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Do I
really need travel insurance?
We’ve all heard the horror
stories of people losing their money, passport, sometimes
all their luggage, leaving them stranded far from home. Or
even worse, being injured or just getting sick in the wrong
part of the world.
If you can’t afford the
insurance, you can’t afford the trip. Travel insurance
isn’t an option when you are travelling overseas. It’s
an absolute necessity.
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What
features should I look for in a travel insurance policy?
There is a very wide variety
of travel insurance policies available. They all have their
good features, and they all apply various restrictions.
It’s important that you know what you want covered, and
understand what your policy actually covers you against.
We’ve all heard the
horror stories of travellers injured in places like the
United States or Europe, where a hospital bill for a
relatively minor condition can exceed $50,000. In such
circumstances, that insurance premium seems like a great
investment!
Travel is one of the most
hotly contested classes of insurance when it comes to
claims. Last year, Insurance Enquiries and Complaints, the
insurance industry’s dispute resolution system, reported
that the vast majority of disputed travel claims revolved
around two areas: what the policy was intended to cover and
how much goods claimed for really cost.
Check out the available
policies very carefully, taking into account where you are
going, what you are likely to have with you and what the
costs are likely to be if you are injured.
Don’t take out the first
policy you’re offered, without understanding what it
contains. And don’t leave your travel insurance to the
last minute because the choices on offer are quite wide.
Most policies offer singles and partnerscover. These
policies generally cover children travelling with you.
What you should look for:
Medical and
additional expenses
Including cover for the costs of medical, surgical,
hospital, ambulance, emergency dental, medical evacuation
and additional expenses.
Cancellation
Cover for cancellation charges on prepaid arrangements.
Luggage and personal
effects
This covers you for your personal belongings that are taken
on the trip or purchased during it. Note that there is
usually a limit per item, with an overall limit for
electronic equipment like cameras and personal computers.
Travel documents
Cover for travel documents, credit cards or travellers
cheques that are lost or stolen. There is usually a limit
– either per item or overall – on these.
Personal liability
If you accidentally injure another person or damage their
property, this provides you with cover against the possible
cost of the damage. In some parts of the world, the
liability can be huge.
Return airfare
Some insurers offer to reimburse the cost of your airfare if
you suffer an accident or need to return home due to a
covered event outside your control.
Travel Delay
Reimburses you for additional meals and accommodation
expenses if your journey is delayed for more than a certain
number of hours. Delays due to industrial action and –
even worse – weather are far more common than you might
think.
Emergency luggage
Allows you reimbursement of your purchases for essential
items if your luggage is temporarily delayed by the carrier.
Additional items that are
worth considering:
Accidental death
It won’t make you feel any better (how could it?) but a
payout to your estate should you be killed on your trip will
certainly make things easier for your family. Limits usually
apply, ranging from $10,000 to $25,000, depending on the
type of policy.
Resumption of
journey:
If you have to return home early due to the unexpected death
of a relative, some insurers will offer you cover for the
costs of resuming your overseas trip. Note, however, the
word "unexpected".
Out-of-pocket
expenses
Provides you with spending money for each day that you are
confined in an overseas hospital.
Loss of income
The accident you had while you were overseas may prevent you
from working on your return home, so some policies provide a
benefit ranging from $5,000 to $25,000.
Domestic pets
Those kennel and cattery fees can accumulate rather quickly
if you are caught up overseas by injury or an unforeseen
delay.
Rental vehicle
insurance excess
Provides cover for the insurance excess on your rental
vehicle if it is involved in an accident or stolen. If
you’re planning to do a lot of driving on your overseas
holiday, it can be a very handy cover to have.
Free cover for
children
Some insurers offer free coverage for dependents under the
age of 21, accompanying the policyholder.
Amateur or action
sports
If you’re partial to skiing, ice sports, hot-air
ballooning, scuba diving, bungee jumping, white-water
rafting, parachuting, paragliding and so on, look for a
policy that offers specific cover for amateur or action
sports. The policy will define exactly what is covered. If
your favourite activity isn’t on the list, ask your
insurer.
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When can
I have my claims paid?
Usually when you return to
Australia, and only then after the insurer is satisfied that
all the paperwork is correct. If you plan to be away for a
long period, or the loss you’ve experienced is causing you
serious financial troubles, contact the insurer or the
emergency assistance helpline to discuss the options.
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Does my
insurance only cover me for the one trip?
Usually you take out
insurance for a period of time. Most insurers offer
unlimited trips for the duration of the policy.
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If I
develop a medical condition after taking out the insurance,
but before I leave Australia, am I covered?
If I develop a medical
condition after taking out the insurance, but before I leave
Australia, am I covered? [Back to Top]With the exception of
cancellation policies, your insurance only applies after you
begin the trip. Prior to that it’s your responsibility to
tell your insurer of any changed conditions. Your new
medical condition is likely to fall under that.
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Is there
an age limit on travel insurance?
There’s usually an upper
age limit. But insurers are aware of the fact that more and
more of our older citizens enjoy international travel –
and also that many are fitter than travellers half their
age. Some budget-priced travel insurance policies place
limits on travellers over 50, with cover ceasing at age 65.
However, most travel insurers only ask for a Traveller’s
Appraisal Form, which details the customer’s state of
health, when they are aged 70 or more.
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Should I
obtain police reports or doctors' details for insurance
purposes?
We know it cuts into your
valuable holiday time, but there isn’t a lot of point in
trying to obtain such vital information once you have
returned to Australia. Get the information you need as soon
as possible, and store it in a safe place.
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If I
decide to return home because I am ill, do I need the
insurer’s agreement?
Yes, whatever the
circumstances. If you intend to do something that you will
claim for later, you first have to obtain your insurer’s
agreement
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How do I
obtain advice from my insurer while I am overseas?
Many insurers provide a
phone number you can call from anywhere in the world that
will give you advice and assistance. Check your potential
insurers to see which ones offer this service, because it
can be very useful indeed.
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I was
robbed of $300 in local currency. Do I have a claim?
Normally you won’t be
covered for cash. That’s why it’s better to use
traveller’s cheques or credit cards.
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My golf
clubs were lost by the airline, so I had to hire some. Do I
have a claim?
Yes. Insurers accept that
sporting equipment – particularly skis and golf clubs –
are normal holiday equipment for some people. So they will
pay you the necessary cost of hiring replacement equipment,
usually up to a limit of $150 to $300. Of course, you will
have to support your claim with receipts.
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Why do I
need coverage against medical treatment?
Famous last words. For
example, the average hospital bed in the United States is
$US2,000 a day. The cost to repatriate you from anywhere in
the world is going to be at least $50,000. Contemplate
having no travel insurance if you take ill wherever you’re
planning to travel. What would happen if you were run over
in rural Thailand, broke your leg in Africa, or if you where
injured in a car accident in the United States.
Travel insurance is
essential. Like we said before, if you can’t afford the
insurance, you can’t afford to go.
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What is
a pre-existing medical condition?
It can be any physical
condition, illness or disease that you had in the period
before you took out the travel insurance policy. That
includes any chronic or ongoing medical condition. But
don’t worry too much about it. Most insurers will cover
you if you have a pre-existing medical condition, but will
require you to provide details and may charge a higher
premium to cover any higher risk you might pose.
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