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Cheap Travel Insurance
Protect yourself for less. See how much you could save on travel insurance.
On a tight budget but still want to make sure you’re covered while travelling? Get travel insurance that covers what you want without breaking the bank.
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What should you look for in a budget travel insurance policy?
If you’re looking for a cheap travel insurance you shouldn’t be expecting much in the way of coverage but at the bare minimum you should have cover for:
- Overseas emergency medical expenses. Many entry-level policies are also known as medical-only travel insurance, so you can usually expect a high level of cover for overseas emergency medical and hospital expenses. You’ll also be able to access 24/7 emergency assistance and cover for in-hospital expenses, medical evacuation and repatriation to New Zealand if required.
- Personal liability. If you accidentally cause death or bodily injury to someone else or damage their property, budget travel insurance policies can cover your legal liability.
Some cheap policies only offer these two benefits, but some insurers will also add limited cover for:
- Luggage and personal belongings. This benefit covers the cost of repairing or replacing lost, stolen or damaged luggage and personal items.
- Cancellation costs. If you’re forced to cancel your trip due to unforeseen circumstances beyond your control, for example the death of a close relative, budget travel insurance may cover your cancellation fees and lost deposits.
- Accidental death and permanent disability. Your policy may also pay a lump sum benefit if you become permanently disabled or die as a result of an accident during your trip.
Most insurers offer at least two levels of cover – basic and comprehensive. As the name suggests, basic cover only provides benefits for essential items, including overseas medical expenses and personal liability. As a result, it’s relatively inexpensive.
On the flipside, comprehensive travel insurance not only offers a much wider range of benefits but also higher cover limits – usually for not a whole lot more. In addition to the features of a basic policy, it also covers things like your luggage, travel delay, rental vehicle insurance excess, and the theft of cash and travel documents.
So should I consider upgrading to a higher level of cover?
In the battle to find the cheapest* travel insurance available, sometimes it’s easy to overlook what you’re actually getting for your money. In many cases, you may be surprised to find that you actually get much better value for money by upgrading to a higher level of cover. By spending just a little more on your premium, you may be able to access a much broader range of benefits.
While the comprehensive policy above offers a much wider range of benefits and substantially higher cover limits, it’s only $15.74 more expensive than the basic policy. Spread out across a two-week holiday, that works out to less than $1.50 a day, but will provide a whole lot more peace of mind during your trip.
What should you look for when choosing a cheap policy?
This will depend on your personal preferences and travel needs. Here’s a simple way to decide:
Comparing travel insurance can be confusing business. Make sure you consider the following when searching for affordable cover:
- What’s covered. Check the table of benefits to find out when your policy will cover you. Are there any situations that you need cover for but which aren’t included? For example, will you be covered if you engage in high-risk adventure activities like scuba diving or skydiving?
- Cover limits. Take a look at the maximum amount the insurer will pay for each section of cover. How does this compare to the limits imposed by other insurers? As well as overall cover limits, also check for any sub-limits that may apply to individual benefits. For example, while your insurer may cover up to $10,000 for luggage and personal items, it may only pay a maximum of $500 for any one item. If you’re taking an expensive laptop or camera on your trip, you may need to purchase additional cover.
- What’s not covered. Next, read the list of general exclusions to make sure you’re aware of the situations when no cover is available. This will prevent any nasty surprises come claims time.
- Excess payable. OK, so you’ve found a policy with a very attractive premium, but remember that if you have to claim on your policy you’ll need to pay an excess. Some insurers suck in unwitting customers with cheap premiums but then sting them with a big out-of-pocket excess when they make a claim, so check the excess amount before buying a policy.
- The underwriter. Rather than focusing on the brand that sells travel insurance, check to see who underwrites the policy. Is your insurance backed by a reputable company
- Claims process and customer support. Read the PDS to find out what you need to do to make a claim. Read independent customer reviews to see whether the insurer handles claims efficiently, and check how easy it is to contact the provider if you ever need assistance.
- Full disclosure. If you’re worried about the impact your pre-existing medical condition will have on the cost of cover, it can be tempting to “forget” to mention that condition to the insurer. This is a big mistake – though your premium may be slightly cheaper, any claims that arise due to your condition will be refused and your policy may be cancelled.
- Price. OK, if you’re looking for cheap* travel insurance, this is obviously going to carry plenty of weight in your comparison. But don’t let your love for a bargain prevent you from getting adequate cover. Compare your options using the quote engine on this page, but just make sure that the premium isn’t the only factor you consider when choosing a policy.
What won’t be covered by my policy?
Travel insurance isn’t designed to cover every possible event or incident that could turn your dream holiday into a nightmare, and there are a number of specific situations excluded from cover. You won’t be covered if:
- Your claim arises because you were under the influence of drugs or alcohol
- Your claim is caused by a pre-existing medical condition
- You participate in high-risk adventure activities
- Your claim arises due to your own negligence – for example, if you leave your bag unattended in a public place and it’s stolen
- You break the law
- You travel against medical advice
- You ignore a travel advisory from the Ministry of Foreign Affairs and Trade (MFAT)
Our guide to travel insurance exclusions has a full rundown of the situations when you won’t be covered.
It’s also important to remember that budget travel insurance policies tend to only provide cover for a few key risks, and often have lower benefit limits than standard or comprehensive policies. With this in mind, never assume that something will be automatically covered by your policy – check the PDS to make sure.
What else should I know about low-cost policies?
Go through this checklist before you commit to purchasing a basic plan:
When looking for a bargain on travel insurance, it’s easy to get wowed by the price and sign up without reading through the policy. Here’s our three steps to finding cheap travel insurance:
Below are some further steps to take when comparing different budget travel insurance policies.
- Compare your options. This is the easiest way to find affordable travel insurance that covers everything you need. By comparing quotes and policy features across a range of insurers, you’ll not only be able to find the cheapest travel insurance but, more importantly, the policy that offers the best bang for your buck.
- Only pay for cover you need. If you don’t want comprehensive cover for a broad range of benefits, don’t pay for it. Similarly, if you don’t need additional cover for skiing, golf or adventure activities, don’t add them to your policy.
- Buy online. Many travel insurers provide a premium discount to customers who buy their policies online rather than over the phone or in person.
- Don’t buy from your travel agent or airline. If you opt to buy cover from your airline or travel agent, you could pay as much as three times more for your policy than if you purchase direct from the insurer. This is because travel agents and airlines add their own hefty commissions on top of the cost of the policy.
- Look for promo codes. It’s always worth checking for the latest travel insurance coupon codes and special offers that can reduce the cost of your premium.
- Get a discount. From multi-policy discounts and loyalty discounts to discounted cover for members of certain organisations, you might be surprised just how much a discount can help you save. Keep an eye out for any special deals that could help you save.
- Consider a multi-trip policy. If you’re a frequent traveller, the cost of buying a separate insurance policy for each trip you take quickly adds up. That’s why it could be worth your while investing in annual travel insurance, which provides a high level of cover for all the trips you take during the entire year. If you take two or more trips every 12 months, annual multi-trip cover often works out to be much more affordable.
- Enjoy power in numbers. Travelling overseas with a friend or relative? Instead of buying cover separately, if you team up to buy a joint policy the total cost will usually work out cheaper.
- Vary your excess. By selecting a higher excess amount should you need to make a claim, you can enjoy cheaper travel insurance premiums.
For more details on how to find cheap premiums, check out our guide to how to save on travel insurance.
Tips on choosing discount travel insurance
Just in case you’re after that extra bit of savings, here are a few tips we’ve scraped together to help you out:
- Buy online. Many travel insurers provide a premium discount to customers who buy their policies online rather than over the phone or in person.
- Don’t buy from your travel agent or airline. This could cost you up to three times more. After all, the agent needs that fat commission check!
- Keep your eyes peeled for discount and promo codes. It’s not hard to locate all the best up-to-date coupon codes if you try hard enough.
- Enjoy power in numbers. Travelling overseas with a friend or relative? Instead of buying cover separately, you can team up to buy a joint policy and save money almost every time.
- Look for discounts within your network. Organisations people belong to will often have perks and you may find travel insurance deals floating around in there. See if your company, church, industry group or volunteer organisation has travel insurance partnerships you can take advantage of.
- Consider an annual multi-trip policy. If you’ll be taking two or more trips within a 12-month period, annual multi-trip cover often works out to be much more affordable than separate single-trip policies.
- Vary your excess and/or benefit limits. You can often reduce the price of your cover by increasing the excess or decreasing the benefit limits. Just make sure the reduced terms are worth the money saved.
Can I get comprehensive medical on a discount policy?
One of the chief concerns of people looking for a travel insurance deal is whether the decrease in premiums means a dip in the level of medical cover. While this is true of many cheaper travel insurance policies, it is possible to get unlimited cover for medical and dental with budget travel insurance.
Can you buy a cheap travel insurance policy that covers cruises?
Yes. If you’re heading on a cruise, you’re going to want to make sure that your policy offers cover for cruises. Unfortunately, not all policies cover cruises as standard, which means in many cases you’ll have to add a cruise cover option. Back to top
While cheaper travel insurance is better than no travel insurance at all, you still have to make sure the cover you do get is satisfactory and meets your needs. Policy conditions for what you are and are not covered for can be quite complex so it is important to have an idea of what to look out for. Here are some things to look out for:
- Assuming that cheaper policies will cover trip interruptions. Many policies cover you for when your car breaks down on the way to catch your plane causing you to miss your flight. Cheaper travel insurance policies usually limit this clause to only cover you in the event of a breakdown of public transport.
- Assuming that the policy will cover missed connections. When you inadvertently miss a connecting flight, a cost is involved in buying another ticket and sometimes the need for overnight accommodation. Budget travel insurance does not usually cover you for such losses.
- Assuming that budget travel insurance will cover family emergencies (e.g. the passing of a close family member). The definition of ‘close relatives’ can be different on a budget policy than that of the comprehensive travel insurance cover. An uncle or aunt becoming ill and causing you to have to change plans might not cut it with a cheaper travel insurance policy.
- Thinking of just the upfront cost. The cheaper types of policies usually make you pay an excess before the actual insurance is payable even if the event can be claimed. You will find that although you are still covered for many events, you will have to pay an excess that a more expensive policy may not have included.
- Expecting that pre-existing conditions are covered. The most common exclusion is for pre-existing medical conditions. If your illness or injury can be traced back to a pre-existing condition that was present before you made the claim, you claim will be declined unless it is automatically covered, or you have reported it to your insurer and been approved cover for it.
Picture: Getty Images
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