BY JOHN ELLIS, FINANCIAL ADVISOR
EVEN with a travel insurance policy, many Irish holidaymakers could be leaving themselves exposed to serious financial hardship this summer for the sake of the price of a pizza and beer on the Costa.
The whole point of a holiday, is it not, is to relax and enjoy oneself, returning refreshed? So why then do so many people not bother with travel insurance? And why do so many, after taking the time and expense of buying the insurance, not read the policy terms and conditions, thus leaving themselves exposed to serious levels of stress and financial difficulty should anything unexpected happen while away?
Travel insurance gives peace of mind because you know you have protection in case of common travel mishaps. Not only that, you’re never alone as no matter where you are, help is but a call away. Whereas if you don’t have travel insurance you will have to pay out of your own pocket to deal with any problem while you’re away, or lose money if you have to cancel a trip and can’t get your money back which can run to thousands of euros.
A lot of travellers are purchasing cover that is simply below the minimum level that is required for the policy to have any meaningful impact in the event of a claim. According to Peopl. Insurance “while a ‘cheap’multitrip policy may cost just €25, it may not cover a holidaymaker for the most basic of claims, but spending just €15 more, travellers can get a policy that will provide them with much more comprehensive cover.”
Of course we all want to save money where possible, but where this cost cutting renders a policy virtually unusable, or below what you need in the event of a claim or worse void, means you have wasted what you shelled out and could also find yourself with a huge bill should something happen while on holiday, or even before you leave.
Ireland is well on the road to recovery in terms of international travel but the high numbers of passengers are challenging airport operations at the moment due particularly to staff shortages. Therefore, according to Peopl CEO Paul Walsh, ”one could argue it’s more important than ever to ensure that you have appropriate travel cover to protect you in the event of flight delays, cancellations, and delayed or lost luggage. “
While the pandemic has abated, Covid is still a consideration and holidaymakers are advised to check the details of their policy to ensure cover is in place should you contract Covid while abroad. Cheap is not always cheerful, so peace of mind is vital and paying that little bit extra to ensure you have sufficient cover may turn out to be a blessing in the event of having to make a claim this holiday season.
There are certain areas where it is important to have the definitions nailed down.
Medical Costs: make sure you know to what extent medical fees will be covered. Make very sure you disclose pre-existing medical conditions, otherwise you will run the risk of the policy being void in the event of a claim.
Trip Cancellation Cover: this does not necessarily mean you are covered for any and all events that might lead to the cancellation of your trip. So, it’s important to know what exactly your policy covers. For example, a low premium plan may not cover delayed and missed departures – which is a basic feature of standard policies.
Belongings: check that any items you intend to bring are covered, especially if you are bringing, for example, jewellery, laptops and smartphones.
Excess: As with most insurance contracts there is an excess which means you agree to cover a certain amount of the claim with the policy covering the rest. Make sure you know it! For example, the difference between the excess for lost baggage and the amount paid by the insurer may be minimal, leaving you with an unexpected bill. So, make sure you know the excess and you can afford the difference in the event of a claim.
It seems the older the policyholder, the more likely they are to have comprehensive cover in place. Mr Walsh commented, “Perhaps they have learned from experience that it’s worth ‘buying once and buying well’, spending an additional €10 or €20 to ensure they have the right level of cover they need.”
Young people with and without families may well opt for the lowest premium on the market – but then find themselves wide open in the event of a claim while on holidays. Remember the difference between poor cover and the best cover may only be €20. Do your research.