What does travel insurance cover?

What you need to know

• A basic travel insurance policy will cover you for medical expenses but not much more.
• More comprehensive travel insurance policies can cover medical, luggage, cancellations, rental car excess and more.
• Travel insurance will not cover you for known events (e.g. a volcano eruption that has already been in the news).

What is covered by travel insurance?

Medical benefits

• Medical treatment for injuries or illness incurred overseas, including medical, hospital, surgical and nursing expenses
• Overseas medical assistance, including 24/7 assistance, ambulance fees, medical evacuation, funeral arrangements, messages to family at home and hospital guarantees
• Permanent disability e.g. a benefit payable for loss of sight in one or both eyes or loss of use of a limb within 12 months of an injury sustained on your trip
• Accidental death e.g. an accidental death benefit is payable if you die as a result of an injury sustained during your trip
• Dental expenses e.g the cost of emergency dental treatment, usually to a specified limit.

Transportation benefits

• Additional transport expenses following travel delays in order to reach events such as weddings, funerals, conferences and prepaid tours
• Cancellation fees and lost deposits e.g. cover for your prepaid travel arrangements is important when circumstances beyond your control such as illness, injury and natural disasters occur
• Disruption of journey covers the cost of additional meals and accommodation incurred after a delay if your journey is disrupted because of unforeseen circumstances beyond your control
• Family emergency covers the cost of additional travel expenses if your travelling companion or relative is disabled by an injury, requires hospitalisation or dies unexpectedly

A resumption of journey benefit protects you from the cost of airfares to resume your journey if it was disrupted due to the death or hospitalisation of a relative

Personal belongings benefits

• Replacement of luggage and personal effects if they are lost, stolen or damaged during your trip
• Replacement cost of lost or stolen credit cards and losses resulting from their fraudulent use
• Delayed luggage provides cover to buy clothing and essential items due to the delay, misdirection or misplacement of your luggage and personal items by a carrier for more than 12 hours.
• Cover for the theft of bank notes, currency notes, postal orders and money orders
• Replacement cost of lost or stolen travel documents such as passports, travel documents and travellers cheques

Personal benefits

• A hospital cash allowance provides a daily allowance if you are hospitalised overseas for longer than 48 continuous hours.
• Loss of income pays out a weekly benefit if you become disabled as the result of an injury sustained on your trip and are unable to work after returning home.

Liability benefits

• Personal liability covers your legal liability for injury or property damage to third parties, including legal costs and compensation.
• Rental vehicle excess covers the excess payable on your rental vehicle's insurance if it is stolen or damaged and the cost of returning it to the nearest depot if you are unable to do so.

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What do the different types of travel insurance policies cover?

The three main types of travel insurance are single trip, annual and domestic travel insurance.

Single trip insurance

Pros

• Some polices provide single trip cover of up to 540 days. Find out which insurers offer long term travel insurance.
• More affordable than annual travel insurance if you only travel a couple of times a year.
• If you have a pre-existing condition, you could find it's easier to get cover on a single trip policy.
• Higher age limits than those on an annual policy. Compare the age limits for single trip providers in our panel.

Cons

• You'll need to take out a new policy each time you travel.
• If you end up travelling a lot one year, you'll pay more than if you'd taken out an annual policy.

Annual travel insurance

Pros

• You're covered for multiple trips for a full 12 months with one policy
• Generally provides the same benefits as a single trip policy (though this can vary)
• Annual travel insurance can work out cheaper if you travel more than a hand-full of times a year
• Having one policy means you don't have to worry about insurance if you have to leave at short notice
• A useful option for business travellers who make plans at short notice.

Cons

• Generally, cover is limited to a maximum of 90 days per trip
• Maximum age of policyholder is less than single trip (often up to 75)
• Some policies don't extend cover for domestic trips
• Not always suitable for people with pre-existing conditions.

Domestic travel insurance

Pros

• Covers luggage loss or damage, trip delays and cancellations; and more
• Policies cover legal liability expenses, in case you get sued.
• Typically lower cost than international plans

Cons

• Will only cover you for trips within Australia.
• As we have Medicare, you'll not usually get the benefits of medical expenses

What isn't covered by travel insurance?

• If you travel to a do not travel country
• Known events (e.g. if you try to claim for something that you should have already known about, such as a volcanic eruption)
• If you leave your bags alone they are stolen
• If you try to claim for something while you are under the influence of alcohol or non-medication drugs
• Illegal acts while driving
• Claims arising from the confiscation, detention or destruction of anything by a government authority.
• Pre-existing medical conditions unless stated otherwise by your insurer
• Adventure activities considered to be high-risk such as skiing, sailing, rock climbing, contact sports, hang gliding and skydiving, unless additional cover has been obtained for them
• Underwater diving using scuba gear, unless you are with a licensed instructor or have a current Open Water dive licence.

Are pre-existing conditions covered by travel insurance?

What is covered?

• Conditions covered by travel insurance vary from insurer to insurer, but usually include conditions such as asthma, cataracts and gastric reflux.

What isn't covered?

• The conditions that insurers do not cover are also listed in the PDS and can include serious conditions such as cancers, heart disease and HIV.

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Frequently asked questions

• Will travel insurance protect me if an airline goes bust?

  Most travel insurance brands do not cover insolvency, collapse or default of airlines, travel agents, tour operators or accommodation providers.

  If you pay for your trip with your credit card, however, you may be able to claim through the insurance on that. Otherwise, you can try applying for compensation through the ACCC (Australian Competition and Consumer Commission).

• Does travel insurance cover alcohol-related incidents?

  Most travel insurance policies exclude claims for incidents linked to the excessive consumption of alcohol. Whether the consumption, and the actions stemming from it, were "excessive" is determined by the insurer.

• Does travel insurance cover mobile phones?

  Travel insurance provides cover for loss, damage or theft of personal belongings including tablets, smart phones and laptops. But you need to be aware that benefit limits apply and if you have expensive electronic items, you might want to consider taking out additional cover so you can replace them if necessary.

• Does travel insurance cover me if I need to cancel my trip?

  If you need to cancel your trip – as long as it's for a reason that is outside of your control – trip cancellation cover will pay for those transport and accommodation services for which you can’t get a refund. Possible reasons your trip might need to be cancelled could include sudden illness or injury, a natural disaster or being called up for jury duty.

• Can I get cover for my camera?

  Yes. If you have expensive items in your luggage or personal belongings that are not covered by the benefit limits, you can take out additional cover by paying an extra premium. Such items might include cameras, jewellery and electronics such as smart phones and laptops.

• Does travel insurance cover cruise travel?

  Yes. Cruises have their own particular risks and if all or part of your holiday includes a cruise, you need to ensure your travel insurance covers cruise travel. Cruise-related losses might include missing your departure due to airline delays, falling ill before your departure or falling ill onboard and having to be treated in the ship's sick bay or airlifted to the nearest hospital.

• Can I get a ski travel insurance policy?

  Yes. Winter sports such as skiing, snowboarding and snowmobiling all carry a higher degree of risk, so many insurers exclude them from their travel insurance and it is up to the individual to take out extra cover for them. And injury from an accident is not the only risk that needs to be covered. This kind of holiday also involves the risk of financial loss from snow closures, lost or damaged equipment and unused prepaid ski passes and lessons.

• Is there travel insurance for sports and sports equipment?

  Yes. If you are playing sport on your trip rather than just sightseeing, you are considered a higher risk by insurers, so you will need to take out sports insurance to cover you in case of injury. Even if it is a golfing trip, there is still the risk of being hit by a wayward golf club or ball or even struck by lightning, so sports insurance is still recommended.

• Can I extend my policy?

  Yes. If you end up staying overseas longer than you expected, some providers do allow you to extend your policy.

• Can I get insurance if I am already overseas?

  If you neglect to take out travel insurance before you leave on your trip, it is still possible to get cover while you are overseas. Most insurers have overseas contacts and you can usually obtain full cover after a short waiting period (normally seven days).