A CHOICE review of travel insurance finds traps for the unwary
In the lead up to summer holidays CHOICE advises older travellers, pregnant travellers and adventure travellers to be extra vigilant when choosing travel insurance as these groups often face many exclusions around pre-existing medical conditions, conditional age and outdoor activities.
A CHOICE review of 89 travel insurance products¹ found significant differences between the policies particularly when it comes to cover for mental illness such as dementia, anxiety and depression and people aged over 65 years. Some insurers exclude cover for pregnancy altogether.
For adventure travellers, cover for specialised activities such as skiing are often not covered unless you opt for an extra premium provided.
“Only 30% of disputes that reach the Financial Ombudsman Service decisions stage are resolved in favour of the applicant. Choosing the wrong policy can almost be as bad as none at all – so you need to know what you are buying,” says CHOICE spokesperson Ingrid Just.
The CHOICE review also found some policies won’t pay claims for travellers who fail to follow travel warnings from government or regulatory authorities or the financial collapse of an airline or tour provider. Most won’t cover valuables such as laptops, cameras or jewelry when they are checked-in or left in a vehicle.
“Many policies cover the cost of travelling home in the event of a relative dying but definitions of relative vary, age limits can exist and often the deceased has to be a resident of Australia or New Zealand,” says Ms Just.
The CHOICE review identified the best insurers for these types of travellers:
Pregnant Travellers: Good2Go; Chartis, Defence Health, Columbus Direct
- All cover for pregnancy up to 26 weeks (Columbus Direct will cover 30 weeks with an additional premium).
Older Travellers: Allianz, Medibank, Covermore
- Ranked best for travelers over 65. A range of pre-existing medical conditions are covered without extra fee or assessment.
Adventure Travellers: Medibank, Covermore
- Cover the widest range of activities and may include abseiling, ballooning, bungee jumping, canyoning, horse riding, paragliding, scuba diving, sky diving and white water rafting.
“It’s easy to fall into the trap of day dreaming about the animals you will see on an African Safari or the fun you will have motoring around on a scooter in Bali rather than taking time reading the 15,000 words in a policy document. However taking extra time to read the exclusions and inclusions may prevent that dream holiday turning into a nightmare,” says CHOICE spokesperson Ingrid Just.
CHOICE tips for buying travel insurance:
- Read ‘general exclusions’ and ‘policy cover’ and ‘pre-existing conditions’ sections carefully, especially if undertaking adventure travel or if you have particular medical needs.
- Check the ‘word definition’ table as it may contain some tricks of the policy (i.e. the definition of the term ‘relative’).
- Search online, compare quotes and policies and haggle for better price
- If you travel regularly check whether an annual policy might be suitable and cheaper.
- Look for special ‘member’ offers if have another insurance policy with the same provider (i.e. health or home and contents insurance).
Read CHOICE's full report into travel insurance.
¹Twenty-two insurers participated in the CHOICE survey which covered 89 policies. Webjet was unable to take part as its Product Disclosure Statement was being re-written. Travel Insurance Direct, World Nomads, Cheap Travel Insurance, Suresave and Budget Direct all declined to be involved. Travel insurance policies were scored according to cover for medical, cancellation, personal liability, terrorism and natural disasters. Baggage, Travel delay, pandemics and insolvency and the cost of the premium were also taken into consideration.