Wondering whether travel insurance is worth purchasing for your next trip? The answer is yes. From stolen cameras to medical emergencies, holidays don’t always go as expected. Here’s how prepare for the travel pitfalls that could come along during your holiday. We’ll answer the most commonly asked questions about travel insurance.
Read on to find out what look for when selecting travel insurance coverage for your next flight so that you can travel with confidence.
Travel insurance FAQs
Generally, travel insurance covers medical expenses incurred abroad as well as travel mishaps like flight cancellations or delays, lost luggage, stolen items, car accidents and hotel cancellations. Some insurance policies cover larger issues like pandemics, civil unrest and natural disasters. No two policies are the same, and what your policy covers depends largely on your trip and your situation at home.
The key factor to look for is medical coverage while overseas. If you don’t have a lot of money in savings, you will want an insurance company that can pay your bills directly rather than offering reimbursement for any medical services.
Your existing credit card, home insurance, health insurance or even car insurance might offer you some form of travel insurance coverage. Read the fine print of your existing policies before purchasing insurance specifically for your trip.
Your travel insurance may not cover extreme sports, travel to high-risk destinations, treatment for some medical conditions or missed flights. Some travel insurance providers cover activities like snorkelling, ziplining, hiking and cycling, but they won’t cover more high-risk activities like scuba diving, bungy jumping, hiking above 4,000 meters and ATV riding. Or, coverage for these activities could cost extra.
Most travel insurance also won’t cover any incidents that happen in destinations that aren’t covered in your plan. Sometimes, a ‘worldwide’ or regional policy will exclude countries highlighted on the Smartraveller ‘Do not travel‘ or ‘Reconsider your need to travel‘ lists. Don’t forget about stopovers where you’ll leave the airport when choosing your policy.
Travel insurance companies also typically require that you purchase your plan before the trip begins. If you’re already in your travel destination, you may have to pay extra for immediate coverage.
The Australian Government will not cover any medical expenses incurred abroad. This includes the cost of hospital treatment, amended travel plans and repatriation.
However, some countries have reciprocal healthcare agreements if you are a member of Medicare. This means you’ll receive subsidised emergency medical treatment, though you will still need to have travel insurance for some specific treatments and services not provided by the reciprocal country.
As of May 2023, Australia has reciprocal healthcare agreements (essential medical services only) with: Belgium, Finland, Italy, Malta, the Netherlands, New Zealand, Norway, the Republic of Ireland, Slovenia, Sweden and the United Kingdom. You must have your Medicare card with you to show proof of coverage.
If you have a valid reason for cancelling your trip, like a family medical emergency or you’ve come down with a medical condition, then your travel insurance should cover the cancellation costs. But if it is for a less urgent reason, say, for instance, you’d prefer to travel at another time, you won’t be covered.
If you think your plans could change, book flexible flight tickets and accommodations with generous cancellation policies.
For most travel insurance companies, you will receive a quote based on multiple factors. This includes your residency, your age, the destination(s) you’ll be visiting, the length of your trip, the value of the goods you’re travelling with, and the activities you plan to do.
If you’re travelling on a single short-term trip, it often makes more sense to purchase insurance solely for that journey. If you’ll be destination hopping for a long time, you should consider a monthly or annual plan.
Very few insurance providers will cover you if you travel to a destination that goes against Australian government advice. However, it gets slightly more complicated if your destination is put on the high-risk list between booking and departure.
When looking for insurance policies, keep an eye out for ‘trip interruption’ coverage. This often costs extra, but it is designed to cover travellers who booked their travel to a destination when everything looked good to go.
If you’re travelling on a strict budget and don’t have much to spare for travel insurance, consider coverage for medical expenses only. A medical incident can not only be life-changing health wise, it may also come with a massive financial cost. If you’re travelling light, relying on public transportation and staying in affordable hostels, then trip protection might not be a necessity. This means you take on the risk of being out-of-pocket should something go wrong with your travel plans.
If you cannot afford medical travel insurance, it’s best to postpone your journey and save up until you can purchase medical coverage.
To save money on insurance, consider purchasing it as an add-on to a flight booking, looking at the fine print of your credit card coverage and only buying what isn’t covered. Ask if you can get a special rate from your existing medical, home or car insurance providers to cover travel as well.
Trip protection if an airline or travel provider goes out of business is not included on most travel insurance policies. Check to see whether your trip is protected in case of financial defaults by an airline, travel or car hire company.
Some insurance providers will offer coverage, but the coverage varies greatly from company to company. According to Smartraveller.gov.au, over 90% of Australian travellers look for insurance coverage that covers COVID-19 related cancellations and medical expenses. If you’re within this category, here are things to look for in a travel insurance policy:
1. The coverage details for COVID-19. Are you covered for cancelled flights, medical expenses, repatriation or quarantine?
2. How far in advance from your scheduled departure date do you need to purchase your travel insurance policy for it to be valid for COVID-19 coverage?
3. Does your policy cover cruises (many don’t) and the destinations you will be visiting? Many companies will not cover any incidents in countries listed as high risk.
If the provider states that COVID-19 coverage is included, then your travel insurance should cover you as long as you bought the insurance before testing positive. Vaccination status may also be a condition you have to meet to qualify for the coverage. Many travel insurance providers require travellers to purchase their plan at least 21 days before their scheduled departure.
