Heading away and don't want to overpay for travel insurance? Read these key steps to save
Travel insurance is important, but that doesn't mean you have to overspend. Dodge these easy-to-avoid traps and get more for your travel insurance dollar.
1. Are there any coupons, sales or deals?
This might seem like an obvious point but it's worth highlighting. Travel insurers are constantly offering coupons, discounts and bonus offers to win your business by helping you save. Keep an eye out for these offers as many are for a limited time only. These deals range from premium reductions to bundled policy discounts to free global SIM cards. Check out deals currently offered on finder.com.au
2. Is a basic policy enough for your trip?
Most insurers offer three levels of cover – basic, essentials and comprehensive. It's worth reviewing each of these levels to make sure the policy you're looking at suits your cover requirements. If, for example, you already have cover in place, you may only require the reduced level of cover offered by a basic policy.
Australia is part of the Reciprocal Health Care Agreement (RHCA), which means you have access to basic healthcare in countries such as the UK (similar services to those offered by Medicare), should you need emergency medical or hospital treatment. As a result, you may not require a policy that offers a high level of medical coverage.
3. Frequent traveller? Annual cover could be a smart fit
If you travel multiple times each year, you may be overpaying for your travel insurance. Taking out multiple individual policies rather than one policy for all of your tips for a year could be costing you a bundle. Annual travel insurance covers you for an unlimited amount of trips in any 12 month period. The duration of cover for each trip is limited under an annual travel insurance policy, normally between 30 and 60 days, but these limits vary between providers. Annual travel insurance is best suited to frequent travellers and those who have to travel without much notice.
4. Is buying through your travel agent or airline costing you more?
Some travel agents and airlines add a commission on top of the price of each policy, which can end up leaving you significantly out of pocket. In fact, a finder.com.au study found that you could end up paying more than three times as much than if you bought you travel insurance from travel agents or airlines versus going directly to the insurer. This is because some travel agents and airlines add commissions and fees to the base cost of the policy. For example, the survey looked at the cost of travel insurance for a family of four going on a 21-day trip to the USA. Getting comprehensive cover through a travel agent cost an average of $618, where as the average cost of cover through one of the direct providers on finder.com.au was $215.25.
While these findings are not indicative of all travel agents or airlines, there are travel agents and airlines out the who don't add on excessive commission (some even price beat the quotes you've found online), it does go to show that you've got to compare your travel insurance options – both offline and online.
5. Need to claim? Avoid a hefty excess charge
The lower your policies premium, the higher the excess if you make a claim. With some excess on policies reaching up to $250 for a single claim, it could be worth opting for a policy with an excess waiver. This option allows you to waive any excess charges by paying an upfront fee. The cost of excess eliminator varies but is normally between $15-25. If you choose this option, you can save yourself hundreds in the event of a claim.
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More travel insurance traps to watch out for
- Avoid buying the first policy you come across. Shop around for the right policy and compare the features of a number of products. Browse product disclosure statements so you know the limits, sub limits and exclusions of each policy. Doing this will help you determine which policy has the cover you need. It’s also incredibly quick and easy to compare travel insurance quotes online, which can help you find a better deal.
- Beware of excess amounts. The excess charged on most travel insurance policies generally varies from $50 to $250.
- Read the fine print. Some insurers make you pay multiple excesses when you make claims under different sections of a policy, even if they are for the same event. Read all policy documents closely to avoid this problem.
- Watch out for family policy limits. When you’re insured under a family policy, your insurance has a set limit that is paid for claims, which is a combined figure not a per-person figure.
- Beware of rental vehicle excess exclusions. Many travel insurance policies cover the excess charged by rental companies when your rental car is involved in an accident, stolen or damaged. However, you’ll be excluded from cover if you don’t have a driver’s licence, you were under the influence of alcohol or drugs, or you violated your rental agreement.
- Beware of warnings. Travel insurance brands exclude claims relating to travel to countries that the Department of Foreign Affairs and Trade (DFAT) has issued a DO NOT TRAVEL advisory.
Save with these discounts featured on finder.com.au
One of the simplest ways to stop paying so much for travel insurance and cut costs is to go online and look for promo codes and other discounts.
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