What is travel insurance?

Our experience has shown us that many people have expectations about travel insurance policies. When these aren't met, usually when a claim is made but declined, there is often, understandably, a sense of disappointment, even anger.

We don't like the thought of any of our clients experiencing this, simply because of a lack of understanding about travel insurance, so we thought we'd try to address the most common issues that arise. We hope this provides a greater understanding not only of our particular travel insurance policy but of travel insurance generally.

So, what is travel insurance?

Travel insurance is an insurance policy sold on the basis of trust between the purchaser and insurer. This means that a policy is sold on the basis of what is understood to be someone's situation at the time of taking out the policy. This understanding is based on what is declared or not when taking out the policy.

If an insurer needs you to declare certain situations, they will say so at the time of booking. An example of this would be if you have a pre-existing medical condition.

If a claim is made and, during investigation, it's found that the client's situation was not as declared, there is a risk that it will be declined. This can have very serious consequences if the claim is medical because bills can quickly run into thousands of pounds - many thousands if an air ambulance is require.

What's covered and what isn't?

No one likes to read policy wordings but how else is an insurer able to get across exactly what's covered by their policy and what's not? No travel insurance policy is going to agree to cover every possible situation. If they did, premiums would become incredibly expensive for everyone in order for there to be enough money available to meet all the claims!

Every policy has exclusions - either specific and that apply to a particular part of the policy eg medical, delay, cancellation etc or general exclusions that apply to every section.

The kind of things that generally aren't covered by travel insurance are if you miss connecting flights, so you won't be able to claim for irrecoverable travel and accommodation costs related to the missed flights. Travel insurance generally covers missed intial outward and final return flights.

Claims won't be met where someone has contributed to the cause of the claim. For example, if someone is drunk and requires treatment (either solely because of being drunk or because they've consequently injured themseves) this won't be covered. Similarly, if you've been negligent and haven't taken reasonable care to look after you luaggage per personal items, no policy will meet a claim for lost or stolen items.

Most policies have a maximum level of cover for each valuable item eg electrical items such as laptops, iPods, mobile phones etc as well as jewellery, watches, spectacles. You may be better covered under a home contents insurance where items away from home are covered and often on a replacement value basis.

It's therefore important to read the policy wording to check what the policy is covering you for.

Why take out travel insurance if you have a European Health Insurance Card (an EHIC)?

A European Health Insurance Card merely puts you in the same position as an insured person in the country you're visiting. It doesn't necessarily mean that any treatment or medication you need will be free.

The EHIC covers you only for medical treatment. It won't cover you for things like:

• Cancellation - if you become ill before you travel and have to cancel your trip. You will lose what you've paid for travel and accommodation.
• Repatriation to the UK on medical grounds. This can be expensive, especially if you need to book alternative travel. If you need an air ambulance (and yes, it does happen!) the costs run into many thousands of pounds.
• Delayed or missed departure - travel insurance will pay an amount for these situations.
• Trip abandonment - if you're delayed for longer than 24 hours, you can choose to abandon your trip and make a claim for lost travel and accommodation costs.
• Lost or stolen baggage and personal items - as long as you have reported the incident to the police, you can make a claim on your insurance policy.
• Loss of passport or other documents.
• Loss of cash.
• Public liability - where you may be sued if you injure someone else.