Why penny pinching on travel cover can cost you thousands
For the sake of just THREE POUNDS you could gain millions more in vital benefits
choosing the cheapest quote for travel insurance could deny you millions of pounds of vital cover that would actually cost you only £3 more.
insurers are so desperate to beat their rivals by a few pennies so they appear at the top of comparison websites that they now offer cover for as little as £4.59 for a single trip.
But the protection can be so basic that it will not pay out if you have to abandon your holiday, your flight or baggage is delayed, or you are permanently disabled or die while abroad.
Exclusive Money Mail analysis found that by spending an extra £3 with the same insurer, holidaymakers could benefit from as much as £5 million additional medical cover and £30,000 more compensation for problems with flights and baggage.
Experts are warning travellers to check the small print carefully before opting for the cheapest deal. They should also scrutinise any cover included with packaged bank accounts, because it may not always be as comprehensive as they think.
This month is one of the most popular times for booking holidays, as people look to ease the January blues — and researching travel insurance at the same time could better protect you.
Using comparison site gocompare, a couple in their 50s travelling to France for one week in February could get travel insurance for as little as £9. in fact, a total of 12 policies were available for less than £12.
however, the medical cover offered varied wildly between these policies, ranging from £5 million to £20 million, while baggage protection swung between £750 and £1,250. The excess — the part of the claim you have to pay before your insurer will step in — varied between £95 and £200.
several policies were also missing protection many people would expect to be standard.
Zurich’s cheapest cover, at £9.38, for example, does not pay personal accident compensation in the event of death or permanent disablement, nor does it cover baggage delays, missed departures or connections, travel delays or travel abandonment.
The policy does not include a hospital benefit daily allowance, which helps pay for food, taxis and phone calls should you or a loved one be hospitalised.
Yet, for just £5.07 more, at £14.45, Zurich’s enhanced policy would cover all of these eventualities, including £10,000 for personal accident cover and £3,000 for travel abandonment.
The cheapest policy available is with Admiral, at just £9.35, and includes £10 million medical expenses, according to research by Defaqto. But, if you pay an extra £4.68, you receive double the cover at £20 million.
This so-called ‘Platinum’ cover, at £14.03, also pays out up to £5,000 if you have to cancel your holiday, compared to £1,000 with the basic policy.
Baggage cover also jumps from £1,000 to £2,500, while the amount you could claim for a single item doubles to £400.
James Daley, of consumer group Fairer Finance, says: ‘Price competition in the travel insurance market has meant that many policies only cost a few pounds. But to stay competitive, insurers are often shedding essential benefits, meaning that many policies are barely worth the paper they’re written on.’
however, there are ways holidaymakers can gauge whether they are getting a decent level of cover. Defaqto has created starrating to help customers decide how comprehensive an insurance policy is. This rating is displayed by comparison sites such as gocompare.com and compareTheMarket.com.
Fairer Finance has also created travel insurance ratings. To get five stars, you need to have an adequate level of cover across more than 25 different benefits.
Virgin Money’s standard cover for a couple travelling to France for a week costs £13.99, which is £1.79 more than its basic policy — but comes with more than £30,000 worth of extra protection. This receives four stars from Defaqto, while its cheaper cover got three stars.
Both provide £15million medical expenses, but its £12.20 deal fails to include compensation if you were permanently disabled in an accident. This compares to £10,000 of cover with the standard policy. Brian Brown, head of insight at Defaqto, says: ‘While you can buy travel cover very cheaply, they have only the most basic cover and exclude things many people might take for granted. For just a few pounds more you can get far better cover, often from the same insurers.’ For example, Flexicover provides a much higher level of protection for just £2.42 more than its cheapest policy. its economy cover, at £12.72, includes £750 of lost or stolen baggage cover, compared to £1,500 if you pay the extra.
For individuals, rather than couples, travel insurance can cost less than a fiver.
A single person travelling to France for one week, for example, could get insurance for just £4.59 with Travelinsurance. co.uk, Money Mail found.
This is followed by cedar Tree at £5 and Zurich at £5.28.
Matthew sanders, of gocompare, says: ‘With travel insurance you tend to get what you pay for, so spending a few extra pounds can make a difference. Always read policy documents carefully to familiarise yourself with any exclusions and conditions.’
BASIC COVER WAS NOT GOOD ENOUGH
RETiRED receptionist christine Mccarthy had to cancel a holiday to cape Verde after being diagnosed with heart failure.
she made a claim with her insurer, staysure, for the £3,800 holiday costs, but she received just £415. They said it was because she had paid for ‘basic’ cover, despite forking out £300 for the insurance for her twoweek break in 2017.
The 75-year-old from new Malden, south-West London, used staysure because it specialises in policies for people with underlying medical issues and she had an irregular heart rhythm.
christine appealed to staysure, and the policy’s underwriters, EVM, for more compensation, but to no avail. she says: ‘i want to make people aware of the pitfalls with travel insurance. i would warn others to always shop around and carefully read the small print.’
A spokeswoman for staysure says: ‘The customer was offered both a basic and comprehensive level of cover, and decided to purchase our basic policy for her trip. This was an insurance policy with a maximum cover of £500 (minus excess), which she was made aware of when taking out the policy.’