When planning a trip, you hope that everything goes as planned. Unfortunately, though, flights get delayed, luggage becomes lost, people are sick, and hotels get overbooked. Between 2016-2017, the Ministry of Foreign Affairs and Trade (MFAT) reported that the New Zealand Government’s consular services had provided support for a total of 2780 of cases, with 186 of those cases being Kiwis that had died overseas.
While no one wants to think about things going wrong, Stuff reports that over 90% of Kiwis obtain travel insurance when they go overseas. When weighing up whether or not you need travel insurance, you might want to consider these factors:
ACC does not cover you while you’re abroad. The Reciprocal Health Care Agreement only covers you in Australia and the United Kingdom, so you may still end up paying tens of thousands of dollars in medical bills if something goes wrong.
Even a single night in a hospital can be exorbitantly expensive. Will, one of the publishers at finder, offers a real-life example: He broke his ankle while travelling in Peru. Two weeks in hospital, surgery and flights home cost AUD$41,000.
Travel insurance can cover you for more than just medical bills. Cancelled flights as well as lost, damaged or stolen luggage and valuables are frustrating and costly. Why risk losing thousands, when you can get peace of mind for as little as the cost of a few drinks?
You could end up in serious debt. Hefty hospital bills and repatriation could leave you and your family hundreds of thousands of dollars in debt.
Travel insurance is compulsory for some countries. You’re required to have travel insurance to gain entry into some countries, including Cuba, Bulgaria, the Czech Republic, Slovakia, Poland, Ukraine, Latvia, Lithuania and Estonia.
The government can’t help with your bills. Even though the New Zealand government offers consular services in foreign countries, it cannot pay for medical treatment.
Most brands cover your children or grandchildren under 21 for free. Most brands cover your dependent children for free.
Your credit card travel insurance might not be enough. The coverage included with your credit card often has lower cover amounts, higher out-of-pocket excess amounts and excludes certain activities (such as skiing or adventure sports). Domestic travel is also typically not covered.
If your trip goes south, you could be saddled with an enormous bill for medical, legal and other expenses. The New Zealand Government won’t bail you out, which is why comprehensive travel insurance is crucial.
Source: Consumer Guide in conjunction with SafeTravel
What are the four essential travel insurance features?
Here are four key features to review when comparing policies. Don’t leave home without them.
Medical cover provides for emergency evacuation and treatment overseas if you suffer a serious illness or injury.
What am I actually covered for?
Emergency medical, surgical and hospital treatment
Costs of your return to New Zealand if necessary
Costs of extra accommodation, if medically necessary and you are unable to return home
Emergency dental treatment
Daily allowance for a hospital stay
When won’t I be covered?
Treatment that can be undertaken back in New Zealand
Unnecessary hospital costs
Medical losses following a cosmetic procedure
Expenses tendered more than 12 months from the date you first received treatment for the injury
Claims related to pregnancy, unless related to unforeseen complications
Treatment for a condition you were aware of when taking out the cover
Costs for injuries sustained while partaking in sports not covered in the product disclosure statement (PDS)
This provides cover for cancellation fees as well as for prepaid deposits you made for travel and accommodation that you can’t recover if your journey is cancelled or shortened.
What am I actually covered for?
Trip cancellation insurance covers transport tickets, pre-booked accommodation and travel agent fees that are non-recoverable. You are only covered if the reason for the cancellation is outside of your control. You’ll have cover for the following reasons:
You or a member of your family passes away
Your travel operator goes bankrupt
You suffer a serious illness or injury
You are made redundant
You are required to stay in New Zealand following a natural disaster or burglary at your home or business within 48 hours of when you were supposed to leave
When won’t I be covered?
The cancellation is due to a pre-existing condition (either yours or that of a relative) that you were aware of when purchasing the policy
You have business, financial or contractual obligations (excluding being made redundant)
Your tour operator reschedules because there were not enough people for the tour to go ahead
You failed to obtain the necessary passport or visa required for your planned trip
This provides cover for luggage and personal items that are lost, stolen or damaged on your trip. You can purchase additional cover for specific items.
What am I actually covered for?
The repair cost or value of any luggage that is stolen, accidentally damaged or permanently lost. Depreciation is applied for unspecified items
Specified items listed at the time of your insurance application
The items were stolen from concealed storage departments of an unoccupied vehicle
When won’t I be covered?
You fail to report the loss, theft or damage to your insurance brand or appropriate authority within 24 hours
The items were checked in to be held and transported in the cargo hold of a transport carrier
Your items were left unattended when the loss occurred
The items were being sent unaccompanied
Your items were left in the car overnight
Damage is the result of cleaning, repair or alteration
You do not provide appropriate evidence when making a claim, such as receipts, valuation documents and police reports
This cover provides for delays and cancellations that are beyond your control, such as missing your flight home after your train to the airport was cancelled because of a storm. Travel delay cover can help you manage some of the additional expenses that may arise as a result, such as accommodation or other transport. You are only covered for the price of the original fare.
What am I actually covered for?
You miss your flight because you have been involved in a motor vehicle accident
You miss your connecting flight following a natural disaster or extreme weather that occurred after you took out your policy
You suffer a medical condition (non-pre-existing) and are not fit to travel, which must be verified by a medical practitioner
When won’t I be covered?
If your airline is responsible for paying compensation, which may include mechanical delays or the flight being overbooked
You miss your flight due to events that could have been reasonably avoided, for example, if you left your bag at the hotel or were caught in traffic
Here are some mishaps you may find yourself involved in and where you find them in your policy. Some types of cover listed here are included in most basic policies, while others are optional. It’s up to you to make sure your policy offers the necessary cover, and for the amount you need.
If you’re sick or injured
If you get food poisoning, have an asthma attack or sprain your ankle, your claim is treated as an Overseas Medical Expense.
If you need a medivac
If you’re seriously injured or fall ill and are too far from the nearest hospital, the Medical Evacuation cover kicks in. If it happens on a cruise or in a ski field, you need to make sure you have the optional Cruise Pack or Snow Sports pack respectively.
If you need to cancel your trip
If you can’t make the trip or need to cut it short because you become sick or a family member dies, you can recover money already spent under the Cancellation Fees and Lost Deposits section.
If an unexpected event messes with your plans
If you have to change your plans because a natural disaster strikes, your home is destroyed or your documents are lost or stolen, Additional Accommodation and Travel Expenses will pay for you to change your plans or return home.
If your important documents are lost or stolen
Your Travel Documents cover helps to replace your passports and travellers cheques if someone steals them from your hotel room or the airline loses them after sending your luggage elsewhere.
If your luggage doesn’t make it
If the airline decides to send your bags in the opposite direction, the Luggage and Personal Effects section pays for replacement supplies until you get them back. It replaces everything if they’re gone for good.
If you have to return home early
If you have to cut your trip short because a family member dies, you can get the funds to head home through the Family Emergency section of your policy.
If you have an accident in your rental car
If your someone keys your rental vehicle or a thief takes off with it, the Rental Vehicle Insurance Excess cover makes sure your out-of-pocket expenses are affordable.
Your credit cards are lost or stolen
Your Credit Card Fraud and Replacement cover help to replace lost or stolen credit cards. If the thief runs up a massive bill, it covers any fraudulent charges that your bank won’t.
Someone sues you
If you injure someone or damage their property, such as knocking over an antique vase on a museum tour, Personal Liability cover helps you pay any money you legally owe.
If the ship you’re sailing on sinks and takes you with it, the Accidental Death part of your policy gives your loved ones a one-time cash payout.
You suffer a total permanent disability
If you go blind or permanently lose the use of your arms while travelling, Permanent Disability cover gives you a one-time cash payout. If the disability keeps you from going back to work, Loss of Income cover provides you with an additional weekly payout.
You go skiing or snowboarding
If you are skiing, snowboarding or participating in any snow sports, you must add a special Winter Sports Pack if you want coverage for many of the situations described above.
Compare travel insurance quotes in 4 steps
Here’s a checklist for comparing and purchasing travel insurance online.
1. Where are you travelling?
Are there risks specific to that country you should be aware of and is it covered by your insurer? If there has been a travel warning issued against travelling to the country, you may not be able to apply for cover. The SafeTravel advisory page has details of those countries not recommended for travel.
Get cover for every country you are travelling to. You may need to get a worldwide policy if you’re travelling to both Europe and the United States.
Regions covered vary among insurers, so make sure to check what countries your insurer covers before purchasing.
2. Do you need extra cover for your trip?
Do you need extra cover for winter sports or adventure activities that aren’t automatically covered?
Do you need cover for a pre-existing medical condition?
Are you taking valuable items with you that exceed the maximum value of a payout?
Are you a senior traveller? (Age limits and costs vary among insurers.)
Do you plan to pay for flights, accommodation or tours in advance? Consider how much you will need to cover cancellations.
Who are you travelling with? Do you need a family policy, with free child cover or one that also covers your spouse?
Are you travelling with a large group? (You might be able to get a discount.)
Are you not returning home to New Zealand? Most insurers require you to depart from and return to New Zealand to take out cover, although a few insurers provide cover if you plan to stay on elsewhere.
3. How long are you travelling for? Are you a frequent traveller?
If you travel often, an annual policy might be more affordable and convenient. Just be aware of the maximum period of travel permitted for individual trips (usually 30-90 days).
4. Know what to look for when choosing a policy:
Make sure you check out the range of benefits and the maximum payment for each claim.
How much are you be paid if your luggage or valuables are lost, stolen or damaged?
When are you covered, if you have to cancel your flight or accommodation?
How much will you be reimbursed if you suffer a medical emergency?
What excess are you charged when making a claim? Can you remove the excess for a small fee?
What aren’t you covered for? There are some countries, sports and activities that are not covered by travel insurance.
Are any medical conditions you have covered automatically?
Already overseas? Only specific policies cover you if you are already overseas, and there is usually a waiting period of about seven days before cover is activated.
How flexible is your policy? Can you amend or extend cover easily enough? Most single-trip policies only provide cover for up to 12 months. If you wish to extend the period of cover, you usually need to contact the insurer, give your reasons for extending the policy and pay an additional premium.
Really? I could have sworn I was covered for that!
The last thing you need is to be left stranded overseas if your claim is rejected. Know exactly what you are covered for and avoid a nasty surprise at claim time.
Had a few drinks? Jumped on a moped after a few drinks and ended up hitting a ditch in downtown Kuta? Yep, you’re not covered. Insurers do not pay claims that arise if you were under the influence of drugs or alcohol.
Renting a motorcycle or moped? You’re only covered if you have a valid driver’s licence as required by your home country, ie New Zealand; you have a valid driver’s license as required by the country you’re visiting for the class of moped or motorbike you’re riding, and wear a helmet. Also, the moped’s engine needs to be the capacity specified by the insurer, usually under 50cc.
Hang-gliding or jumping out of a plane? Not all activities are automatically covered. Each insurer has a list of high-risk pursuits that it excludes from cover, which are specified in the PDS. Find out what these are and if you need to purchase additional cover.
Lost an expensive item? Policies have limits applied to what can be paid for an item, which may not measure up to what it’s worth. Consider getting specified cover to protect expensive items.
Had to pay more once you returned home? You’re only covered for expenses incurred while on your trip overseas, not once you return home to New Zealand. For example, Will was surprised to discover his policy did not cover physiotherapist and specialist appointments after he returned to Australia.
Ended up in a war zone or a riot? Very few insurers cover claims that are the result of you travelling to a country under a travel advisory issued by MFAT or other warnings issued by the government or mass media. These warnings may include strikes; riots; bad weather; civil unrest; contagious diseases; epidemics; pandemics, or threats of epidemics or pandemics. Claims that arise when you’re in a country under a do-not-travel warning are not covered.
Left your bag in the back of the taxi? Most insurers do not cover theft if you did not take reasonable care to protect your belongings. Insurers do not cover theft of expensive items that have been left unattended.
Final stages of pregnancy? Typically, insurers exclude cover for complications that arise past the 26th week of pregnancy, although the specifics of cover do vary from one insurer to the next. Some insurers only provide cover for up to 23 weeks while others may cover up to 32 weeks. Always check the policy’s PDS before purchasing.
Waited too long before contacting your insurer or making a claim? Most insurers require you to notify them of any event leading to a claim within a specific period, some as quickly as 24 hours after the event. Find out what this period is and the maximum time following your journey that you can lodge a claim (usually about 30 days).
Still unclear on a few things? Here are some answers to questions you might have.
1. Purchasing your policy
It’s time to think about purchasing your travel insurance as soon as you have booked any part of your trip, so that your prepaid costs and deposits are covered in the event of cancellations or if your travel company or airline goes bust. You will still only pay for the period of travel you have taken out cover for.
Yes. There are a number of insurers that will provide cover if you have already left. A waiting period of about seven days will usually apply.
Yes. There are some policies that will provide cover for children under 18 who are travelling without an adult. Cover will generally be the same price as an adult policy.
Yes. There are insurers that offer cover for one-way trips. The journey will usually have to start in New Zealand and restrictions may apply for different age groups.
The price shown is for all travellers provided they fall within the restrictions of the total number of travellers allowed for that policy. When you get a quote that lists all the different travellers’ ages, the quote shown is for everyone and not just one person.
You can add additional cover such as cover for specific sports, high-value items or extensions such as destination wedding travel insurance on the insurer’s website before entering your trip details.
Yes. You should take your policy with you as it provides you with information and emergency telephone numbers that you may need in the event of an emergency that may require you to make a claim. Your travel insurance document can provide the following details:
What evidence you will require for your claim to be approved
Your policy number
What you are actually covered for
Your insurers emergency contact details
2. Choosing the right option
When entering your trip details on the finder.com/nz quote engine, at the top of this page, you can either enter the countries or cities you are visiting or choose the region you are travelling to. Insurers offer policies by region, not by specific countries. The exception is if you are travelling within New Zealand, in which case you choose New Zealand or Domestic as your destination.
Yes. For example, if you choose “Europe” as the region you’re travelling to, you are covered for all European countries, although you may not be covered for countries that are not considered to be within Europe. You still only pay what it would cost if you were travelling to just one country within Europe. If travelling in multiple regions, you may want to choose a worldwide policy.
Some brands offer duo policies, which can be much more affordable and convenient than taking out two separate policies. A duo policy covers you and your travelling partner under a single policy. There is usually a reduced amount of cover provided for each cover feature for each traveller.
You need to ensure that your policy provides cover for every destination that you are visiting as part of your trip. Not all insurers cover cruises, so do your research and find out which insurers offer cruise travel insurance. You may need to select the worldwide region.
If you are taking a cruise in New Zealand waters, you may still want to get a worldwide policy, within the Pacific region, because you aren’t covered for medical events by your private health insurance, or by ACC in some instances, in international waters.
Yes. Some insurers offer cover for up to 18 months, (longer in some cases).
3. Adjusting your policy
Most plans come with a cooling-off period of around 14 days. If you cancel your policy during this time, the premium is refunded.
Yes, but you usually need to apply for an extension a week before your cover ends.
Yes, provided you cancel your existing cover within the cooling-off period. You’ll receive a full refund and can take out a different policy.
4. When you will and won’t be covered
Most insurers change the dates on the policy to account for a new trip. Alternatively, you may be eligible for a payout to cover any prepaid expenses.
It covers the amount of excess the rental company charges up to a specific amount. However, it does not take the place of the insurance provided by the rental company.
Travel insurance does not cover costs associated with you being involved in a car accident or if the vehicle is stolen. This insurance is a separate policy that you take out with the car hire company.
Conditions around travel insurance for working overseas vary between insurers. Typically, you are not covered for injuries sustained if the work is labour-intensive or high-risk. It’s crucial to know exactly how you’re covered if you’re planning to work overseas.
Yes, all family members listed on the annual policy are covered for travel on separate trips by themselves (except if they are dependent children travelling alone).
No. Your insurer won’t cover follow-up treatment for injuries or illnesses sustained overseas after you return home to New Zealand.
Yes, provided you were not aware of the condition and not seeking treatment related to the condition before taking out insurance. You are covered for trip cancellation as a result of the condition.
Travel insurance does cover theft, but there are conditions around when a claim is paid. You must not have left the items unattended, and you must obtain an official police statement within 24 hours of the theft taking place.
Some policies provide cover for terrorism, but most policies exclude claims related to it if you are travelling to a destination that MFAT has issued a warning against travel.
5. Making a claim
You should contact your insurer’s emergency medical assistance service as soon as possible, as this service should be available 24 hours a day. The insurer works with local medical providers and services to ensure you receive the attention required.
Generally, you should claim within 30 days of returning home.
It depends on the nature of the condition. For major procedures where the bill is significant, you should be able to contact your insurer to authorise payment. Where the condition is not as severe, you should pay for treatment and get a receipt. In all cases, you must obtain a medical certificate showing the nature of the condition or illness.
If deemed necessary, your insurer covers the costs to bring you home to New Zealand to receive medical treatment. Either ACC or your private health insurer then covers medical costs.
Usually, the insurer requires that you have some proof of purchase to claim for expensive items. Such proof may include receipts or valuation certificates. It’s worth checking the conditions around what is required before claiming.
It’s really not worth leaving out details of an old medical condition or an activity you might be doing to save a few extra dollars. Insurance companies take the time to ensure your claim is genuine and that you were truthful at the time of application.
Read the important stuff
You might not read ten different product disclosure statements cover to cover, but at the very least read through the exclusions and cover benefits section, so you know what is and isn’t covered. It’s also worth checking out the claims section, so you know what you need to provide and who to contact in the event of a claim.
Know the excess you will be charged
Excess charges can vary significantly between insurers and will generally range between $50 and $250. You are charged an excess for each claim you make under the policy.
Want to avoid the excess altogether?
Specific policies may offer an excess buyout, commonly known as an excess eliminator, which gives you the opportunity of paying a flat fee when you purchase the policy, so you no longer have to pay an excess.
Know what will be paid for the loss of valuable items
Most policies have a sub-limit for individual items, such as $500 per item. If you are taking out additional cover for expensive items, make sure you know the maximum amount your insurer pays for multiple items in the event of a claim.
Keep an eye out for discounts
Competition between insurers for your business means there are some chances to lock down great savings and bonus gifts.
Maurice Thach is a publisher at Finder who covers anything that sounds hard to compare. This includes life insurance policies, side hustle ideas and energy plans. Maurice has a Bachelor of Commerce from the University of New South Wales, a Tier 2 General Insurance certification and a Tier 1 Life Insurance certification. Outside of work, you'll probably find Maurice hitting up the nearest basketball court.
Knowing what you are covered for in a travel insurance policy is only half the story. Knowing when cover is not provided is equally important, and this guide shows why a thorough reading of your policy prior to purchase is highly recommended.
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