If you're planning an overseas holiday, travel insurance should be an essential. It can help cover the cost of accidents, illness and delays while travelling.
Types of travel insurance
When you're choosing travel insurance, think about your travel plans and what you'll need cover for.
If you’ve been affected by military strikes in the Middle East, visit the smarttraveller website for instructions on what to do.
Direct from an insurer
Most travel insurance policies will cover you for:
- medical (level of cover varies based on pre-existing medical conditions)
- cancellation and delays
- lost or stolen baggage
- car hire
Your level of cover will change depending on whether it's international or domestic travel. Remember to read the product disclosure statement (PDS) carefully to make sure you're getting the right type of cover.
Credit card travel insurance
Some credit card providers also offer insurance for overseas travel. This is sometimes advertised as 'complimentary' insurance. Often it is included in the credit card's fees (like the application fee or annual fee) or its interest rate.
Usually, you need to pay for a certain amount of travel costs with your credit card to be covered. For example, pay for your return flight or your accommodation. Each policy is different, so make sure you check with your provider.
Check the PDS to make sure this kind of policy suits your needs. Insurance through your credit card may only cover the cardholder (not your spouse, children, or additional cardholders). Generally, it will only cover you for the trip you have paid for on your credit card.
Before you travel anywhere, visit the smarttraveller website to check out the government’s travel advice for the countries you’re thinking about. If the smarttraveller advice is ‘do not travel’, your insurance policy usually won’t cover you.
Choosing a travel insurance policy
What to look for when choosing a travel insurance policy:
Premium and excess costs
Make sure the insurance premiums fit within your budget. And check you can afford to pay the excess if something does go wrong.
Policy inclusions and exclusions
Think about where you’re travelling and what activities you’re planning. Make sure they're included in the policy.
Exclusions often apply to:
- acts of war, conflict, terrorism and some natural disasters
- 'high risk' activities, such as parachuting, abseiling and riding a motorbike
- illness or injury caused by pre-existing medical conditions
- pregnancy-related costs
- loss or theft of unattended luggage (check your insurer's definition of 'unattended')
- claims for travel to areas where an official travel warning has been issued
- losses incurred due to the financial failure of an airline, hotel, travel operator or agent
- pandemics and outbreaks of infectious diseases
Your actions count, too.
It’s important to know that even if your travel insurance policy covers something (for example, breaking your leg), your insurer might decline your claim if at the time it happened you were drunk, affected by drugs or doing something illegal. It’s always important to check your policy details!
Health and age restrictions
You may need to disclose pre-existing physical and mental health conditions when you apply for an insurance policy.
The insurer may choose to cover these conditions, cover the conditions for an extra cost, or exclude these conditions from your cover.
Check whether the insurer will cover any pre-existing health (including mental health) conditions you declare before you take out a policy.
Also check that the policy covers your age and the ages of those travelling with you.
Making a claim on your travel insurance
Make sure you know how to lodge a claim with your insurer before you travel.
Register the claim as soon as you can. Some insurers require you to inform them of any incidents within 24 hours.
If you're unsure if you're covered, contact your insurer and consider lodging a claim. If you make a claim, your insurer will assess whether your loss is covered.
Talk to your insurer about how to provide evidence to support the claim. Documents you might be asked to provide could include:
- Proof of travel — to verify the details of your trip, for example flight details, itineraries and hotel confirmations.
- Doctor's report — to prove you became sick or injured while travelling. Written confirmation should be provided by a qualified medical or dental professional.
- Police report — to prove that the incident was reported to the police. If something is stolen, you are injured or are the victim of a crime, get a copy of the police report.
- Valuations and proof of purchase — to prove that you own the item that was lost or stolen, and confirm how much it cost. This applies to items you take with you on your trip and anything you purchase along the way. Before you leave home, take photos and record serial numbers of any expensive items you're taking with you.
It's important to be honest with your insurer about the events and circumstances when lodging a claim.
The General Insurance Code of Practice sets out what insurers should do to handle claims. If they don't meet these standards you can complain to the insurer.
If you can't reach an agreement, contact the Australian Financial Complaints Authority (AFCA) to make a complaint and get free, independent dispute resolution.