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Travel insurance
Introduction
How to find the best travel insurance for your needs.
In 2010 one of New Zealand's biggest travel insurers paid out a claim for $1 million in medical expenses. This shows how important it is to make sure your travel insurance policy has enough cover – particularly for travel to the US.
We've compared cover and cost for 5 popular travel destinations in 3 interactive databases, and explain what to look for and the traps to avoid.
Common traps
Insurance often contains nasty little surprises in the exclusions. Here are some issues that could trip you up:
- Declare relatives’ illnesses: Although you’re covered for curtailment or cancellation of travel due to the death or illness of a close relative, you need to declare a relative’s illness when you take out a policy. Some insurance policies even exclude cover for the death or illness of someone who lives outside New Zealand.
- Contact your insurer immediately: Even if you are seriously ill or injured, it’s essential to contact your insurer immediately if you need to make a claim while you are abroad.
- Repatriation: If you’re travelling to a country in which advanced health care might not be available in a local hospital, make sure your policy covers repatriation. To get repatriated privately in an air ambulance can cost up to $100,000 – money you’ll have to pay yourself, because the New Zealand Government won’t.
- Vaccinations: We were surprised to learn from the Insurance Council that even if you ignore advice to get vaccinated against diseases such as yellow fever, you’re still covered if you fall ill. However, we strongly recommend that you follow all vaccination guidelines.
- Winter sports: You may think of skiing or snowboarding as pretty regular activities – but insurers don’t. Make sure you’ve told your insurer before you hit the slopes. If you break a leg or worse and your insurer declines the claim you could be hit with expensive medical bills – especially if you’ve chosen to ski or snowboard in the US.
- Hazardous pursuits: Scuba diving, bungee-jumping, hang-gliding, water skiing and motorcycling are often automatically excluded from cover. Again, check with your insurer if you’re planning adventure sports of any kind while on holiday.
- Loss of deposit: Most travel insurers won’t cover you for loss of deposits if your travel agent, airline, car rental or accommodation provider goes bust. However, you may have some protection from the Travel Agents Association New Zealand protection bond.
- Multi-trip traps: Annual multi-trip policies cover you for a year, but each trip within that time is usually limited to trips of 30 to 90 days. So you can’t use annual travel insurance for a long trip or a working holiday.
Bank travel insurance
Banks offer travel insurance, although most of their policies can't be purchased directly online and can be expensive.
They also offer insurance through their gold and platinum credit cards – this is free if you’ve paid for your travel on the card. These policies give excellent cover for medical, baggage loss, cancellations and personal liability – but some of them are lacking in other important areas such as terrorism acts and pre-existing medical conditions.
We’ve looked at gold- and platinum-card insurance in our separate Credit card travel insurance report.