Overseas travel is no longer a privilege confined to the lucky few to be taken once every summer. In fact, flying has become so steeped in our culture that an increasing number of Britons are even investing in permanent holiday homes abroad.
Data from specialist overseas mortgage broker Conti Financial Services, revealed a 20% increase in mortgage quotes issued during September, following the summer holiday period for example.
Home from home?
Once you, or even a close friend or family member, becomes the owner of a second home, it makes practical and financial sense to use it at every opportunity. But a survey from Gocompare.com* has found that, as soon as travellers feel they have ‘roots’ abroad, travel insurance goes out of the window.
It found that travellers heading for a holiday home owned by either themselves, a friend or a family member, are a staggering nine times more likely to travel without insurance than someone heading off on a traditional package holiday. Even a quarter of parents travelling to familiar holiday homes during the recent October half term did so with no travel cover in place.
The importance of travel insurance
But the type of accommodation you are destined for has little bearing on things that can – and do – go wrong when abroad. If you fall ill or have an accident for example, medical expenses can run to thousands of pounds and, if you need to be repatriated home, this sum could actually reach tens of thousands. In other words, without insurance, you could end up in the farcical position of having to sell your holiday home to fund your health and safety.
Tighter finances during the recession has made matters worse according to a report published recently by Nationwide, which found that more travellers to countries within the EU are now choosing to rely on their European Health Insurance Card (EHIC) as a replacement for travel insurance.
But all the EHIC entitles you to is basic state-provided medical healthcare at a reduced cost and treatment that’s on the same terms as insured nationals of the host country. You won’t get medical costs paid for, private treatment, repatriation or cover for non-medical problems such as lost luggage or theft of property.
Buying the right – not the cheapest – travel policy
But while travel insurance should be a must, the cheapest deal may not always be the best. However, according to research from specialist travel insurer PJ Hayman price is still the most influential factor for travel insurance shoppers, with 20% placing it at the top of their priority list.
But while it’s always sensible to shop around and compare premiums, you will need to be especially vigilant about reading a policy’s small print before buying – something that, according to PJ Hayman, only 38% of travellers do.
Getting to grips with the finer print
For example, pre-existing conditions are a common sticking point and, especially for older people, may not be covered. You will have to disclose all medical conditions on your application for your policy to be valid. But if the insurer won’t play ball, you may have to turn to a more expensive, specialist alternative.
Check out the level of excess the insurer sets down in the policy, and whether it applies as one the total claim or for each item. Bear in mind also that stolen or lost cash may not be covered by your insurance company. Some companies, such as AA Travel Insurance, Go Travel Insurance and Etravelinsurance, will cover personal money but you should always check with your provider if you are unsure about the levels of cover that are provided.
Make yourself aware of any limit set on individual items – if you are taking expensive jewellery for example. However, your household insurance policy may also cover ‘personal possessions away from the home’ so it’s worth checking you haven’t doubled up on cover unnecessarily. Some policies such as AA Travel Insurance will allow you to exclude personal belongings and money cover for this reason, providing increased flexibility for travellers.
Sporting activities, such as white water rafting or bungee jumping may not form part of standard travel policies, so you may have to pay a small amount extra for this kind of cover. In fact, even if you are just taking a short ski break you will need to seek out proper cover for this type of holiday and purchase a winter sports policy.
It might seem frustrating and unfair but delays and strikes by airlines and travel companies are not usually covered by travel insurance policies. However if you put the cost on a credit card – even if it’s just the deposit – you will be covered by the card provider under the Consumer Credit Act. That is, so long as the cost of your trip is between £100 and £30,000.
Finally, remember that if you travel abroad more than a couple of times a year an annual policy is likely to represent better value than paying as you go along. This will also mean year-long peace of mind should you embark on any impromptus trips.
However, don’t assume when your annual travel policy comes up for renewal that it will present the best value the following year too. Shopping around, checking cover levels and potential pitfalls as you do so, will provide the best basis for the start of any trip this Christmas and beyond.
*1601 UK adults surveyed in July 2009 by Loudhouse Research