Travel Insurance 101: The Low Down

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Over the last year, travel insurance has been a hot topic alongside the pandemic. A lot of people found themselves trapped overseas without the assistance of insurance, and many folks get insurance expecting it to cover the medical bills, when it only covers luggage loss and airfares. 

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What is travel insurance?

Travel insurance protects you against potential financial risks and issues that could happen on your trip, from lost contents, to medical expenses. It is designed to cover any unplanned events that can happen on your trip, something you can’t easily see coming or things within your control. 

There are insurance cover plans that can suit just about any budget, lifestyle, and travel schedule, so check what’s available for you. 

How does travel insurance work? 

For the most part, you pay for something, file a claim, and then you get reimbursed for it when the claim has been approved. Remember to keep your receipts so you can get approval! 

What does travel insurance cover?

Usually, travel insurance covers:

  1. Medical assistance
    • 24/7 medical assistance will help cover your medical expenses for an injury or illness during your trip. Make sure it covers hospital stays, surgery, dental, any medication, and doctor visits. 
  2. Cancellation cover
    • Cancellations and rearrangements of your trip can happen from illness, accidents, or even weather. 
  3. Damaged or lost luggage
    • Losing or damaging your luggage can be stressful and expensive, make sure to remove any of the hassle and check your personal items are covered. 
  4. Travel delays
    • Delays can mean missing out on accommodation, meals, and transport that are pre-paid, and adding a heap of these last minute costs back on. 
  5. Personal liability
    • Yikes, yes sometimes travel insurance can cover a lawsuit (to a certain extent). If you have been found to be legally liable for any accidental injury or damage you have caused to a person or property on their trip, you could be covered. 

What are the types of travel insurance?

There are so many types of travel insurance, so we’re going to chat through some of the common ones. 

  • Travel insurance from your credit card or airlines

We’ve seen this a lot! People assume that because they have their credit card, they’re covered for insurance. Without actually checking what you’re covered for, what you try to claim back might not be approved. Usually, there are excess fees you will have to pay before filing a claim, and there are specific exclusions in these policies. 

If you are planning on using travel insurance from your credit card or your bank, check that you have been underwritten correctly for peace of mind. Many credit cards or banks have underwriting at the time of claim, often resulting in your specific claim being excluded – for example you may only qualify for medical insurance if you called a certain number before going to the hospital (even in an emergency). We have also done our research and have seen that Pandemics and Acts of Terrorism aren’t covered, which can be stressful! 

  •  Direct travel insurance or travel agents

This type of insurance is directly from an insurance provider, meaning there isn’t a middleman getting involved. It often means you won’t always get the best deals, because you have to go in and bat for yourself, or take whatever is offered to you point-blank. 

Some agents charge a fee for their service, or you buy it on the spot when you purchase your trip. This can give you less of an opportunity to travel around, and less of an opportunity for proper underwriting! 

  • Through a broker

Maybe we’re a little biased, but we do love the helpfulness of a broker! We would make sure your entire trip, family, and any (and every) unforeseen event is covered. A broker will ensure you are covered across all bases, and ensure you have everything you need within your budget and travel plans. 

What’s the best travel insurance?

The best travel insurance will be the one that suits you the most, based on your medical history and where you’re planning ongoing. Of course travel insurance is competitive, but the best type of insurance will make sure you’re covered in the best possible way.

Check that the medical insurance is unlimited, your cancellation policy is easy to understand, and you have luggage cover to actually cover all of your needs. Make sure to read the small print, from 24-hour assistance or the cost of excess. 

Even the best policies will have exclusions and won’t cover everything, so make sure you have a clear understanding of exactly what is covered for you. 

Do you need travel insurance?

Yes! From our clients, to our friends, to our family, we’ve seen people head off overseas with the wrong type of travel insurance, or none at all, and end up in hospital. In New Zealand, we have a decent public health system that caters to most types of accidents at a pretty cheap cost, however overseas is a completely separate story. You might find yourself suddenly rushing to the hospital and finding yourself $30,000 out of pocket. 

Sometimes paying $1,000 can be extreme, but make sure to factor insurance into your budget, because we’re sure the costs of getting sick or losing contents will be way more expensive. 

We know that travel can be a costly exercise, especially travelling out of our isolated island nation! Adding extra insurance-related costs, and taking the time to prepare ahead, can really save you tens of thousands in the long run. Unsure where to start? Get in touchOr, do you want to read a little more about our excellent content? Check out our blog.

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