Before the pandemic, having the right travel insurance protected you against most accidents and unforeseen circumstances.
And while the question ‘Which insurance should I get?’ still remains very important today, it might not be enough.
Yes, we can rejoice that cases are dropping worldwide, but the virus is still impacting people's lives in several countries – more so than in Australia. For the many governments that have lifted restrictions, there are many others who haven’t, and their policies are changing frequently.
Travel insurance companies have brought back the policies that they discontinued when the travel ban was put in place.
Insurers now offer protection against Covid, but each policy is different and none of them offers total coverage.
These days, you need extra planning and research to avoid, or at least minimise, any impacts from Covid.
To help you with the task, we’ve identified three fundamental questions to ask yourself before hitting the Book now button on a travel website.
Three Crucial Questions You Must Answer
1. When and where can you safely travel?
If you’re reading this, you’re dead set on getting on a flight soon. So I won’t ask you: ‘Can it wait a little longer?’ Things have been tough and we all can’t wait for a holiday!
However, to minimise any risks, you can check if your travel destination is safe by visiting Smartraveller. This Government’s website ranks the most popular destinations based on the risk to the average Australian traveller.
They assign each destination an official advice level of 1, 2, 3, or 4:
- Level 1 - Exercise normal safety precautions
- Level 2 - Exercise high caution
- Level 3 - Reconsider your need to travel
- Level 4 - Do not travel
If you know this already, you might be surprised to learn that most European countries are still at level 2, including the United Kingdom, which has lifted most of their Covid restrictions.
Photo by Jeffrey Czum
Remember that besides the virus, there are several other aspects to consider, such as other health risks, crime, terrorism, kidnapping, etc. The good thing is that Smartraveller covers them all, giving you a clear summary of the country’s situation around safety, health, local laws, travel and local contacts.
The other thing to keep in mind is that some countries might require you to quarantine (or apply other restrictions), even if you’re fully vaccinated, which coud impact your travel plans (and just like that, you’re left with only three days of drinking margaritas on the beach).
2. Which insurance will cover you?
As mentioned earlier, some insurers now offer cover for Covid, but usually those policies only reimburse medical, quarantine and cancellation costs if you test positive to the virus.
However, you won't be covered if you need to cancel your trip due to lockdowns in Australia or in your travel destination.
Starting with the assumption that no insurance out there will cover you for everything that can go south, your goal is to find the one that offers the best protection for your specific circumstances.
The first two things to check when considering travel insurance are:
A. Can you get travel insurance for the destination you want to travel to?
Generally, insurance companies cover levels 1 and 2 destinations. For level 3, it depends – you should check the reason why that country is classified at level 3 and see if it features amongst the exclusions in your Product Disclosure Statement (PDS). And, as you can imagine, most insurers won’t cover you for destinations with advice level 4.
B. Are you comfortable with the advice level for your destination?
Advice levels might change after you’ve booked your trip or while you’re travelling. It’s important to be aware of it as this could affect your coverage.
Some insurances allow you to cancel for safety reasons only if the advice level goes up after you've purchased your policy.
If the advice level hasn’t changed, but you don’t feel safe to leave anymore, you might see your claim for cancellation rejected by most insurers.
As there’s a number of factors to consider when purchasing travel insurance these days, it’s important to go beyond the website or insurer’s leaflet and read the PDS.
There’s a reason Product Disclosure Statements never make the best sellers list… but it pays off to read them before buying insurance.
Photo by cottonbro
And since we know how hard it is to understand what to look for in a policy, we’ve created the table below. Yes, we’re nice like that.
What to Look For in Covid Travel Insurances
The policy covers you for the Smartraveller advice level for the countries you’re travelling to
Many destinations are currently under advice level three – ‘Reconsider your need to travel’ – and not all travel insurers cover it
Your destination requires proof that you’re insured for COVID-19 related medical expenses
For example, Singapore requires minimum coverage of SGD $30,000
You are covered for the full duration of your trip
You need to be ready to be overseas for longer than planned in case your flight gets cancelled
Stopovers on the way to your destination are covered and you are aware if there is a restriction on the amount of time you can be at the stopover location
You should know what happens if you remain stuck for an extended period
You are covered if you or your travelling companion tests positive and:
Make sure to clarify what happens if you have to go into isolation because you’re a close contact of someone who tested positive
The policy overs for cancellation costs if your business partner or a relative back home gets sick with Covid
This might affect your travel plans as you might need to return earlier than planned
Are your expenses covered if:
These conditions might be excluded from your policy
You are protected if you decide to go on a cruise
Some travel insurers do not offer Covid cover for multi-night cruises
The policy covers you for claims caused by government travel bans, border closures, or mandatory quarantine/self-isolation requirements at your destination
Restrictions may apply also to fully-vaccinated travellers
Insurance provider allows flexibility
Things might change and borders could open later than anticipated
CHOICE has put together a list, which includes the international travel insurance policies that cover medical and repatriation costs if you're diagnosed with Covid while overseas.
And remember that even if you can’t get cover for Covid, taking out travel insurance is very important. If you’re not convinced, this article is for you – it’ll also give you some handy tips to enjoy worry-fee travelling.
3. What to do if covid affects your travel plans?
You might take all the precautions in the world and things might still go pear-shaped. It’s not you, it’s life.
Here we show you what you can do if that happens.
A. Before you leave.
Let’s say that because of a government travel ban, you need to change your travel dates or itinerary.
Your insurer may allow you to amend your policy dates or cancel it and issue a credit towards a new cover. Better check with the insurance company to see what they can do in your circumstances.
Remember that all policies have a 14-day cooling-off period. If you cancel your cover within the two weeks period, you can get your money back.
However, some insurers may not give a refund, amend your policy or offer you a credit. That often happens if your PDS doesn’t clearly refer to the circumstances of your claim.
And if you think you haven’t received fair treatment from the insurer, you can refer to AFCA, which is the external ombudsman for the insurance industry.
Photo by nappy
B. While you’re travelling.
If Covid affects your trip after you’ve left and you need to make a claim, your best option is to follow AFCA's recommendations below.
Making an insurance claim:
Contact your travel agent, accommodation, airline or other transport company. Many travel service providers offer penalty-free options for customers to amend or cancel their travel arrangements.
If you booked your travel with a credit card, you should also contact your credit card company.
Contact your insurer to find out what your policy covers, and to make a claim.
If you run into problems during the claim process that you can’t resolve directly with your insurer, you can submit a complaint to AFCA.
How to ‘Covid-Proof’ Your Travel Plans
Let us leave you with a summary of what to keep in mind when planning your trip in this Covid world:
✔ Check the rules for travelling to your destination – including what travel insurance you need
✔ If you can, visit only one country rather than several ones
✔ Read the PDS and if there’s something you don’t understand, ask your insurer
✔ Know when you’re allowed a refund
✔ Book flexible plane tickets
✔ Make sure you can cancel or change your hotel booking
✔ Look for and avoid cancellation fees
✔ Pay by credit card, as it often offers some extra protection and chargeback
✔ While travelling, check Smartraveller frequently to make sure there are no changes to the advice level in your destination.
Feeling more confident now? That was the plan.
Time to pack up and get ready to enjoy those margaritas!
For 15 years, Francesco has approached communication from various angles: client-side advertising manager, agency account director, freelance photographer and content writer. Working for several global and Australian finance brands (Morningstar, CBA, American Express, uno Home Loans, OFX and InvestSmart) he has learnt to understand how people save, spend, invest and feel about their money. Today, Francesco develops online content that addresses the real needs and aspirations of Australians when it comes to personal finance.