Double insurance - what does it mean for you?

What is double insuring?

Doubling up on insurance means you have insurance cover from two different policies for the same thing.

For example, if you have a paid-for packaged bank account or a credit card, you might be offered travel insurance as part of the deal.

If you didn't know and then bought separate travel cover as well, you’d end up with two policies covering the same thing.

Does double insuring mean I’ll get paid more if I make a claim?

No. If you have two travel insurance policies, each insurer will only pay their share of the claim.

This is outlined in a section called the ‘contribution clause’ in your policy documents. It explains the share your insurer will pay in this situation.

What happens if I'm double insured and why's it a problem?

If you need to make a claim, and you have two insurance policies, one insurer could ask the other to make a contribution. This delays claims.

The insurers would then work out a proportionate amount of excess for each policy, which is the amount you’re asked to contribute towards your claim.

The big drawback of this is that it effectively means you’d be making two claims.

You have to declare previous claims on future applications for travel insurance. You'll have to declare two, rather than one. Which means your insurance premiums will go up, and potentially by more than if it were just the one claim.

Travel insurance through your bank account or credit card

“It’s essential that you know what insurance you have in place and whether you need additional cover,” said GoCompare’s travel expert, Sally Jaques.

“If you’re off on a skiing trip or planning a long-term break, you might not have enough cover from your bank account’s travel insurance policy.”

When it comes to finding the right travel insurance policy for your needs, check:

• What you’re covered for
• Whether you have enough cover
• What the excesses are
• Whether the country you’re travelling to is included
• What the insurer’s contribution clause is and how you would be affected if you need to make a claim

When is double insuring ok?

Life insurance is the exception, as you can get multiple policies to cover different financial responsibilities.

Some other insurance policies will have an ‘excess clause’. It means you might be able to claim from a second insurance policy if the total amount of your claim exceeds the cover limit of your first policy.