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According to the ABI (Association of British Insurers), over half a million Britons made a claim on their travel insurance in 2017. 52% of all claims, worth on average £1,300 each, were for medical expenses followed by over a third (34%) for claims related to trip cancellation. In total, British travel insurers paid out £385 million. In this article we discuss:
- What travel insurance is
- If you need travel insurance
- How much travel insurance costs
What is travel insurance?
Travel insurance is a policy which protects you from financial loss if something goes wrong on the way to/from your travel destination or whilst away. It can be purchased for both domestic and foreign trips. It is also suitable for both recreational and business trips – however long their duration.
Policies vary in their provision, but they typically cover you for:
- medical emergencies, treatments and repatriation to the UK,
- the cancellation of trips due to circumstances beyond your control,
- the loss or theft of belongings in transit or while away.
Do I need travel insurance?
If you have insurance as an add-on to another financial product (such as a bank account), you should always check its terms and conditions carefully. Many such travel insurance policies have age limits, exclusions and/or limits on pay-outs. As a result, it might be a good idea to take out a stand-alone policy as well. Your home contents insurance policy might also cover you for the loss or theft of belongings that are regularly taken out of the home. However, you should check that you’re covered for foreign trips as well.
Some travellers believe that an EHIC card is sufficient cover when travelling in Europe as it gives them access to free medical treatment. However, this card doesn’t cover repatriation to the UK which can cost thousands of pounds, nor does it cover the cost of medical treatment outside the EU. In general, travel insurance is highly recommended wherever you go. Could you afford to pay if you had an accident, or your trip was cancelled?
Your E111 or EHIC Card
As far as medical indurance is concerned, as we stand in 2020 UK citizens are still entitled to an EHIC (European Health Insurance Card), sometimes known in the UK as an E111 card. This covers you for unexpected medical treatment while you are abroad but is not a replacement for either travel insurance or your own medical insurance cover. It should also be noted that the E111 or EHIC card does not cover you for everything and you may be liable to pay any differences which arise. You will not be covered by your E111 card for medical tourism, such as going abroad to have a baby in a specific country, or for procedures such as plastic surgery.
See our article on how to renew your E111 card in the UK
Questions on travel insurance
While travel insurance for UK holidays may not always be a necessity, depending on your circumstances, most travel insurance companies provide you with a cover for UK holiday if you have pre-booked accommodation for a consecutive stay of two to three nights or longer.
Travel insurance is generally worth getting, especially if you are making international trips or taking an extensive holiday. When travelling abroad, especially if you are older, you aren’t going to be covered by your health insurance for over 70s provider. Consequently health services may end up costing you a lot. If the NHS has agreements with the country you’re visiting then this cost may be mitigated, however it’s always best to keep an active travel insurance policy to cover for unforeseen circumstances during your trip.
The best time to purchase your travel insurance policy, if you are looking to save money, may be when you are booking your air plane tickets. A combined booking may give you access to additional deals leading to lower overall costs for your holiday. Booking your travel insurance early can qualify you for bonus coverage, although it is still possible, with most insurance providers, to purchase cover until the day before you depart.
How much is travel insurance?
One of the factors which affect the price of insurance is the excess, which is your financial contribution to any claim. This is typically £50-£100 for travel insurance. Generally, the higher your excess, the lower the cost of your insurance. Apart from the excess, how much you pay for insurance depends on other key factors such as:
Where you travel – coverage for European destinations is cheaper than the US.
Your age and/or pre-existing medical conditions. Someone over the age of 60 will want to apply for over 60s travel insurance.
How often you travel – an annual multi-trip policy works out cheaper if you travel regularly.
Your activities while away – travelling on a cruise ship or engaging in risky activities like scuba-diving will increase the cost of your insurance.
How many people on the policy – cheaper insurance is available for couples, families or groups.
The type of holiday – independently-arranged travel is more expensive to insure than package holidays.