With winter holidays and school holidays coming up, do you have a travel insurance safety net?

For that alone, travel insurance is worth every cent.

What does travel insurance cover? Here are five key parts

Please remember that every traveller and every trip’s needs are unique, so you’ll need to get specific advice before making any of your purchasing decisions (and read the fine print).

But generally, here are the five areas of a travel policy and what it’s designed to do:

1. Medical emergencies and evacuation – this is an important one to note any exclusions, but it’s also an important one because emergency evacuation and overseas hospital costs can easily soar out of control.
2. Trip cancellation – This covers you for costs if you suddenly find you can’t go on your trip for some unforeseen reason such as illness, an accident or a death of a close relative. The most important thing we can tell you about this element of travel insurance is to BOOK YOUR TRAVEL COVER EARLY. This article in Insurance & Risk Professional outlines the detail of WHY, but just note that it doesn’t cost you any more to book your travel insurance when you book your trip, but it could save you a heck of a lot of money. Also again, double check that your plan covers cancellation, and also if it covers non-refundable/prebooked costs if your trip is interrupted after you’ve left home (translation: read the fine print. I know, we sound like a broken record, but it could save you a lot of headache/heartache/money.)
3. Baggage/belongings – As we said, this can be one of the main reasons people think to purchase travel insurance, but it might also be the least important (compared to your health and wellbeing). Most travel insurances expect that you’ll take ‘reasonable’ care to prevent damage or theft of your personal belongings but you need to check your policy wording for limits/exclusions.
4. Personal liability – different from insurance for liability when you’re driving, this liability is to cover if you’re involved in an accident, or accidentally cause damage and you’re held accountable for it (and for legal expenses.)
5. Coming home early/resuming your trip – most travel insurances can end upon your arrival home, so for example if you take out a 12 month policy, and need to return home but then want to resume your trip you need to check (before purchasing the policy, we’d strongly recommend) if you’ll be covered on the same policy. Have a close look at the clauses for the period of cover, and implications of medical evacuation, trip interruption and curtailment for details around what expenses may be covered.

As we’ve mentioned above, those are the key areas, but you need to understand what your cover does and does not include. And you need to understand your risks if you opt not to take travel insurance.

This NIBA articleindicates that a staggering amount of Australians that travel assume that they didn’t need travel insurance because the Australian Government would cover costs in an emergency, or they did have travel insurance but didn’t know what was or wasn’t covered. Many Australians also assume they don’t need travel insurance if they’re traveling domestically, but this risk, too can vary and is well worth a free chat to your insurance broker about your travel plans.

It pays to pay attention

The Australian Travel Insurance Behaviour survey found that only half of all Australians check the Smart Traveller website to find out safety information about their destination prior to travelling (and, absurdly, only 23% of those without travel insurance bothered to check.