My credit card is offering me free cover? Why should I pay for travel insurance?
Carefully read the fine print when you see advertisements offering free travel insurance when you pay for the trip with your credit or charge card. This is not always comprehensive travel insurance that you are being offered. Insurance will usually be provided to the individual cardholder and will cover any immediate family if they were travelling together, if their travel itinerary is identical or, in some cases, if it is very similar. To qualify for the insurance, cardholders need to either purchase the return airfare on their credit card or spend a certain dollar amount while overseas. It is not enough to assume that the cover is deluxe quality and comprehensive because it is attached to a premium card.
Following are some questions that you may care to ask your financial institution about the ‘free’ policy you are considering.
- What is the excess on the policy and how is it applied, per event or total? (some free policies require each person covered by the policy to pay a $200 excess per event)
- Will it cover the pre-existing medical conditions of you or your travelling partner? (most free policies severely restrict the coverage of pre-existing conditions including common conditions such as asthma)
- Will it cover the known medical conditions of relatives who may not be travelling?
- Does it cover the excess on hire cars and if so, how much?
- Do they offer 24 hour worldwide emergency assistance that offers assistance from advice on claims to arranging repatriations?
- Can you extend your policy if you choose to stay away longer once travel has started?
- Are your frequent flyer points covered?
- Will it cover the replacement costs of my credit card if it is stolen?
- Who will help put your travel plans back in place following a disruption to the trip if your travel agent does not issue your policy?
- Who will help in the preparation of a cancellation claim or assist in reconciling a disputed claim?
- Do major medical bills have to be approved by the insurer?
- What activities or sports are excluded?
- What is the maximum period for any one trip?
- What is the maximum jewellery or sporting equipment is covered for?
- Does it cover meals and accommodation costs if the bus, train, ferry or plane is delayed or cancelled
Alternatively, Contact us for a travel insurance quote and prepare yourself for a stress free holiday!