What you miss with budget travel insurance – Which? News

If your travel plans are reasonably modest in scope, you probably won’t be in need of the most comprehensive travel cover around.

And with travel insurers offering a range of policy options – from ‘bronze’ to ‘sapphire’ or ‘platinum’ – you’ve got plenty of choice to tailor your cover more closely to your needs and budget.

However, when considering travel policies that have elbowed their way to the top of a comparison website’s listings, ask why they’re as cheap as they are.

When we analysed 129 travel insurance policies, we focused on the 22 marketed as ‘budget’ options (for example, labelled ‘economy’, ‘bronze’ or ‘essential’) and compared them to the rest, to see where the biggest compromises in cover tend to be. Some are less obvious than others. 

Here, we reveal four areas of insurance where you’re likely to lose out – and explain how to work out what level of cover you’re likely to need.

1. Excesses

An excess is a cash amount you’ll need to pay in a claim before the insurer steps in and picks up the rest. So, for example, if your policy has an excess of £100, and your claiming for a stolen laptop worth £1,000, the insurer will pay out £900.

Generally speaking, the higher the level of cover you buy, the lower the excesses on the policy – with some of the more premium policies not having any excess at all. An excess can appear to be a fairly inoffensive detail on paper, but high excesses will significantly reduce what the insurer will pay out.

We found that the policies marketed as being cheap in our analysis carried by far the highest excesses. For medical claims, the average excess on non-budget policies was £75. Among budget policies, this nearly doubled to £149. 

Meanwhile, with claims for lost or damaged personal possessions, the average excess in a budget policy was £125 – two thirds more than the £75 payable with a non-budget policy.  

When we compared policies on cost, we found a similar pattern. 

2. Delays

If you’re worried about traffic jams, strikes or airport chaos, cover for delays in your journey is a handy travel insurance perk and is fairly standard in policies.

It pays for expenses (such as food) that you might incur while you wait, and in some cases for costs such as unused accommodation that you’ve paid for.

While you’d expect the levels of cover (the amounts an insurer would pay out) to be lower in cheaper policies, we found one in five of the budget policies we looked at removed it altogether.

3. Missed departure cover

As the name suggests, missed departure cover pays to help you get back on track if you miss a leg of your travel due to delays beyond your control.

There can be differences between policies in the maximum they’ll pay and which parts of your journey they’ll cover. Most policies cover outgoing flights, but not all cover connecting and returning flights.

However, while 97% of non-budget policies cover missed departure to some extent, six (27%) of the 22 budget policies didn’t cover it at all.

4. Personal belongings cover

Almost all policies – including all but one of our budget policies – cover lost, damaged or stolen items of baggage.

However, cover limits varied widely, meaning that if you’re relying on your travel insurance for this protection, you should check carefully whether it’s up to the task.

Budget policies held, on average, £1,130 personal belongings cover – about half of the £2,111 available in non-budget policies.

Importantly, these figures represent the total amount of cover. Policies also come with a ‘single item limit’ – which is the maximum you can claim for any individual possession. 

With non-budget policies, the average single item limit was £407. For our budget policies, this was again roughly half – £197.

How to pick your policy

If your holiday costs £1,000, forking out for a policy with £10,000 cancellation cover is probably a waste of money. 

But if you prioritise price alone and buy insurance that’s not up to snuff, your savings won’t count for much should you then need to claim.

Work out how much cover you need

It’s not easy quantifying the costs of everything that could go wrong (we suggest a cautious minimum of £5m emergency medical cover, for example). But in other areas you can straightforwardly establish the cover you’ll need. 

For example, for cancellation cover, add up how much your holiday costs in total – including transport and accommodation and any other prepaid expenses. 

Also do the sums on how much it would cost to replace the items you’re taking with you.

This kind of thinking will help you evaluate the minimum levels of protection you actually require – and whether the cheaper policies do the job.

Also, think more broadly about the cover you’d expect to be able to rely on in a travel policy. Make a list of all these requirements.

• Find out more: the minimum levels of travel cover you should get

Check your existing protection

It’s also worth taking stock of the protection you might already have in place. 

For example, if you have worldwide gadget cover or personal possessions cover through your home insurance, this might reduce how much you’d be relying on your travel cover if your £1,000 phone or tablet went missing.

Check our reviews

We’ve examined policies from 44 providers. Check our ratings and reviews for a sense of which ones stand out from the crowd, and how they compare in key areas. 

While none of the budget policies in providers’ ranges passed our stringent tests to earn our Best Buy accolade – not all of our Best Buys were the most expensive products insurers had to offer. 

Before purchasing your insurance, check your list of cover requirements against the policy wording. 

This is the least fun part of buying insurance, but having a passing familiarity with the policy wording will ensure you don’t end up overestimating the cover you’ve bought.

• Find out more: our Best Buy travel insurance policies

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