Travel insurance
| When you're putting most of your energy into organising your travel plans, you risk purchasing insurance that might not give you the best value for money, and may not cover you for what you think you're being covered for. |
Don't just chase the cheapest policy without checking exactly what it covers you for.
You can read some real life travel insurance stories of Australians travelling overseas on smartraveller.gov.au 
.
Fact sheet for young people about travel insurance
Check what's NOT covered under your policy
No travel insurance policy will cover you for everything that might happen on your holiday. A policy will usually cover events such as personal injury and loss or theft of your possessions, as well as costs that you incur if your travel plans are disrupted.
However, the most common reason that insurers give for refusing travel insurance claims is that the claim is excluded under the policy. It's therefore just as important to know what's not covered by a policy, that is 'the exclusions', as it is to know what is covered.
Carefully check all the exclusions before you decide on a travel insurance policy. They should be clearly identified in the policy document. For example, you might see policies that exclude claims for loss or damage suffered because:
- your airline stops trading and you can no longer travel
- you travel to certain countries or against the advice of the Australian Government. Check the Australian Department of Foreign Affairs & Trade's website, www.smartraveller.gov.au .
- you cancel plans because of fear of terrorism. Many insurers will not cover you against terrorism or acts of war. In those that do it may be a condition that you take the policy out before the problem occurred and/or that you don't travel against Australian Government advice. More information on insurance and terrorism
- you didn't advise the insurer of a pre-existing medical conditions or you travel against medical advice
- you join in 'adventure', 'danger sports' or other hazardous activities. 'Adventure' activities often include bungee jumping, white water rafting, ballooning, snow skiing and scuba diving.
- you leave your luggage 'unattended' in a 'public place' and it is lost or stolen
- your cash is lost or stolen. Many insurers don't cover cash or have limits on how much is covered and usually only allow claims if the cash was 'on person'
- your valuable items such as cameras, sound equipment or mobiles are stolen if left 'unattended' in a hire car
- you are over a certain age. Some insurance companies won't insure you if you are over 80 years old. If you are over 70, you usually need a medical assessment and you'll probably have to pay a higher premium
- you cancel plans because of a change in your financial circumstances or business obligations.
| TIP! | The best advice is usually the simplest
Always read the policy and the product disclosure statement (PDS) carefully before you buy. |
Different travel insurance policies give varying levels of cover
Some policies include 24-hour medical assistance, a help line and private hospital cover, although be careful of 'special circumstances' which can apply. Other policies target younger travellers and will cover a broader range of adventure-type activities.
It is important to advise your insurer if you are planning an adventure holiday.
Shop around to find a policy that suits you and the type of holiday you're planning and don't just chase the cheapest policy. Consider whether you might be better off paying a higher premium up front so that you will pay a lower excess if you have to claim.
Pre-existing medical condition or pregnancy
It is important to tell your insurer about existing medical conditions for both yourself and close family members. Many policies do not cover you if your condition flares up while you are holiday or if you have to cut short your trip because the condition of a relative at home with an existing medical condition worsens.
Your private health insurance in Australia may not provide coverage overseas. If you don't tell the insurer at the time you apply for cover, your whole travel policy — not just medical cover — could be cancelled or claims refused.
Ask questions to clarify your understanding
Don't be afraid to ask questions if you don't understand how a policy works or if you want to clarify how the insurer will apply special policy terms such as 'unattended' and 'reasonable'.
If the licensed or authorised agent or broker selling the policy can’t give you an adequate explanation, then contact the insurer direct for more information. It's often a good idea to make a note of any special advice or explanations that the agent or insurer has given you in case there is a disagreement about what was said.
Check the duration of your policy
So, you've chosen a policy that suits you and your travel plans. However, before you sign on the dotted line, it doesn't hurt to double check the duration of your policy.
A travel insurance policy should cover you for the entire duration of your trip.
| TIP! | You might want to think about whether you should add a couple of extra days to your policy so that you're covered if there are delays or cancellations, or if you change your travel plans. |
Read the policy again before you leave
Make sure you're familiar with the full extent of your cover before you go. Based on the coverage and exclusions, you can then decide what belongings you might take on your holiday.
| TIP! | Remember your insurance while you're away
- Make sure you know when you are required to notify local authorities about loss or theft in order for a claim to be paid. This may be as little as 24 hours.
- You need to keep the receipts of any expenses (such as, hotel accommodation, replacement personal effects) you paid because of an insured event that you might claim on your return.
- When travelling, carry with you details of the emergency assistance offered by your insurer.
- Think about your insurance cover if you're considering some risky/adventurous activity.
Take a copy of the policy with you on holiday so that you know what to do if something goes wrong. |
Making a claim under your travel insurance policy
As the travel insurance brochures will tell you, accidents can happen. And if they happen on your holiday, then you need to know what you are expected to do under your travel insurance policy. Otherwise you risk a claim being denied in part or in full by the insurer.
Here's what you should keep in mind about making an effective claim:
- You need to understand how the excess works. Your policy might have a separate excess for different types of claims set out in the policy. This means that if you have two unrelated claims you might have to pay two lots of excess.
- Check any deadlines for making a claim with the insurer when you return.
- Your policy might prevent you from admitting that you are at fault for any claimable incident.
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Seeking a review of your claim
If you disagree with a decision about your insurance claim, your first step should always be to raise this directly with the insurer by using their dispute resolution system.
How to complain
If an insurer rejects your claim, it's not necessarily the end of the story. You can go to court or you can take your case to a complaints resolution scheme.
Guide to making a complaint
Independent complaints schemes
More information
General insurance
Insurance and terrorism
Product disclosure statements
FIDO Website: Printed 02/10/2010
