Do I need travel insurance and what should it cover?

'Do I need travel insurance?' is a question that pops up a lot for holidaymakers. Booking a holiday - be it somewhere hot in February or March - is usually a mix of exciting planning and careful research, and costs can quickly add up, even if you take your time to find the cheapest flights and accommodation. With travel insurance being an extra cost on top of what you’re already paying, you might be tempted to skip it and hope for the best. In fact, according to GoCompare, around 40% of holiday makers plan to go away without travel insurance this summer. 

But with the spate of flight cancellations and delays at numerous airports so far this year, plus all the recent holiday cancellations in the wake of the pandemic, it’s essential to think about ways to protect your holiday plans. This is where travel insurance helps. Without it, you risk being left out of pocket should something like an accident happen. 

Ceri McMillan, travel insurance spokesperson for GoCompare, said: “Travel insurance should be included on everyone’s holiday list – no matter where you’re going. If the worst should happen and you need medical care while away, travel insurance will cover your costs. Without it, your bill could run into thousands of pounds. And it’s not just medical costs, travel insurance also covers for eventualities such as cancellations, disruptions, if your holiday is unexpectedly cut short, and if anything happens to your luggage or personal belongings. Going away without it just doesn’t make sense.” 

Do I need travel insurance?  

While you're not legally required to have travel insurance, you do need it as it covers you for unexpected events that could be potentially expensive if you had to pay yourself. If you don’t have travel insurance - or the right travel insurance - it will be on you to stump up for these costs out of your own pocket.

As well as medical costs, you need travel insurance for:

• cancellation or interruptions to your holiday for reasons out of your control
• missed or delayed departure for reasons out of your control
• injury, medical evacuation and death
• lost, stolen or damaged property in your baggage
• lost or stolen passports
• accidental damage or injury caused by you.

Most policies will cover all this, but always verify if there are any exclusions in your policy.

For example, if you broke your leg in Thailand, it will cost £17,000 in medical costs while treatment for a jellyfish sting in Australia can cost up to £12,000. It’s important to get the right travel insurance too. A British tourist had to pay £35,000 after getting injured in a taxi crash in Thailand when her insurance didn’t cover all the medical expenses. Some medical bills and repatriation costs can even add up to six figures. 

What type of travel insurance should I get?  

The type of travel insurance you should get will depend on your holiday plans and circumstances. Travel insurance comes in two main forms - single trip and multi-trip. Single trip policies cover one holiday, while multi-trip policies cover you for multiple trips over the course of a year. 

Single trip

Single trip travel insurance policies cover one holiday for a set period - it will end when you return home. A single trip policy for an individual could cost as little as £5 while a single trip policy for a family could cost from £13. 

A single trip insurance policy is a good idea if you know you will be taking just one holiday in the next 12 months as it is cheaper than a multi-trip policy. But if you are planning a few holidays within 12 months, taking out individual single-trip insurance policies for each one will not make sense as a multi-trip policy would likely be more cost-effective.

Multi-trip

Multi-trip travel insurance, also known as annual travel insurance, covers you for a number of trips over one year from the date the policy starts. A multi-trip for an individual could cost as little as £27 while multi-trip for a family could cost as little as £52. 

Although you will be covered for several trips throughout the year, there may be limits such as 31-60 day-limit on holidays - so it’s crucial to check the small print to make sure you’re covered if planning a long holiday. 

Like a lot of things, the best way to buy travel insurance is by using a comparison site like GoCompare, MoneySuperMarket or Comparethemarket. But before you buy, check that you don’t already have travel insurance. You may unknowingly have it via your bank or credit card; check to see if you do and what cover it offers. Is it enough? If not, you need to buy a new policy. 

Your travel agent may also offer you travel insurance, but it may not be the best deal for you - it’s worth checking with your bank or credit card provider and using comparison sites first. 

If someone you are travelling with struggles to get travel insurance because of their age (65 or older), try the British Insurance Brokers’ Association to be connected to a specialist insurance broker. 

What happens if I travel without travel insurance?  

If you travel without travel insurance - or the right travel insurance - it will be your responsibility to pay for any costs relating to: 

• Injury, medical care, medical evacuation and death
• Missed, delayed or cancelled departure for reasons out of your control
• lost, stolen or damaged property in your baggage
• lost or stolen passports
• accidental damage or injury caused by you.

You should also buy your travel insurance as soon as you book your holiday - that way you're protected immediately from any unforeseen circumstances even before you start packing your suitcase.

Kalpana Fitzpatrick, Editor of The Money Edit, says: “Don’t leave it until the night before you travel to book travel insurance - when you buy your policy you're protected immediately from any unforeseen circumstances even before you jet off.”

Be aware that travel insurance will not cover you if you are travelling against Foreign Travel Advice. 

What should a good travel insurance policy cover? 

A good travel insurance policy covers your particular needs and circumstances. And although you will want the best price for your travel insurance, it’s important to get the right cover for your particular needs and situation, not just the cheapest. 

This means it should cover where you are going i.e. Europe-only or worldwide including or excluding North America. Verify which countries are included: in some cases Morocco, Tunisia and Egypt are included in insurance for European travel. 

Backpackers need specific travel insurance for their type of travel as it involves travelling to multiple destinations over an extended period of time and doing various activities. Similarly if you’re going on a cruise or a winter sports break, there’s specific travel insurance for this kind of holiday. 

To ensure you will have alternative travel arrangements paid for in the event your airline or accommodation goes bust, your travel insurance should include cover for ‘scheduled airline failure’ and ‘financial failure of accommodation provider’.

If you’re going to the USA, South Africa, Barbados or the UAE, consider getting extra medical cover as treatments there are particularly expensive. If you’re planning any extreme sports or ’dangerous’ activities, get the right level of cover. And if you are taking expensive items with you (like certain gadgets), you may want to increase the cover limits.

GoCompare’s Ceri McMillan says: “As with all types of insurance, it’s important that you look at the levels of cover and make sure a policy is fit for your unique purpose as the levels of cover can vary significantly from policy to policy.”

Do I need travel insurance if I have an GHIC? 

Yes, you need travel insurance even if you have a Global Healthcare Card (GHIC). The GHIC, which replaced the European Healthcare Card (EHIC) after Brexit, is free and entitles you to the same medical treatment as a local in the European country you are travelling to - but it is not a substitute for travel insurance. 

The GHIC doesn’t cover you:

•  outside of Europe 
• - for any costs that may be incurred in bringing you back home
• - for non-medical unforeseen circumstances such as missed, delayed or cancelled departure for reasons out of your control, lost or damaged property in your baggage, lost or stolen passports or accidental damage or injury caused by you

From a medical emergency point of view, be aware that if you have an accident abroad there may not be an NHS-style free-at-the-point-of-use service available. Ceri McMillan from GoCompare explains: “Many countries don’t have a free healthcare service as we do in the UK, so if private healthcare is your only option, the GHIC will not cover this.” 

Am I covered for flight delays and cancellations even if I don’t have travel insurance?

Yes, you are covered for flight delays and cancellations even if you don’t have travel insurance. EU law (specifically EU Regulation 261/2004) protects passengers who have experienced delays of more than three hours or cancellations - as long as they are not caused by an “extraordinary circumstance” such terrorism, natural disasters, adverse weather conditions, airport security issues, and air-traffic control strikes. The protection means you are entitled to compensation.

GoCompare’s travel insurance spokesperson, Ceri McMillan, says: “If you’re travelling with an EU-based airline, or from an airport in the EU, the airline has to help you if your flight is cancelled or delayed beyond a certain amount of time.” 

If it’s outside the EU, the airline doesn’t have the same legal responsibility. This means you will need to check with the airline to see what compensation you are entitled to.

Similarly, when it comes to travelling by sea it is your ferry company that is your first point of contact for compensation. Some ferry companies offer a 25% or 50% refund on your ticket for the part of the trip that was affected depending on the length of the journey you were going to take and the delay you experienced. 

If your ferry was cancelled, then you should be offered an alternative sailing or refund on the ticket price. ABTA can help if your ferry company does not respond to your compensation claim.

While travel insurance will protect you and your family while you are on holiday, it's worthwhile thinking about longer term protection for your family. This could be making sure you have life insurance or a will in place, to give your family peace of mind should the worst happen. Knowing how to write a will and what it should include is key, but it's also crucial to understand what you should never put in a will.