force you to cancel.
If you have no insurance in place, you could not only loose your deposit, but be liable for the balance as well. Ouch!
4. Be Warned...
Most travel insurance policies do not cover injuries, illness or death sustained as a result of the insured participating in 'dangerous' sports. Bungee jumping is out, as is free-fall parachute diving, although travellers to Tobago shouldn't worry too much about that.
Diving (not snorkelling), Horse riding, water skiing, and rock climbing are all likely to be excluded sports. Wind and kite surfing, surfing and mountain biking could be excluded from certain policies. If you are likely to be participating in, or are arranging your holiday around any of these sports, check with your insurance company BEFORE you go.
Some insurers will accept diving down to 10 metres, for others it's a complete no-no. There are specialist policies available for the more adventurous and the premiums you pay will reflect the additional risks associated with these activities.
If you suffer an injury whilst participating in an excluded sport or activity - don't even bother trying to claim on a bog-standard policy. Get the right cover before you travel!
5. Check the cover of annually-renewed policies before departure
If you have a policy offering 'family cover' these often only include children up to the age of 18. If your kids are now at or above this age, they may need to seek cover independently.
Notify your insurer if you have suffered any deterioration in health e.g. if you've had a heart attack, since you took the policy out. If you haven't told them, they are likely to reject a claim if you have another attack whilst on holiday. This would be a perfectly valid reason for rejection of a claim as you have withheld a material fact, which should have been disclosed and may have resulted in an increase in premium at renewal.
The same goes for the more 'mature' traveller. Many insurers charge additional premiums for the over 65's. Don't be tempted to fib about your age to get a lower premium (as if you would).
Any claim could be deemed invalid; once the insurance company suss that you are not as young as you thought you were (based on your medical records or copy of your passport). At the very least, the claim won't be honoured, at worst; you could find yourself in trouble for fraud.
Having said that, there are travel insurance policies especially for the young at heart from firms like SAGA.
6. Read your policy before your departure
I know it's boring, but it can save time and confusion and you should know what to do in the event of an insured incident e.g. if your camera is stolen, report its theft to the local police and obtain a crime report receipt. Most insurance companies will, naturally, require you to comply with their procedures before they will cough up. Retain any receipts for medical care or replacement of baggage or personal effects. If your plane is delayed or your baggage is lost, get confirmation from your carrier in writing in order to substantiate your claim. If you are part of a package trip, get the local rep to write a report.
7. Don't leave home without it
Take your policy document, or a photocopy, on holiday with you. In an emergency it will tell you what you should do and how to ensure that any claim can be met. It will contain information on who to contact for assistance (if it doesn't, then you shouldn't have bought it) and the limits for replacements of delayed or lost luggage or alternative accommodation if your flight is delayed or cancelled. This way you will be able to make any of these unfortunate, but all too common problems, tolerable.
8. Enjoy your holiday
Enjoy your holiday, safe in the knowledge that, if you are unlucky enough to require assistance, your insurance company have contracted to come to your rescue - but only for those risks that they have agreed to insure against.
Buying Travel Insurance
One of the most convenient ways of arranging cover is as an extension to your existing household insurance policy, renewable on an annual basis. Not all companies offer this facility, but most of the main insurers do. So, ask for a summary of cover, to check over, before you add this benefit to your contents policy. You can usually pay by direct debit to spread the cost.
If you are still in the dark about the type of cover that you need and the level of benefits that would suit you, contact an insurance broker (Yellow pages, Thompson's or Talking Pages). They should give you unbiased advice and find a policy that offers suitable cover at a competitive premium. If you need a policy offering specific levels of cover say, for an expensive video camera, diving equipment, jewellery, or for those risky activities and sports mentioned earlier, then your broker will be able to source these specialist policies and make sure that you are covered adequately. Many will assist in the completion of the paperwork and, on payment of the premium, give you immediate cover. Job Done!
Your Bank will probably mail shot you (mine does about four times a year) with details of their 'best deal on the market' travel insurance. They trawl their data bases for customers who order foreign currency or travellers cheques and target their unsuspecting account holders. From the currency that you order, they even have a good idea of where you're jetting off to.
Usually, your bank will offer their insurance policies, rather than a range of companies. If you like having the choice or need a specialist policy, than the bank isn't the best answer.
If you are happy to arrange your own cover, without seeking advice, then most of the major supermarkets have application forms at their checkouts. You can pick one up when you've completed your weekly shopping. The policies are underwritten by insurance companies or Lloyds syndicates rather than with the supermarket themselves. They just act as a broker, but without the personal advice. Maybe you're happy to buy your policy over the net. There is nothing wrong with that, but once again, if you have any questions or specific requirements, you might be better seeking advice from a broker.
Last, but not least, there is your travel agent of course. You would reasonably expect that they should be expert in the ins and outs of travel insurance policies wouldn't you? From my experience, sometimes they are not. I don't wish to be unfair to travel agents but having taken the easy option on two occasions (many years ago) and accepted the policies offered to me at the time of booking our holiday, the levels of cover were below Parr and the premiums were over the odds.
If your travel agent or broker seems vague on any of the core benefits of the policy they are offering e.g 'How much is the lost baggage allowance?' 'Umm, Err, let me see', I would say thanks, but no thanks. The same goes if they offer cover with a company you have never heard of.