Delaying arranging your travel cover could prove a costly mistake.
Over five million* people will make their summer holiday bookings before the end of February with the third week in January traditionally being the busiest for those wishing to combat the winter blues**. However, Gocompare.com is warning holidaymakers not to leave arranging their travel insurance to the last minute or risk losing some valuable cover.
Although many travellers would say their main reason for buying travel insurance is for the medical cover or to protect their luggage, travel insurance can also provide protection against events affecting you before you even leave your home. Around 34% of travel insurance claims made by UK holidaymakers in 2012 were for costs related to cancellations with an average claim value of around £700, second only to the average medical costs claim of £900***.
However, because travellers are only covered for events they didn’t know about before buying their insurance, the sooner they buy the policy, the more likely it is they’ll be covered if something goes wrong before their holiday starts.
Gocompare.com found that cancellation cover is standard on 96% of the 452 single trip travel insurance policies with some comprehensive policies covering up to £10,000, with some even offering unlimited cover per insured person. Cancellation cover would allow the holidaymaker to reclaim the costs of their holiday, up to the cover limit and minus any excess, should certain circumstances arise before taking the trip. These may include a serious illness or injury affecting someone in the travelling party or a close relative, such as a parent, child or sibling, who isn’t travelling but with whom they would like to remain at home.
Having a major incident such as a serious fire or flood at home may be another genuine reason why you might want to cancel or postpone your holiday, but may be covered for under your travel insurance policy. Also, being called up for jury service isn’t something you can usually turn down just because you’re off on your holiday but if you didn’t know about it before you arranged your insurance you may be able to reclaim some or all of the costs of cancelling or postponing your trip.
Caroline Lloyd, travel insurance expert at Gocompare.com, said: “Holidaymakers have to bear in mind that they cannot insure themselves against an event taking place or circumstances arising which they were already aware of. If a family member becomes seriously ill in the lead up to your holiday you cannot then take out travel insurance with the intention of cancelling your trip. Likewise you cannot hear about potential serious disruption to your travel plans, such as that caused by striking airline staff and expect to be able to claim if you subsequently decide to change your plans. The insurer will check when you could have first become aware of the potential disruption to your holiday before deciding whether your claim is genuine.
“So even though it may be several months from when you book your holiday to when you actually travel, it’s a good idea to take out your travel cover soon after you book your holiday rather than leaving it until just before you go. That way you’ll benefit from any cancellation cover provided by your policy as soon as you buy it, giving you several months of valuable protection in the lead up to your trip rather than just the week or two of your actual holiday if you leave it late. It’s a false economy to delay arranging your travel insurance.
“Cancellation cover is a frequently overlooked benefit of travel insurance compared to say medical costs cover. But as figures from the ABI show, it helps hundreds of thousands of consumers reclaim cancelled holiday costs every year. Cover levels vary greatly from policies offering no cancellation protection at all to unlimited cover per insured person so make sure you choose the right travel cover for you based on the protection you want rather than the policy with the lowest premium.
“One final money saving tip - don’t be so rushed that you buy your holiday operator’s packaged cover though. It’s usually one of the most expensive ways to get travel insurance and you should be able to find a better value deal quickly by comparing policies online.”
Notes to editors:
On 17 December 2013, Vision Critical conducted an online survey among 2,005 randomly selected British adults who are Springboard UK panellists. The margin of error-which measures sampling variability-is +/- 2.2%. The results have been statistically weighted according to the most current education, age, gender and regional data to ensure samples representative of the entire adult population of United Kingdom. Discrepancies in or between totals are due to rounding.
*5.25 million figure is based on 11% of the UK adult population planning to book their main summer holiday in January or February 2014 (the UK Adult population (+18) is estimated to be 47,755,246, according to Experian’s Demographic Summary). Therefore 11% of 47.7 million is 5.25 million.
**source - ABTA
***source - ABI Travel insurance statistics update – July 2013
Travel insurance source Source: Defaqto Matrix – instant and unbiased market and competitor intelligence, from independent financial research company Defaqto data effective as of 30 December 2013