Many Australians understand the importance of travel insurance to avoid costly issues when things go wrong on holiday. However, some key elements ensure you’re adequately covered and your claim will be paid should the worst happen.
To help you make the most of your travel insurance and avoid any pitfalls, Southern Cross Travel Insurance (SCTI) has identified the most common mistakes customers make when purchasing travel insurance. Understanding these factors will help you avoid unpleasant surprises and ensure full coverage in various scenarios.
Jo McCauley CEO of STI says, “At SCTI, we strive to pay claims wherever possible. Between January and September this year, we’ve paid over $7.5 million in claims from Australian customers, however, it’s crucial to be aware of the details to avoid common mistakes that can lead to denied claims or inadequate coverage.”
1. Alcohol Consumption: Know Your Limits Travel insurance policies often exclude coverage for incidents involving alcohol consumption. If alcohol contributes to an event resulting in a claim, such as a fall or lost phone, the claim may not be payable. Insurers consider supporting information, including medical reports and witness statements, to understand the impact of alcohol. Always read the fine print of your policy to understand how alcohol consumption can affect your coverage.
2. Personal Possessions: Secure Your Belongings Leaving your possessions unattended in public places can lead to claim rejection. Travel insurance requires you to take ‘reasonable care’ of your belongings. Secure your valuables to avoid theft and potential claim issues. From January to September 2024, SCTI paid out 746 claims to Australian travellers for lost possessions, including 230 for lost mobile phones.
3. Moped and Scooter Travel: Ensure Proper Coverage Riding a moped or scooter can be risky if not covered by your travel insurance policy. Ensure you have appropriate coverage before renting a moped to avoid uncovered accidents or injuries. Claims are typically covered if policy conditions are met, such as having the appropriate licence and wearing a helmet. SCTI has seen an average claim cost of $8,101 for moped and scooter incidents, with the highest claim at $83,748.
4. Skiing and Snowboarding: Stick to the Trails Ensure you’ve selected the appropriate policy add-ons for skiing and snowboarding. Certain activities, like venturing off-piste, may not be covered. SCTI has paid out 91 claims for incidents on the slopes, with an average claim cost of $1,866 and the highest at $28,584 for a skiing accident.
5. Pre-Existing Conditions: Disclose and Confirm Failing to disclose pre-existing medical conditions (PECs) can result in denied claims. Inform your insurer about health issues before purchasing your policy. Some insurers offer coverage for PECs at an additional cost. Common PECs declared by SCTI customers include high blood pressure, asthma, anxiety, hypertension, diabetes type 2, and depression.
6. Travelling with Equipment: Protect Your Gear Ensure your travel insurance covers high-value items like camera equipment and instruments. Standard policies may have limitations, so check and add extra coverage if necessary. SCTI has approved 588 claims for lost and damaged electronic equipment, with an average claim cost of $536 and the highest at $3,000.
7. Medical Emergencies: Understand Your Coverage Ensure your policy includes comprehensive medical coverage, including emergency medical evacuation and repatriation. SCTI’s Emergency Assistance team is available 24/7. The average cost of SCTI Emergency Assistance claims reached $12,459, with the highest at $359,105.
8. Trip Cancellations and Interruptions: Know the Terms Understand the circumstances under which your insurance covers trip cancellations and interruptions. Check if your policy covers non-refundable expenses and penalties for changing travel plans. SCTI has paid out 974 cancellation claims for international trips, with an average cost of $1,613.
9. Rental Car Excess: Check Your Policy Check if your travel insurance covers rental car excess. Ensure you have the necessary documents, such as an international driving permit (IDP) and a valid Australian licence. Requirements vary by country and rental company, so always check before renting a car.
10. Adventure and Extreme Sports: Confirm Coverage Ensure your insurance covers adventure sports like bungee jumping or white water rafting. Generally, you’ll only be covered if you use a licensed operator and follow safety instructions. Specialist insurance may be needed for extreme sports.
“Our goal is to provide travellers with peace of mind, knowing they are protected in a wide range of situations,” adds McCauley. “By understanding these common mistakes, travellers can make informed decisions and enjoy their trips without unnecessary worry.”
