Domestic Travel Insurance

Why you should pack travel insurance for your next trip within Australia.

Who wants to think about insurance when you've got a fun trip to plan? But even if your most strenuous activity is going to be laying on a beach, unexpected situations such as having your flight cancelled, your rental car damaged or your luggage stolen could ruin your trip, or leave you with significant out-of-pocket expenses. Getting domestic travel insurance can help give you peace of mind so you can relax knowing that you'll be covered when you hit the road for your all-Aussie adventure.

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Why do I need domestic travel insurance?

You’re planning a holiday here in Australia, a country where you speak the language, understand the culture, know how things work and may have lived your entire life – so why do you need travel insurance? After all, medical expenses – a critical cover feature on international travel insurance policies – are covered by Medicare or your private health fund, so what’s the point of taking out travel insurance for a trip within Australia?

Here are several reasons why you should consider domestic travel insurance before you hit the road:

• Cancellation costs. Sometimes life conspires against you to wreak havoc with your holiday plans. You might lose your job, a relative may die unexpectedly, or a serious injury or illness might leave you medically unfit to travel. When circumstances beyond your control turn your holiday plans upside down, travel insurance can cover any cancellation fees charged or any non-refundable pre-paid deposits.

• Luggage cover. Regardless of whether you’re in Frankston or Frankfurt, Newcastle or New York, airlines anywhere can lose your luggage. Your baggage and personal items could also be stolen or accidentally damaged, but domestic travel insurance can provide the protection you need.
• Theft. When you’re visiting popular tourist attractions or spending times in busy public areas like airports and train stations, theft is always a risk – especially if you’re unfamiliar with your surrounds. Happily, domestic travel insurance can protect you against any financial loss.
• Travel delay and cancellation. According to statistics from the Bureau of Infrastructure, Transport, and Regional Economics, 84.2% of domestic flights within Australia in 2016 arrived on time, while 1.7% of all flights were cancelled. Travel delays and the unexpected cancellation of flights are real risks when holidaying in Australia, but travel insurance guarantees that you won’t end up out of pocket if they happen to you.
• Rental vehicle excess. If your rental vehicle is crashed, stolen or maliciously damaged during your trip, the insurance excess charged by the rental company could be a few thousand dollars or more, compared to the car hire excess included in most policies. This can leave a massive dent in your holiday spending money, which is why the cover provided by domestic travel insurance is well worth the investment. Car hire excess insurance bought on its own also tends to be more expensive than buying domestic travel insurance, as seen in the table below:

Cost of car hire excess insurance vs. domestic travel insurance*

_{*The cost of domestic travel insurance is an average based on quotes for a one-week trip. The cost of car hire excess is based on an average online cost for one week, with quotes from VroomVroomVroom. These prices are not indicative of all policies and are to be taken as a rough guide. Prices are correct as of January 2018.}

10 things that could go wrong when you're travelling within Australia

What does a domestic policy normally cover?

Domestic travel insurance policies usually include the following benefits:

• Luggage and personal items. If your luggage or personal belongings are lost, stolen or damaged during your trip, you’ll be covered for the cost of their repair or replacement.
• Luggage delay. When your luggage is delayed or misplaced by an airline or other carrier, you’ll receive an emergency allowance to help you buy toiletries, clothes and other essentials.
• Cancellation fees. When unforeseen circumstances outside of your control (including involuntary unemployment, natural disaster, death of a relative etc) force you to cancel your trip, travel insurance provides cover for your cancellation fees and lost deposits.
• Travel delay. This benefit covers the cost of additional meals and accommodation when your pre-booked transport is delayed.
• Money. You’ll be covered for the theft of money from your person.
• Additional expenses. This benefit covers your additional accommodation and transport expenses when your trip is disrupted by an unexpected event, such as:

• If you suffer an injury or illness and are medically unfit to continue your journey
• If a relative or business partner falls ill and you must return home
• If your home is destroyed by fire, earthquake or flood
• If your scheduled transport is delayed due to riot, strike or civil commotion
• If a natural disaster occurs

• Loss of income. If you’re injured during your trip and unable to go back to work when you return home, domestic travel insurance can provide cover for your lost income.
• Personal liability. If you’re legally liable for causing accidental injury to someone else or damaging their policy, travel insurance can provide financial protection.
• Rental vehicle excess. This benefit provides cover for the insurance excess payable to a car rental company when your hire car is stolen, damaged or involved in a collision. NB: rental vehicle excess cover is only available as an extra-cost option on some policies.
• Disability. If you suffer an accidental injury during your trip that causes total and permanent disability, many policies provide a lump sum benefit.
• Accidental death. Your loved ones may be entitled to a lump sum benefit if you die as a result of an accidental injury sustained during your trip.

What additional options are available?

Many insurers will also allow you to add the following options to your policy for an additional premium:

• Snow sports cover. If you’re planning a skiing or snowboarding holiday, adding this optional extra to your policy ensures that you will be covered if you injure yourself while participating in snow-based activities. It also provides protection for stolen and damaged ski equipment, ski equipment hire, and unused lift passes when your trip is disrupted by circumstances beyond your control.
• Adventure sports cover. If you’re a thrill seeker planning to indulge in a few adrenaline-pumping adventure activities during your trip, you may need to add optional adventure sports cover to your policy to cover a wide range of sports and activities. It allows you to extend your cover to include activities like rock climbing, trekking, white water rafting, parasailing and more.
• Cruise cover. Planning a cruising holiday? If so, adding optional cruise travel insurance to your policy ensures you’re covered for medical expenses incurred onboard, medical evacuation to the nearest facility on dry land, and cabin confinement for medical reasons. It also covers missed shore excursions, lost or damaged formal cruise attire, trip cancellations and delays, and lost or delayed baggage.
• Increased item limits. If you’re taking expensive items (such as laptops, jewellery and cameras) with you on your journey, their value may exceed the maximum limit your insurer will cover for any one item. However, this extra-cost option allows you to increase the level of cover available for specified items, ensuring that they’re adequately protected on your trip.
• Increased rental car excess cover. This option allows you to increase the level of car rental excess cover provided by paying an additional premium.

What’s not normally covered under your policy?

Before choosing a policy, make sure to check the list of general exclusions contained in the PDS. This lists the circumstances and events when your policy does not provide any cover, such as:

• If your claim arises due to a pre-existing medical condition which is not covered by your insurer
• If your claim is for costs incurred outside of Australia
• If you fail to take reasonable care of your luggage or personal items
• If you intentionally or recklessly put yourself in harm’s way
• If your claim arises due to detention, confiscation or destruction by customs or other officials or authorities
• If your claim arises because you committed an unlawful act
• If you travel against medical advice
• If your claim arises due to childbirth or the care of a newborn child
• If your claim arises due to the insolvency of a travel agent, tour operator, accommodation provider, airline or other carrier
• If your claim relates to any conduct while you were under the influence of alcohol or drugs
• If your claim is for consequential loss of any kind, for example, loss of enjoyment
• If you change your mind about travelling

Check out our guide to travel insurance exclusions for more details of when your policy will not provide any cover.

How to save money on your policy

They say that if you can't afford travel insurance, you can't afford to travel. While the decision on what cover to take out should never be based purely on price, it is important to take the necessary steps to avoid overpaying for cover not tailored to your needs. Many people are surprised at how affordable domestic travel cover can be if they take the right steps to consider what they actually need cover for and weigh up the different options available.

There are several simple things you can do to reduce your domestic travel insurance premium, such as:

• Choose a lower level of cover. Some insurers offer budget domestic travel insurance policies that provide cover for cancellation costs and additional expenses when you’re forced to cut short your trip. These policies may be worth considering if you’re looking for affordable insurance but you still want cover against these potentially expensive risks.
• Choose a higher excess. You can reduce your premium by increasing your excess to a higher level. Just make sure that you’ll be able to afford the excess you choose should you have to make a claim.
• Look for discounts and deals. Keep an eye out for any special offers and deals to help you save money on cover. These could include special promotional offers, promo and coupon codes, discounts for buying cover online and discounts for customers who already hold another type of policy with the same insurer.
• Buy a joint policy. If you’re travelling with a family member or friend, you can both save yourself some money by purchasing a joint policy rather than individual cover.
• Don’t add options you don’t need. Extra-cost options can increase peace of mind when you travel and allow you to tailor a policy to suit your cover requirements. However, make sure you only add optional extras are essential for your holiday, as there’s no point in paying for cover you don’t need.
• Shop around. The final and also the most important thing you can do to save money on domestic travel insurance is shop around. Compare quotes from multiple insurers and take a close look at the features, limits and exclusions of each policy to find the best deal.

Is it worth it for domestic flights?

As Australia’s airlines offer increasingly discounted fares to compete for market share, you may be wondering whether the cancellation cover provided by domestic travel insurance is actually worth it. To find out, let’s take a look at a case study.

The day before Sarah is due to fly from Sydney to Perth for a two-week holiday exploring southwest WA, Sarah’s mother passes away unexpectedly. Sarah is forced to cancel her trip, which would ordinarily mean the $560 she has paid for her non-refundable airfares ($280 each way) would be lost.

However, when Sarah booked her holiday she also purchased a domestic travel insurance policy for $79.40, the average cost of cover for a two-week Australian trip. Compared to the $560 she would have lost after cancelling her flights, spending less than $80 on travel insurance seems well worth it.

To top it off, Sarah’s policy also covers cancellation fees and lost deposits for:

• Pre-booked accommodation
• Rental car hire
• Pre-booked tours

How much will domestic travel insurance cost me?

_{Cost of domestic travel insurance is an average based on policies for a one-week trip, for a 32-year-old traveller. Cost of the flight is based on the average online cost of a return flight from Sydney to Melbourne on 10 January 2018.}

How does travel insurance compare to the cover offered by my airline?

You may be aware of the fact that when you book flights for your holiday, you also have the option of purchasing travel insurance from your airline. However, airline travel insurance policies typically tend to offer a much lower level of cover than policies purchased direct from insurers. Check out the graph and table below to see just how airline cover compares with standalone travel insurance.

Airlines do have the option to purchase travel insurance through them. However, it's easy to see that the level of coverage is noticeably different when taking out an independent domestic travel insurance policy. The following chart highlights how airline cover sizes up against standalone travel insurance.

Jetstar vs Tiger vs Domestic Travel Insurance

Note: Cover amounts last checked 2016. Domestic travel insurance cover amounts are for illustrative purposes only and is not representative of all products in the market.

What will I actually be paid if my trip is cancelled?

Domestic travel insurance offers a cancellation cover to cover a range of pre-booked expenses in the event that you need to cancel your trip due to unforeseen circumstances.

What cancellations will you usually be covered for?

Under what circumstances can a trip be cancelled?

• • Unforeseeable death, injury or illness of relative that resides in Australia
  • You have to go to court or have jury duty
  • Accident in vehicle you were planning to use on a self-drive trip a week before you planned to travel
  • You are a member of the armed forces, police, fire, nursing or ambulance services and are required for duty
  • You are made redundant, provided you are eligible for redundancy payments as defined under current law
  • You need to stay home due to flood, fire, storm or burglary in your place of residence a certain period of time before you planned to leave

Traps to watch out for when choosing a domestic policy

Every year there are stories of people left devastated after learning their domestic travel insurance policy was unable to provide a benefit for their claim because it fell outside of what was covered in their policy. Be wary of these traps and pitfalls when searching for domestic travel insurance to cover your next Australian holiday:

• Underinsurance. Cost is always a consideration when buying travel insurance but looking to cut costs at every turn can lead you into trouble. Underinsurance could have significant financial consequences if something goes wrong on your trip, so make sure any policy you choose provides sufficient cover.
• Choosing the cheapest policy. While it is important to find a competitively priced policy, basing your purchase purely on price may leave you drastically under-protected. Research the policy features on offer and know what you are covered for. Cheaper cover will often have higher excess charges and greatly reduced benefit levels.
• Buying cover from an airline or travel agent. Buying travel insurance through an airline or travel agent when you book your holiday may be convenient, but it’s also usually unnecessarily expensive. Many airlines and travel agents add substantial commissions on top of the policy price, so you can save a lot of money if you buy cover directly from an insurer instead.
• Not reading the fine print. A travel insurance PDS is not what you’d call an entertaining read, but it is something you should examine closely before buying a policy. Look at the benefits, cover limits and exclusions to ensure that you know exactly what your policy does and does not cover.
• Per-item limits. It is crucial to know the conditions for payments for lost luggage and expensive items. While the policy may state "up to $5,000 cover for lost items", there may only be a benefit of $600 per item provided. These sub-limits are often applied to expensive items.
• Cover for the activities you plan to do on your trip. If you are participating in particular sports or activities on your trip it is important to find out whether or not they will be covered.

I travel often - should I get an annual multi-trip policy?

Searching for annual travel insurance to cover your trips within Australia? If you’re a frequent traveller, purchasing an annual multi-trip policy can be much more cost-effective than buying a separate policy for each trip you take.

Annual multi-trip domestic travel insurance provides cover for all the holidays you embark upon within Australia across a 12-month period. There’s usually a maximum limit on the length of each individual trip, but otherwise these policies provide all the benefits you would expect in an ordinary travel insurance policy.

• What are the benefits of taking out an annual policy? An annual policy can offer both convenience and great savings, as you will only need to apply for cover once and have the peace of mind that you are covered for all domestic journeys you take in any 12-month period. This option can be much more economical than applying for multiple policies over the course of a year.
• Who should consider an annual domestic travel insurance policy? An annual policy is only really suitable for people that travel 3 or more times per year. If you only need cover for 1-2 trips, it is probably more cost-effective for you to take out a single-trip policy. Most insurers will not provide annual policies to travellers over 60 years of age, as they need to assess any health risks that they may present. Annual policies are also a great option for people that need to travel last minute for business.
• Can I get an annual [policy to cover both international and domestic trips? Yes, it is possible to get an annual policy that will cover both trips within Australia and trips overseas. This could be a good option if you're looking to take a cruise trip but stopping off at Australian ports, your work sees you regularly travel both interstate and abroad or if you just love to get away both within Australia and overseas. It is important to note that not all insurers will cover both domestic and international trips so make sure you check the terms and conditions.

How can I get insurance for my caravan holiday?

Planning an Aussie holiday with your caravan in tow? If so, you obviously won’t need the cover for flight cancellation costs provided by domestic travel insurance, so is it worth your while purchasing a policy?

The answer really depends on what you have planned for your holiday. If you’ve pre-booked a lot of your holiday expenses – caravan sites, tours, ferry tickets (eg Spirit of Tasmania) etc – cancellation cover can still be useful. Other benefits, such as cover for theft, stolen or damaged personal items and trip disruption costs, could also come in handy, so it’s up to you to decide whether you need cover.

At the time of writing, there are no Australian insurers that offer a custom caravan holiday insurance product. Because of this, it’s also important to examine the cover provided by your caravan insurance policy. Comprehensive caravan insurance covers loss or damage caused by accidents, fire, storm, theft, malicious damage and more, so it’s worth reviewing your cover before hitting the road.

How to choose domestic travel insurance

How can you find the right domestic travel insurance policy at the right price? Follow a few simple steps:

1. Think about the cover you need. Do you want cover for the essentials only or ultimate peace of mind? Do you need to add any optional extras, such as cover for adventure sports or high-value personal items?
2. Consider your budget. How much do you want to pay for cover? Can you vary your excess to lower your premium, or take advantage of any other discounts available?
3. Get quotes. Once you have a better idea about the level of cover you want, obtain quotes from multiple insurers. This will help you work out how much cover costs and which insurers can help you save money.
4. Compare policies. Take a closer look at the benefits, limits and exclusions of any policy you are considering. This will allow you to work out which policy provides the best value for money and is the best choice for your Australian holiday.

Common questions when it comes to domestic cover

• Q. I’m already covered by Medicare...is domestic travel insurance really worth it?

  A. You might already be covered by Medicare or private health insurance but what about cover for cancelled flights, lost luggage, car rental excess charges. These are just some of the things a domestic policy can cover. With a two-week domestic policy starting at as little as $35*, it’s a little expense for great peace of mind.

• Q. Will I be covered by Medicare if I go to see a doctor in another state?

  A. Yes. Medicare will cover you regardless of what state you are travelling in.

• Q. How does it compare in price to cover from an airline?

  A. Airline baggage and ticket cancellation cover usually starts from around $15. For only about $10* more, domestic travel insurance can cover you for a whole range of other losses.

• Q. I am over 70. Can I take out cover?

  A. Yes. Most insurers will cover you if over 70 years of age. In some cases you may be required to submit details of your medical history in order to take out cover.

• Q. Can I extend my policy?

  A. Yes. You can contact your insurer while the policy is still active to request an extension. You may be required to provide reasoning for extension of your policy.

• Q. How long will it take to claim?

  A. This may vary between providers though generally claims can be settled within 10 days of the claim being made. In some cases the insurer may request further information, which may delay the claim further.

• Q. Can I wait till I return home from my travels before claiming?

  A. Yes. Provided it is within the required timeframe (usually between 30-60 days). That said, it is usually much less hassle if you just contact the insurer immediately so you know if you need to provide any further evidence.

• Q. Am I covered by home and contents insurance for lost items?

  A. Some home and contents insurance policies will provide you with cover for lost items even if you are travelling within Australia. If this is the case, your Home and Contents insurer may be liable to pay a portion of the claim.

• Q. Do I have to be a certain distance from my home for cover to apply?

  A. In most cases yes. Most insurers will require you to be at least 200km from your place of residence for your domestic policy to apply.

• Q. Cover on my credit card enough?

  A. Most credit cards don't offer cover for domestic travel, only for international trips. That said, there are some cards that will offer cover for cancelled flights, delays and missed connections under "inconvenience cover". Find out more about how credit card travel insurance compares to standalone cover.

• Q. Would I be covered for cancellation if I am unable to travel for work reasons?

  A. Trip cancellation for work reasons may be covered in the event of retrenchment or if you are required to work because you are part of an emergency service i.e. defence forces or fire-fighter.

• Q. I’m taking a cruise in Australian waters...is domestic travel insurance enough?

  A. You will not be covered by Medicare or Private Health Insurance for any medical related losses while at sea, even if travelling between Australian ports so it’s definitely worth taking out an international policy. Learn more of the benefits of cruise travel insurance.

• Q. Is Norfolk Island covered under domestic policies?

  A. There are no Medicare benefits for Norfolk Island so you will need an international policy. As an example, for the provider Covermore, this would fall under region Indonesia, South West Pacific, Norfolk Island and New Zealand.

• Q. Will my credit card cover me for domestic flights?

  Depending on the card, you are covered for cancellation of domestic travel arrangements if you must cancel for reasons outside of your control. Reasons include:

  • If you, or a relative passes away, becomes seriously injured or becomes seriously ill
  • You are quarantined
  • Participating cardholder or spouse is unexpectedly retrenched

  What you need to be aware of:

  • Travel arrangements must be booked using the credit card
  • A minimum spend on travel arrangements with card is required for cover to be activated
  • The excess tends to be higher than standalone policies with no option to remove the excess charge. The excess may end up being more than the price of your flight!
  • Personal computers, electronic equipment, jewellery or watches checked-in as luggage is usually not covered
  • Cover is usually not provided for business-related trips

• Q. Will my airline cover me if I have to cancel my flight for reasons outside of my control?

  • No, this is where it is important to consider travel insurance

• Q. Will my airline reimbursed my if my flight is cancelled or delayed?

  • If your flight is delayed or cancelled by the airline, they will attempt to rebook you on the next available flight on their services at no extra cost.
  • Alternatively, if the airline is unable to rebook you on the next flight, the applicable fare will be refunded
  • The airline will not be responsible for any additional cost that you incur as a result of cancellation. This is where travel insurance comes in

  The airline will not be responsible for any additional cost that you incur as a result of cancellation. This is where travel insurance comes in.

• Q. Will travel insurance cover additional expenses?

  • Most policies will cover additional meals and accommodation expenses following trip delay if your journey is disrupted due to reasons beyond your control

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*$23 quote price based on 40-year old traveller going to Melbourne for 7 days on the 20th of February 2018. Prices are indicative only and subject to change based on your individual details - please use the quote engine for the most accurate pricing.