Buying insurance is not the most exciting thing to be doing. That said some you must have, like car insurance, others you should seriously consider, like home or travel insurance. Whatever you decide to buy though make sure you take the time to buy the cover you need and critically understand what you’re buying.
So many people who decide to buy insurance, try and do it quickly online and end up spending money on a policy that doesn’t match their needs.
If you buy a car you take the time to think about the make and model, the colour and the extras you want. Insurance may not be such an expensive purchase, or indeed as interesting, but unless you take the time to consider your needs and then match a policy to these, you could find you have an expensive claim later on for which you are not covered.
This is a real issue. For example according to the 2013 annual review by the Financial Ombudsman Service, there was a 13% rise in travel insurance complaints .
Diane Ray, MoneyHighStreet.com comments: “We here at MoneyHighStreet have for a long time being trying to encourage people to take the time to assess the insurance they need and to make sure they buy a policy that covers these needs.
“With so many travel insurance providers offering differing cover it’s also critical to understand what cover you are buying and not just consider that the cheapest travel insurance is the best.
“Make sure you check what cover is being offered, the limit amounts and any excess you have to pay.
“There is no point buying the cheapest travel insurance only to find when you need to make a claim you’re not covered.”
So what should you consider when buying travel insurance?
With help from Greg Lawson, Head of Retail at Columbus Direct, here are some top tips:
1. Purchase early
Many customers don’t buy their single trip travel insurance until the last minute, with over 50% of policy purchases being made in the week before travelling. Most policies include holiday cancellation cover and, with only your deposit at risk eight weeks before you travel, escalating to 100% of the holiday cost in the last few days before you travel, it makes sense to take travel insurance out sooner rather than later.
2. Annual multi-trip postponed renewal
Cancellation cover commences as soon as the travel policy is issued. If your holiday is booked but you will travel in three months’ time, you should always start the policy immediately to get cancellation cover. However, if you have no holiday plans booked, some companies will allow you to postpone the renewal date of your annual policy by up to three months.
3. Your pre-existing medical conditions
Even if you have a condition that is well controlled you should still make your insurer aware of this as the majority of policies will work on the basis that claims related to pre-existing medical conditions are not covered. The definition of a pre-existing condition will vary from policy to policy so you should always check the terms to see how this applies to you. Some providers will allow you to go through a screening process to assess whether you can cover any existing conditions and there may be an additional premium payable to do so.
4. Changes in health
If you develop a new medical condition, or a pre-existing condition changes, before travelling then it is likely that you will need to tell your insurers about the change to your health. If the new problem causes you to cancel then you would just submit a cancellation claim. If you still want to travel then you should inform the insurers about your change in health as this could affect the cover they provide.
5. Pre-existing medical conditions of others
This is one that perhaps you may not be so aware of. If a non-travelling relative, or someone else that is not insured on the policy with you but could affect your trip, has a pre-existing medical condition, then cancellation or curtailment of your trip due to a directly-related illness may not be covered. Generally, insurers are unable to cover this even if customers were willing to pay an additional premium.
6. Sports and activities
If you are planning to take part in any activity while you’re away then you should check the policy wording or contact your insurers to make sure cover is available. However, not everyone knows what they want to do before they travel so have your policy documents stored on your phone or easily to hand.
8. Alcohol and drugs
Most policies carry a general exclusion for claims due to being under the influence of alcohol or non-prescription drugs. The specific wording will change from policy to policy and there is not a standard approach to how the exclusion is applied. It’s best to be sensible and stick to legal substances…and what is common sense. The local drink-driving limit, for example, is a good guide.
9. Personal baggage – single article/valuables limits
Travel insurance baggage cover is predominately in place for the loss of your suitcase and contents. Individually these items would generally be low value and covered by the usually low amount available in a standard policy. However, as more and more are carrying more expensive items such as smartphones, tablets and laptops, they expect these to be covered by standard travel insurance but many cost in excess of £300. Make sure your policy provides the cover you need and if need be buy a gadget top-up which is often sold alongside the basic travel insurance.
Consider too that these items should be insured all year round, not just when they take them on holiday.
10. Benefits and excesses
Finally, when buying cover you should always check that the benefit levels are sufficient for you and this includes the excess level. Check what cover and excesses apply, especially if buying on a price comparison site. Consider the cancellation cover too as for example it’s not worth buying a policy that only covers cancellation of £1,000 per person if the holiday is costing £1,500 each.
Finally, who are Columbus Direct you might be asking.
They are a leading travel insurance specialist which was established in 1988 selling both online via www.columbusdirect.com and offline via call centre channels.
They have a history of innovation in the industry, including being the first company to sell travel insurance direct to the consumer in the UK and also the first to fully sell a policy online.