Travel Insurance: Don't Ignore the Small Print

Small print can make the difference between buying cover that’s practical, catering to the type of person you are and the style of holiday you’ll be enjoying, and cover that is pointless.

Reading the small print before handing over your cash can save you both money wasted on a worthless policy and also time spent arguing over a claim that proves to be fruitless.

Some lenders will try all kinds of ‘tricks’ to avoid paying out on claims, including stating in the small print that losses must be registered within 24 hours, or that a theft from an ‘unattended motor vehicle’ is not covered.

It’s a sad fact that far too many British travellers – people who are often financially aware in all other circumstances - don’t bother to check their insurance’s terms and conditions.

Hundreds if not thousands of holidaymakers each year are aggrieved after making claims on their travel insurance only to be told that they are not adequately covered.

For example, more than 1,500 complaints were made to the Financial Ombudsman Service regarding travel insurance during the financial year ending April 2005. Most of these complaints were related to disputes concerning pre-existing medical conditions.

These are not covered by a vast percentage of policies, though many people only become aware of this when trying to claim after being hospitalised for, say, an asthma attack or diabetic seizure while on holiday abroad.

If the holidaymakers had read the small print to their policy before signing they would have discovered that such claims are likely to be a waste of time and effort. And then the same people would have sought out one of the few insurance companies that do cover pre-existing medical conditions. (These usually come with high premiums and a large excess.)

The elderly are advised to check terms carefully. More than 90% of policies impose an upper age limit, and research by Help the Aged has found that one in four annual travel policies do not cover the over-65s.

Physically active people and adrenaline junkies can get caught out, too, finding out too late that their policy does not cover ‘extreme’ activities - such as white water rafting, bungee jumping and mountaineering - as part of a standard policy. Or else the policy sets a limit on how often an activity should be carried out in order to be able to make a claim.

Even if you are in good physical condition and stay away from doing anything too risky, you could still be foiled by your travel insurance’s small print, which is likely to declare that your policy becomes void should you suffer injury or loss while under the influence of alcohol, or when riding a moped.

Then there is the danger of not being adequately covered. You would be, for instance, in for a terrible shock if you were forced to pay your own hospital bills in the USA, land of the massive medical invoice.

The price comparison website Moneysupermarket recommends that you check that your policy offers at least £2 million for both medical expenses and personal liability, cancellation cover of £3,000, baggage insurance of £1,500 and cover for loss of cash up to a minimum of £250.

If travelling as a family ensure that your children are adequately covered, and if you received free travel accident insurance from your credit card company, be aware that this is not the same as travel insurance. It will only cover problems encountered in transit.