Travel insurance policies – Things to watch out for
It is always a good idea, whenever we travel for leisure or for business, to be covered by travel insurance. Travel insurance is designed to cover possible eventualities happening during the trip like illness, loss of luggage and vehicle breakdown.
Travel insurance is a big market and the differences between products can vary enormously, therefore we always recommend to read closely any travel insurance policy contract in order to be sure of what is covered and what is not. Like any other insurance contract, travel insurance is regulated by law 50/1980, of the 8th October. The law protects the insured and sets the minimum standard that the insurance company will have to offer as well the minimum compensations.
Before choosing a specific insurance policy we should ask several questions:
1) What type of coverage do I need?
Different types of coverage will be required depending on the type of travel and the destination.
Typical services offered are:
- Medical coverage. Depending on the policy it will cover hospitalization, medicines and emergency care. Sometime it can cover as well convalescence hotel expenses, emergency repatriation of the insured and the family as well as travel expenses of a family member from the accident location.
- Luggage theft or loss. Many companies offer emergency shipment of essential medicines or cash advances during the time waiting for replacement credit cards.
- Vehicle breakdown
- Civil responsibility and legal assistance.
- Cancellation insurance. In case the insured is in the impossibility to take the planned trip, tickets and hotels will be compensated in its entirety.
2) Am I already insured?
Often, travel insurance policies are included in other products like car insurances, credit cards (if you used the card to purchase the trip, transport or hotel) and plane tickets. It is therefore good to check first what you already have and in which situation the specific insurance is covers you.
3) What activities are covered?
Travel insurance does not always cover every kind of activity. For example sports with an inherent risk like rafting, scuba diving or paragliding may not be covered by a standard policy and will therefore have to be supplemented by additional insurances. Additionally more benign activities like outdoor camping might not always be covered.
4) Check if the insurance policy excludes claims to the tour operator
Special attention should be given to travel insurance related to the travel agent or the product we are buying. In particular cases, standard travel insurance policies issued by travel agents will exclude claims against the tour operators, making it impossible to sue them in case of accident on holiday. In these cases it is better not to take the specific insurance offered by the travel agent and buy third party insurance coverage.
5) Be aware of the maximum amount covered by the policy.
Depending on the region where we are travelling, costs in case of accident might vary. For travels outside the European Union it is mandatory to estimate the possible expenses during a worst-case scenario, as in many parts of the world medical expenses might prove to be extremely high. The coverage by a standard policy will be most of the time insufficient therefore it is a good idea to get extra insurance. It will be possible to split the costs to the different insurances if necessary.
6) Check the service level offered by the insurance company in the country where we are travelling.
There are cases where the insurance company will be able to pay for our expenses in case of accident directly. Nevertheless most of the time we will have to pay upfront and get a refund from the company when we are back to our home country.
Make sure that you have the telephone number and policy number at hand during the trip. Unless life threatening emergency, in case of problem, you will have to contact the insurance company in order to receive instructions on how to proceed. The company might refuse to refund expenses if these procedures are not followed. Remember to keep any invoices or bills that might justify the expenses related to the insurance claim.
If the travellers are nationals of a country belonging to the European Economic Area (EEC) and they travel within the EEC they can benefit from the European Health Insurance card EHIC (In Spanish Tarjeta Sanitaria Europea TSE). You can request the card free of charge from your national health insurance provider. It will give you right to access medical services where you are travelling at the same conditions as the residents.
Take into account that each country’s healthcare system is different. Services that cost you a fee at home might be free in another country and vice versa. There is a very useful mobile phone application available for iPhone/iOS, Android and Windows Phone that is detailing the different services and the costs that you can be charged in the different countries. You can find the download links at http://ec.europa.eu/social/main.jsp?catId=559
The application is available in all European Union languages.