Travel insurance: Are you covered?

Last updated 05:00 10/02/2013
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SPOIL SPORTS:There are literally dozens of exclusions in travel policies and many relate to the fun stuff.

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Southern Cross has come out tops in the inaugural national travel insurance awards.

Out of 23 travel insurance brands, it was named the winner for both international travel and trans-Tasman travel.

Canstar, the leading researcher of retail financial information in Australia and New Zealand, assessed the best-value policies for singles, couples and families. It found that for travel across the Ditch, the premium for Southern Cross was about $24 below the average and for international travel, the company's premium was about a third less than the average across all profiles.

"There are also some solid features, including the ability to claim online and wide-ranging cover for cancellations, medical costs and repatriation, as well as generous claim limits on other items," says Canstar general manager New Zealand Derek Bonnar.

New Zealanders took a total of 2.17 million overseas trips in the year to December 2012 with nearly one million of those being to Australia.

"New Zealanders automatically get a Special Category Visa when they arrive in Australia provided they meet certain security, character and health requirements," says Bonnar. "This entitles them to staying and working in Australia indefinitely - provided they behave themselves - as well as free emergency hospital treatment."

But that's no reason to be complacent, says Bonnar.

"Travel insurance is a must-have, even if you are just crossing the Ditch. A family crisis back home, theft or a motor vehicle accident are just a few of the things that could leave you very much out of pocket if you don't have insurance cover."

Bonnar says travel insurance was the financial product most frequently complained about in the cases investigated this year, with many who made a claim finding the amount and scope of cover under the policy was less than they expected.

"Travel insurance policies are long, dry documents with many pages and small print," says Bonnar. "The risk of not reading all the conditions before you sign, though, is that your trip could end up costing you 10 times the original price."

Pre-existing medical conditions are one of the most common reasons for claims to be rejected: "It doesn't even need to be a medical condition that you're at all concerned about - if there are any symptoms or conditions you've sought treatment for in the past, make sure you tell your insurer."

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Other common claims to be rejected are those made in relation to unattended luggage going missing.

"Turning your back on a suitcase for a minute or two while looking for a trolley can see a claim for loss rejected," says Bonnar. "Leaving your towel and phone on the beach when you go for a swim, dropping your wallet in a taxi, putting your handbag on the ground and moving away - these actions can all leave you out of pocket. Some insurers require that lost or stolen items be reported within 24 hours of discovery in order to be covered."

Bonnar says travellers need to realise that no one policy will cover them for every thing that might happen while on holiday.

"It's a case of working out what the likely risks could be [while overseas] and making sure that you choose a policy that will cover them."

**This story has been corrected. An earlier version of the story quoted Canstar as saying Southern Cross' policy included "unlimited'' cover for cancellations, medical costs and repatriation. 

- © Fairfax NZ News

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