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Get the right travel insurance By Emma Lunn
Before you jet off on holiday this year, make sure you've packed a good travel insurance policy. It obviously won't stop things going wrong, but it provides financial compensation for a range of unpredictable events, Travel insurance should provide cover if you're forced to cancel or curtail your trip, need medical treatment or repatriation back to the UK, suffer loss or damage to personal possessions, loss or theft of money, or need legal expenses or personal liability cover if you injure a third party. Medical expenses are much higher in some countries than in the UK and you could find yourself in serious financial difficulties if you're forced to pay them yourself. Although pretty much all travel insurance policies include medical cover, it's a good idea to get a European Health Insurance Card (EHIC) if you are travelling in Europe - this has replaced the old E111 form. The EHIC entitles the holder to free or reduced-cost essential medical treatment in all EU countries. If you are flying on a budget airline, for example, you may want to ensure there is sufficient cover for flight cancellations or disruptions. Or if you are planning a round-the-world trip, consider what will happen if you need to come home half-way through. Also, remember that your definition of a dangerous activity could be different to that of your insurer. Dangerous sports cover varies significantly, and some basic tourist activities such as elephant or camel riding are often not covered. The better policies will include about £1,500 worth of baggage and personal possessions cover. In some cases, you will find that some of your expensive items are insured as part of your home insurance. If not, insure them separately or leave them at home.
How and where to buy You can buy travel insurance from many different sources including brokers, travel agents, banks, building societies and direct from insurers. If you want to compare the offerings of different providers, internet comparison sites compare policies from across the market - and you can also buy online. If you're holidaying on a package deal your agent or operator will probably try to sell you their own travel insurance. Although convenient, this is one of the most expensive options and you're better off shopping around. Also, sales of travel insurance from travel agents are not regulated by the Financial Services Authority, unlike banks and insurers. Travel insurance policies may be purchased for individual trips or as an annual multi-trip policy for all trips taken in the year of insurance. If you go away a couple of times a year an annual policy is usually best. If you're planning to have an extended holiday, check the small print of your policy as many are limited to 30 days a trip - if this is the case, shop around as there are policies that will cover you for longer and 'backpacker' policies that will give you cover for 12 months. If you are a skier, make sure that any annual or multi-trip policy includes winter sports cover. Whatever kind of policy you buy, purchasing it early will ensure you are covered should you need to cancel your holiday. Statistics suggest that Brits wasted an estimated £6.1 billion last summer because they had to cancel holiday plans and did not have travel insurance. The small print Claims for stolen possessions are regularly turned down because holidaymakers have left valuables unattended in apartments and hotel rooms. To ensure you're covered, you generally need to keep them about your person or locked in a safe. When you take out the policy you should also tell your insurer about any pre-existing medical conditions. The insurer will then either include the condition at an extra cost or exclude all claims arising from that condition. If you fail to mention a health problem when you take out the policy, and the condition then causes problems on your trip, your insurer can refuse to pay out. Most policy small print includes a clause that says accidents or incidents that occur due to alcohol consumption will not be covered. So if you fall down the stairs after one tequila too many, don't expect your insurer to cough up. Self-inflicted injuries and sexually transmitted diseases are usually excluded too. Terrorism cover varies from policy to policy, but if the Foreign and Commonwealth Office is advising against travel to a particular country or area, insurers will not cover you if you ignore this advice. Travel advice by country is available from the FCO website, fco.gov.uk. Most people would want to cut their holiday short if a close relative died or became seriously ill, but check your insurer's definition of 'close relative' - aunts, uncles, nieces and nephews are often not included. If you've read all the small print and think your insurer has not paid out when it should have done, you need to put your complaint in writing to the company. It then has eight weeks to tell you how it intends to respond. If you're still not happy, you have six months to take your complaint to the Financial Ombudsman Service. Older people If you're in a poor state of health or elderly, you might find travel insurance difficult to find or too expensive. Premiums shoot up when a traveller reaches 65 or 70 years of age, and some insurers have an upper age limit. If you're above 65, a specialist insurer such as RIAS, Age Concern or Saga might be the best option. How to claim Most policy areas of cover are subject to specified limits and excesses, so you will need to read your policy carefully to check how much you are covered for and what, if any, excess you would need to pay in the event of a claim. If items of baggage are stolen, it's important to report the theft as soon as possible, either to the local police or a travel representative. The insurer will normally require policyholders to have a police incident report number. Some insurers insist you get this within 24 hours of the incident taking place, while others say you have to report it to their claims hotline immediately. Insurers will also generally ask for proof of purchase of any stolen goods, such as a receipt or at least a photograph of the item. For lost or damaged baggage on your journey, a property irregularity report (PIR) should be obtained from the airline or airport. Policies will usually not pay out for any single item worth more than £200. Items worth more than this should be insured separately, ideally on your home contents policy, although you may have to pay extra to take certain items abroad. For medical expenses, small claims - such as for a doctor's prescription - are often reimbursed if you produce a receipt, but if you have a serious accident and end up in hospital for a few days, contact your insurer as soon as possible and they will settle the bill directly.
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