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Guide to Comparing Travel Insurance Policies

6th February 2017

Comparing Travel Insurance

If you’ve travelled overseas before, then you have probably heard the lecture about the importance of getting travel insurance. You may have even been told the common saying “if you can’t afford travel insurance then you can’t afford to travel”. If you haven’t, well now you have – we’ve just told you!  It may sound a bit naff, but the reality is that it pays to plan for the unexpected when you’re travelling, and that makes travel insurance super important. 

But, there are so many different travel insurance providers and policies on offer these days, so we get that it can be overwhelming and confusing when it comes time to choose one. That’s where this little guide will help you figure out what to look for when comparing travel insurance providers and policies.

How to Compare Travel Insurance Providers

Let’s start with the policy providers, because, well, it’s as good a place as any to start. There are a few different types of providers that you can get your travel insurance policy from, so when it comes time to compare policies, it is also worth comparing who is offering you that policy.

Here are some options you can consider:

  • A policy from a direct provider – in this case, travel insurance is their primary focus – they specialise in it and have the experience to help you find the right policy for your holiday.
  • From a larger business where travel insurance is their secondary business, like a supermarket – in this instance, it’s important to look at what other customers have to say about their travel insurance offering – the company’s main focus is likely to be on its p[rimary business (eg.  Groceries)  and not your holiday insurance, so their claims process could be slower and their customer service off the mark.
  • Travel insurance included with your credit card – with one of these policies, you need to make sure you know the level of cover and the benefit limits being offered as it can often be much lower than what you would get from a direct provider, and what you might save with your “already-included-policy” you lose ten-fold with out-of-pocket expenses that your policy doesn’t cover.
  • Travel insurance through a travel money expert, or travel agent – here, you get a policy from a direct provider, but with your travel money expert or travel agent acting as a middleman, getting a quote on your behalf and facilitating the purchase for you.

When comparing your options for a travel insurance provider, consider whether they offer 24-hour emergency assistance (definitely needed when you’re in a different time zone); if they are underwritten by a reputable company; if they have an in-house claims department; and if they have positive online customer reviews.

Comparing Travel Insurance Policies

Your travel insurance is there to protect you from the unexpected, so as boring as it may seem to read all the fine detail online and in a Policy Wording, it’s also equally as important so that you know what unexpected events you are and aren’t covered for. So our first recommendation is to read the Policy Wording! While doing so, here are a few things to pay extra attention to:

What’s Included in the Policy?

With different levels of cover comes different levels of inclusions, so you should start by finding out what is included in each policy – from the budget ones through to the comprehensive ones.

The main inclusions to focus on would be:

  • Medical cover (in some countries it can cost over $600 per night to stay in hospital – do you really want to be footing that bill?);
  • Cancellation cover (for example, if your flight is cancelled due to bad weather, or a natural disaster means your coach trip is cancelled);
  • Luggage cover (for your personal belongings should they get lost or stolen);
  • And extra activities (are you planning on going skiing, or riding a motorbike? Then you might need additional cover for these high-risk activities).

All policies are different, so it is worth checking exactly what is included and excluded for each of these main components, including what the benefit levels are for each of them.

What’s Excluded in the Policy?

All insurance providers have their own list of activities and events they won’t cover you for, but as a base, you can assume you won’t be covered for any costs associated with you breaking the law; drinking alcohol; ignoring official warnings (like those issued by The Ministry of Foreign Affairs and Trade); you leave your belongings unattended and they get stolen; you purchase a policy after a claimable event (like a natural disaster) has been published by the media or the government; your travel supplier or agent goes bust, or if you thought you were covered but just hadn’t read the Policy Wording.

Pleading ignorance will not get you covered unfortunately.

Other considerations

Depending on your circumstances, there may be other things you want to be covered for, like a pre-existing medical condition (mental illness, cancer, pregnancy etc.); emergency dental care; any legal costs you might incur should you be in an accident; rental vehicle excess and so on.

Some policies may automatically include these extra items for cover, others may incur additional costs, so it is worth reading that fine print so you don’t assume that fixing your broken crown while you’re in Greece will be covered by your travel insurance, only to get home and discover that bill is all yours!

Policy Type

There are lots of different kinds of travel insurance policies for you to purchase, so you should consider your needs and the type of holiday you are going on before you buy. For example:

  • Do you need international or domestic cover?
  • Do you just want a basic budget-level cover, or something more comprehensive?
  • Are you travelling more than once in the year? –If so, maybe consider an annual policy rather than a single policy.
  • Are you travelling as a single, a couple, with family?
  • Are you a senior citizen?
  • Are you pregnant?

Different policies will also have different excesses – the higher your excess, the more you will pay out of your own pocket when it comes time to make a claim. You should consider which policy will offer you the highest level of financial protection that you can afford, against the broadest range of unfortunate events.

Comparing the Price of Policies

First up – the cheapest policy isn’t always the best one for you. That’s why it’s important to mention all of these other things first. But, we know that price does play a role when it comes to comparing policies and deciding on one to buy.

The cost of a travel insurance policy is determined by a number of variable factors, including:

  • Your destination – how far it is from New Zealand, and what the cost of medical treatment is in that country.
  • Your dates – the longer your trip, the more your insurance will cost.
  • Your age – unfortunately, the older you get, the “riskier” you are considered (due to pre-existing medical conditions), so your insurance could be more expensive.
  • Your pre-existing medical conditions – some medical conditions may be included, and each provider will have their own list. Anything outside of this list may incur extra costs.
  • Extras – if you want to add extra cover for high-value items, ski rental excess etc., these will come with an extra cost too.

Once you receive a quote for the policy that is best suited to you and your holiday, you can then compare the cost of policies, together with what is included, and from different providers. Value for your money tends to trump outright cheap prices, just because of how much money your policy could save you should anything unexpected happen.

So that’s it – travel insurance lecture over. Hopefully you already know that you should get covered, and after reading this you also know what to look out for when comparing travel insurance policies so that you can buy one that is best suited to you and your holiday needs, at the best price available.

You can kick-start your comparisons with a quote from Cover-More Travel Insurance, which Travel Money NZ offers and recommends. You can get a quote online, or just speak to any of our instore specialists for details on a policy to suit you.

Limits, exclusions and conditions apply. Insurance issued by Great Lakes New Zealand. Please consider your financial situation, needs and objectives and read the Policy Wording available from us before deciding to buy this insurance.

This blog is provided for information only and does not take into consideration your objectives, financial situation or needs.  You should consider whether the information and suggestions contained in any blog entry are appropriate for you, having regard to your own objectives, financial situation and needs.  While we take reasonable care in providing the blog, we give no warranties or representations that it is complete or accurate, or is appropriate for you.  We are not liable for any loss caused, whether due to negligence or otherwise, arising from use of, or reliance on, the information and/or suggestions contained in this blog.