Guide - Getting Good & Cheap Insurance
- Bernhard Budiono
- Apr 19, 2017
- 5 min read
Travel insurance is essential. I don't know how many close calls, near misses or emergencies I've had on my travels, and each time my investment in insurance has not been in vain. I have lost my phone, been helicoptered from the top of the Himalayas, and had countless near-misses, which have reinforced my own personal need and belief in the value it brings.
However it is important to do your research and make sure you don't pay for too much or get the wrong type of insurance. For as little as $2 AUD a day, you can rest assured, that you have sufficient coverage in the event of any incident. I've spoken to friends and they've told me that they have gone without travel insurance for trips sometimes as long as a month.
I've heard horror stories from accidents, to flight delays even to muggings and drunken behaviour, all of which with the right travel insurance coverage would make the transition smooth and relatively pain free. Frankly, it is not a risk worth taking to go overseas without Travel Insurance. For lost and stolen items (of which I have been a victim of both!), it is generally compulsory for a police report to be filed within 24 hours of the event occuring. If you think that something has been stolen, or misplaced, but you are unsure, it is often easier and far safer to err on the side of caution and get a Police Report filed immediately. More than likely local police would not bother with pursuing such a task, and you are doing it just to cover your bases.
Be aware that conducting fraudulent activities, especially claiming things that are not "stolen" or "lost" is not advisable. Insurance companies have a way of finding out and if they find out, it won't be pleasant for any party. Bottom Line? Don't do it!
I've answered some basic questions, that when I set out on my first travels were the first questions I asked to those more knowledgable on the topic.
Note: Always read the fine print! Either take the time to speak to someone over the phone or to read through the guide to make sure that you know your inclusions, exclusions, and any restrictions or constraints that may be in place. Generally speaking, there are a few universal rules that are common amongst policies, and in some cases policy/insurance underwriters provide the same policies for different prices amongst different sellers. Read the fineprint and compare!
What is Travel Insurance and Why do I need it?
Travel insurance is an emergency net for when things go wrong; albeit an injury or an accident, lost phones or flight delays. If you're going to be out of pocket for something that is not your fault, you are likely to be able to find a travel insurance policy to suit and that will cover your losses. However, the more riskier the destination, the more you have to consider your contingencies and begin looking at probabilities.
For example, theft in some developing nations (even in your hotel room) is relatively common place compared to travelling to parts of the USA, UK, Europe or New Zealand for example. Therefore, you may want to cover the goods that you may have on your person, but not necessarily for things like your laptop or expensive clothes that you will likely leave in your hotel room. It is important to distinguish between Health and Non-Health related risks, and either adequately prepare for it, or get the insurance coverage in the event something goes wrong.
What types of Travel Insurance is available?
There are various types of Travel Insurance Plans. Generally speaking the main categories are Travel Medical, Evacuation, Accident and the Package Plan.
The table below provides general advice for all of the different options available and what type of coverage each one would possess.
What types of travel insurance do I need?
Package or comprehensive plans are perfect for family vacations or for travelers who will be doing a lot of different activities. It covers generally all of the main risks that travellers may encounter, which makes it the most popular because it fits the needs of the majority of most travellers. Most comprehensive travel insurance policies cover additional conditions such as trip cancellations, etc. This makes it the "safe option".
Does it cover existing or pre-existing conditions?
The majority of policy underwriters don't provide cover for pre-existing conditions; depending on the insurance provider, if you have not provided the information on your application, it may not bode well should an incident occur which is related to the existing-condition.
However, the majority of policies will provide you with the coverage if you get sick on your travels. For chronic conditions, you could be out of luck.
Should I just use my Credit Card Travel Insurance Coverage?
Credit Cards, even the best of them generally provide a very limited level of protection. There is a list below of some of the best credit cards that provide Travel Insurance as part of their features, as long as the trip is bought and paid for using the card.
The majority of these policies may not cover things like injuries from Scooters, etc, or anything that is generally outside of the basic level of cover. If they do provide you cover, the amount is likely to be quite low, that consumers will need to pay the difference.
How do I claim?
For any claims, you need to make sure you keep your invoices, receipts and any proof that is related to the incident.
Most credit cards will provide you with a 24-Hour Worldwide number that you can contact; ensure you are aware that if you take out a second private insurance policy, if they are provided by the same underwriter, then it will generally be the credit card as first priority for a claim, and if that policy doesn't cover the incident, then the private policy will.
It is important to conduct your own time and space appreciation of the risks, the likely issues you may face and what coverage you have to combat any financial hardship you may face. In the end, that's the key! Are you going to be at a significant loss financially if something happens?
The Good
1. Overseas Emergency Medical Assistance
2. Cover for hospital Costs
3. Potential Cover for Accommodation and Travel Expenses
4. Potential Cover for Family Emergencies
5. Potential Cover for Companions & Family Members
6. Resumptions or Delays in your Journey
7. Hospital or Emergency Cash Allowances
8. Accidental Death or Permanent Injury
9. Future loss of Income
10. Credit Card fraud, loss, theft or replacements
11. Theft of Cash, Travellers cheques and documents
12. Luggage, Personal Items, etc.
13. Potential Cancellation fees and lost deposits
14. Alternative Transport
15. Personal (Or Professional) Liability
16. Rental Vehicle Excess
17. Potential Housekeeping or Domestic Services
18. Domestic Pet Cover
19. Peace of Mind
20. Requirement for many adrenaline sports or activities.
The Bad
1. The Cost
2. The Fine Print
Be Careful
What you should ask yourself is, Why am I buying this? The answer is simple, it should be to protect you, your loved ones and any personal effects from disaster or distress; albeit financial or physical.
The main disadvantage of buying private travel insurance is duplicate coverage. You may already have sufficient cover through work, volunteer organisations, credit cards or countless other options. Remember you will only be paid out a single policy, so it's best not to pay for accidental death, when you have sufficient life insurance coverage.
It is important to know what your travel insurance policy covers before you buy it. There are countless exclusions, especially regarding the consumption of alcohol. My suggestion is to always speak to someone with knowledge about the policy and confirm any last minute qualms you may have.
Best Travel Insurance Credit Cards Available in Australia (From my experience):
1. Qantas American Express Ultimate Card
2. American Express Platinum Reserve Card
3. ANZ Low Rate Platinum Card
4. ANZ Frequent Flyer Black Card (Or Equivalent Bank Issued Premium Card)
5. Virgin Velocity American Express Platinum Card
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