Travellers must leave nothing to chance

Crucial to have adequate cover

Simmy Micheli, a sales and marketing manager at Travel Insurance Consultants, shares some insights on what travel insurance is, how it benefits the traveler and what one should do if they find themselves in the position of having purchased a travel package with a company that has since stopped operating.

What is travel insurance and how does it help consumers?

The heartbeat of travel insurance is cover for emergency medical expenses incurred while on an international journey. A travel insurance policy will usually also include cover for cancellation and curtailment, luggage losses, travel delays, travel supplier insolvencies and lump sum compensation for accidental death cover whilst on a journey.

What processes/protections are in place for consumers

who find themselves in a situation where they purchased a travel package and the company stopped operating?

The travel supplier insolvency benefit is not always an automatic inclusion in a basic travel insurance policy and you may need to purchase the top-of-the-range offer to qualify for this benefit. This benefit will cover you for losses incurred in the event of one of the travel suppliers you have used is declared insolvent.

This, however, does not usually extend to the insolvency of the travel agency or tour operator you booked through.

It would usually cover [for example] insolvency of the specific airline, accommodation provider or car rental provider used.

When a traveller experiences the insolvency of an agency or tour operator the traveller would have to connect with the travel suppliers and in the event that the payments have reached the suppliers, could ask for refunds or be able to continue with the journey as planned.

If a consumer purchases an international travel package and that country goes on lockdown or their home country does, what happens to the travel package? Does its validity get extended?

This question cannot be answered in totality because it would depend on the airline they are using. Most airlines understand how suddenly things can change because of worldwide lockdown restrictions and have relaxed fare rules to accommodate postponing trips at no extra cost.