Travel insurance: Holidaymakers opting for pricier cover

This year is expected to be a busy one for the tourism industry, as Britons look to make up for lost time and go on overseas adventures once more.

However, those looking to travel abroad may find costs have grown, such as for flights, accommodation and insurance.

Travel cover experts say there is already a 22 per cent increase in the price of insurance, with the average policy rising from £23 in January 2019, to £28 per policy.

And experts forecast prices to continue rising, with insurers not only taking medical history and age into consideration., but Covid too.

Elderly, or older travellers are expecting to be hit by rising costs for travel insurance, as premiums crept up on average 22% since the start of the pandemic

Matt Sanders, travel insurance expert at GoCompare, believes the price increases is down to more people being honest when buying a policy, as more Britons declare medical conditions than ever before. 

He also believes that people are choosing higher levels of cover, perhaps after the pandemic scuppered previous plans. 

He said: ‘We have seen a marginal increase in premiums compared to previous years, and part of this increase can be attributed to a rise in people declaring medical conditions when they’re shopping around.

‘This could be a result of the Covid pandemic, where travellers are more aware of their insurance needs, particularly around ensuring they have the appropriate cover in case they become ill abroad. 

‘We have also seen more customers opting for higher levels of cover by selecting 5-star policies.’

This price creep is hitting older Britons more, especially those with underlying health conditions that are risker for insurers.

Matt added that the cost of insurance does go up for those over 75, and that was the case prior to widespread lockdowns.

He said: ‘Sadly, it’s a fact of life that as you age, you are more likely to get ill and you are also more likely to have a pre-existing medical condition, so insurers will need to factor in that risk, resulting in higher costs.’

But it’s important to declare your medical conditions, as your insurance could be invalidated if it becomes an issue if you need to make a claim. 

Matt said: ‘Insurers need to know all the details in case you need any medical help while you are on holiday.  

‘Travel insurance is there for peace of mind so if something does happen and you need to claim, you don’t need to worry about the financial side of things.’

However, for some trips abroad, the costs can be eye-watering.

Recent Which? research unearthed wild price differences for the same level of protection depending on your individual circumstances. 

The research suggested that for an older traveller with pre-existing health conditions taking a two-week trip to the US we were quoted £451 for their travel insurance – more than the cost of a transatlantic flight to New York.

Research suggests travellers are more likely to choose higher insurance premiums to cover cancellations and medical issues

Research suggests travellers are more likely to choose higher insurance premiums to cover cancellations and medical issues

Rory Boland, Editor of Which? Travel, said: ‘Covid has introduced numerous risks, making travel insurance indispensable. It is important to ensure you have the right cover in place from the moment you book your trip. 

‘Holidaymakers face paying over the odds if they remain loyal to their previous insurance provider without shopping around. 

‘A quote from a rival company can act as a bargaining chip with an existing insurer and comparison websites can be a useful tool for gauging market prices.’

Matt also added that it’s important to consider the detail of your potential travel policy, to ensure you aren’t paying for more than you need to.

Essential coverage for travel insurance

Which? recommends a good travel insurance policy should include at least the following conditions:

1. £2m medical expenses in Europe and £5m for worldwide trips

2. £3000 cover for cancellation

3. £1500 in baggage and belongings cover

4. £1m in personal liability

He said: ‘As a general rule, the more you pay, the more cover you get. So you don’t want to pay for too much cover if you don’t need it, but equally, you need to make sure you have the right cover in place should you need to make a claim.’  

Matt is advising consumers to really consider if they need cancellation cover for their holiday, suggesting that it’s in everyone’s best interest should the worst come to pass. 

Cancellation’s are the most common type of claim when it comes to travel insurance, says Matt. 

‘This type of cover provides full or partial reimbursement for the cost of your holiday should it be cancelled or you’re unable to travel for various reasons. 

‘To gain maximum benefit for this type of cover, you should buy travel insurance as soon as you book your travels.’

But he added that one of the most important elements of travel insurance is the medical coverage, suggesting that holidaymakers should be covered up to at least £2million when travelling in Europe, or £5million worldwide.

Matt said: ‘The most expensive claims are medical claims. 

‘So think of this cover as your private medical insurance or NHS while you’re away. 

‘Should the worst happen and you need hospitalisation or even basic medical attention, the bill can run into thousands of pounds very quickly.’ 

More importantly, you should check the travel guidelines for the countries you are planning to visit, to make sure your policy will cover you completely. 

Matt concluded that you should ‘consult the latest FCDO travel guidelines to find out whether it’s safe to travel – if you decide to travel against their advice, it’s very likely that you won’t be covered by your travel insurance at all.’

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