Travel Insurance

OK, we get it. Travel insurance seems like a bit of a waste of money......funds better spent on a few extra beers........ or a white-water rafting/bungee jump combo. Like we said, we get why glossing over the need for travel insurance is super-tempting. And that is probably what the few thousand backpackers every year thought too before they found themselves suddenly facing debts of thousands or perhaps sick on a serious scale and stranded far from home. Cutting corners and taking risks is all part of being young and having fun but wherever else you might be tempted to do that don't let it be with your travel insurance. Unless, of course, you have mega rich relatives.

Travel insurance is not just a compensation scheme for losses and inconveniences or something to pay medical bills - it is a shoulder to lean on in times of crisis. If you've just lost everything including your passport in a robbery; got sicker than you ever thought possible or faced having to get back home in an emergency you are going to be vulnerable and desperately in need of support. The best travel insurance policies are all about giving you the support of professionals - both practically and emotionally - when you most need it. 

Backpackers' insurance - and endless companies to supply it - are as common these days as grass thanks to an ever-growing host of folk looking at taking gap years, career breaks and travelling longer term. That means lots of competition and wonderfully comprehensive cover for relatively little, aimed at a market who probably intend to do all kinds of crazy things. However, not all policies cover all activities and sometimes extra is charged if you intend to ski or scuba dive for example. Be sure of what activities are and are not covered by what you are looking to buy.

We grant you sifting through insurance policy wording can be tedious in the extreme but it is important you understand what all that mumbo-jumbo means. Here we try and help you understand each aspect of the typical policies around so you can be sure you end up with the perfect policy for your totally individual adventure.

The Basics

• Cancellation – This is for eventualities where, for whatever reason, your planned and paid for trip never gets off the ground. Be aware – Compensation in part or full won't be paid for events happening weeks before if your insurance policy starts on the day you were due to fly. To cover yourself for this eventuality you will have to start your policy as soon as you pay for flights etc.

• Curtailment of trip – This is if your trip is cut short – usually because of something unpleasant happening to loved ones back home. Be aware – Should the reason for your returning home be due to illness/death of a relative you may be asked to show that any medical diagnosis or development of an illness was after you departed or risk non-payment.

• Delay – Flight delays are more annoying than costly but insurance policies will typically compensate you for wasted time and usually accrue from 12+ hours. 

• Lost or delayed baggage – By no means an uncommon occurrence, the event of non-arrival of checked baggage will see you having to fork out for clothes, toiletries and who knows what else until your bag catches up with you – not fun unless you have an insurance policy which will pick up the bill. Be aware – Policies typically have limits and individual item limits too so don't expect to get full compensation should you have packed all kinds of expensive electronics in your lost bags.

• Personal possessions – Cameras, gadgets, phones, clothes, jewellery, money, passport, backpack and anything else you might have brought on your trip are usually covered should they be stolen, lost or damaged.

Fine Print

Of all insurance policy categories this one tends to have the most fine print exceptions to be aware of.

• Watch out for single item and overall limits for compensation as already mentioned previously.

• Stolen items typically require either a police report or some evidence of having reported the theft and also within a set time limit.

• You have a responsibility of due care and attention. So, should you have left your phone on a table at the hostel while you popped to the loo and come back and find it missing you are unlikely to find your insurance company will pay out.

Medical and Personal Liability Cover

Up to this point all we've covered is, generally speaking, about annoying inconveniences and cash losses - some of them potentially hefty - but nothing measures up to the scale for potential disaster quite like the medical and personal liability areas.

• Personal liability – This category, which usually starts around the £1 million point, is designed to foot the bill for you should you accidentally damage another individual or their property. Otherwise just hope some-one you know has hundreds of thousands lying about which they are happy to give to you.

• Medical costs – Medical attention in New Zealand is not free although the UK and New Zealand do have a reciprocal healthcare agreement. Quite what your bill may be will depend on what kind of medical treatment you need. To illustrate quite how hefty the costs could be in serious situations let us tell you that amounts covered on insurance policies typically start around the £2 million mark for destinations outside of Europe. Be aware – Pre-existing medical conditions before travelling don't automatically exclude you but you must be certain to discuss this with your insurance company or risk claims being null and void.

The Other Stuff

• Excess – If your excess is set at £200 this means no payment will be made until any costs incurred exceed this figure. Almost all policies have some kind of excess but they vary considerably and may even switch from section to section of your policy. Generally, the bigger the excess, the smaller the initial insurance premium payment will be for you.

• Working holiday – Medical health insurance is mandatory in New Zealand if you want a working holiday visa. Be aware however that there are insurance policies out there which automatically exclude anyone intending to work and this often includes voluntary work too.

• Exemptions – Exhilarating reading it might not be but check all exemptions listed on your policy and check all the hidden corners too because some of them tend to tuck themselves away.

• Personal responsibility – There's probably not an insurance policy going that doesn't expect you to assume a level of care with regard to your personal safety and of course how this is defined may vary from company to company.

• Drugs and alcohol – This is another almost universal no-no with insurance companies. Problems arising from drugs and alcohol, including any mishaps which occur while you're under the influence of them, won't be paid for.

Making a Claim

Should you find yourself at any point in a situation which will lead to an insurance claim make sure you gather and keep anything relevant you can – originals of receipts, tickets, reports etc.

It is always a good idea to give a copy of your policy to some-one back home and also inform them of any emergency contact numbers relevant too.

Bargains in Disguise

Instant insurance quotes online will throw back a bewilderingly wide price range of possibilities and it is of course an automatic response to pick whichever is cheaper. However, as is true in other areas of life, you get what you pay for; this apparent bargain may come with ridiculously high excesses, a mammoth helping of exclusions and so many clauses it would only ever pay out in the event of aliens invading from Mars. In other words – perfectly useless. Having said that, sometimes identical or almost identical policies from two different companies may vary hugely in price so of course the cheaper of them is a bargain. A little careful sifting is worth it.