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Concerning number of Australians ditch travel insurance due to rising costs – survey

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Concerning number of Australians ditch travel insurance due to rising costs – survey


Concerning number of Australians ditch travel insurance due to rising costs – survey | Insurance Business Australia















Here are some tips for young and older Australians…

Concerning number of Australians ditch travel insurance due to rising costs – survey

Travel

By Roxanne Libatique

Many Australians have opted out of travel insurance due to the rising costs, according to Compare Travel Insurance’s latest survey.

The survey found that 36% of Australians would not buy travel insurance due to its increased cost, while 26% would only buy the cheapest policy wherever possible. An additional 19% felt they “didn’t need it,” while 12% dismissed it as it “won’t cover their pre-existing illness.”

“Travellers opting out of travel insurance are putting themselves in an extremely vulnerable position. Even if the price of a policy has increased post pandemic, the cost of overseas medical bills or trip cancellations can far outweigh the cost of a policy, particularly in today’s travel climate. It’s important to consider those risks before even contemplating a holiday,” Ball said. “Ambulance costs alone can cost more than $5k. A stay in a US hospital can result in bills amounting to tens or even hundreds of thousands of dollars, which is not the sum most people can begin to contemplate while on holidays. It is vital that all travelers put their health and safety first.”

Insurance for young and older Australians

Young Australian travelers are least likely to take out travel insurance, especially when faced with increased travel costs – with DFAT revealing that one in 10 travelers under 30 rejected the idea of ​​insurance regardless of their destination. Moreover, a concerning number of travelers believe that the government will help them if they experience a medical emergency, which is not the case.

The rising cost of travel insurance has also left older travelers unprotected – with Compare Travel Insurance’s quote comparison on June 27, 2023, revealing that taking a week’s holiday to Bali would cost a 64-year-old $49, but an 85-year-old in perfect health would have to pay over 10 times more for their cover ($505).

“The increase to already high premiums has made travel insurance increasingly unaffordable for older travelers, particularly if they have pre-existing conditions to declare,” Ball said.

Tips for travelers

Compare Travel Insurance says travelers can save money by choosing their cover wisely.

“Compare carefully to ensure you’re covered for any unexpected incidents that may arise and consider where you may be able to scrimp. For example, you may be able to reduce your luggage cover if you are already insured through your home and contents insurance, or through your credit card,” Ball said.

Meanwhile, older travelers should compare policies to get the best deal or seek out a specialist seniors’ insurer.

Related Stories


Egypt travel advice – GOV.UK

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The Foreign, Commonwealth & Development Office (FCDO) provides advice about risks of travel to help British nationals make informed decisions. Find out more about FCDO travel advice.

Areas where FCDO advices against travel

Your travel insurance could be invalidated if you travel against FCDO advice. Consular support is also severely limited where FCDO advises against travel.

Egypt-Libya border

FCDO advises against all travel to within 20km of the Egypt-Libya border, except for the town of El Salloum (where we advise against all but essential travel).

North Sinai

FCDO advises against all travel to the Governorate of North Sinai.

Northern part of South Sinai

FCDO advises against all but essential travel to the northern part of the Governorate of South Sinai, beyond the St Catherine-Nuweibaa road, except for the coastal areas along the west and east of the peninsula.

The eastern part of Ismaili Governorate

FCDO advises against all but essential travel to the Ismailiyah Governorate east of the Suez Canal.

Western Desert

FCDO advises against all but essential travel to the area west of the Nile Valley and Nile Delta regions, except for:

  • Luxor, Qina, Aswan, Abu Simbel and the Valley of the Kings
  • the Governorate of Faiyum
  • the coastal areas between the Nile Delta and Marsa Matruh
  • the Marsa Matruh-Siwa Road
  • the oasis town of Siwa
  • the Giza Governorate north-east of the Bahariya Oasis
  • the road between Giza and Farafra (but we advise against all but essential travel on the road between Bahariya and Siwa)
  • Bahariya Oasis, Farafra, the White Desert and Black Desert

Hala’ib Triangle and Bir Tawil Trapezoid

FCDO advises against all but essential travel to the Hala’ib Triangle and the Bir Tawil Trapezoid.

Conflict in neighboring Israel and the Occupied Palestinian Territories (OPTs)

The Israeli government has declared a state of emergency across the whole country. International borders in Israel and the Occupied Palestinian Territories (OPTs) could close at short notice. As a result, the land border into Israel from Egypt at Taba could close with little notice. Check with local authorities and consult the travel advice for Israel and the Occupied Palestinian Territories before trying to cross the border.

In response to events in Israel and the OPTs, a number of demonstrations have taken place in Egypt and protests have been planned, including after Friday prayers. Demonstrations can take place at short notice, with a heavy security presence in place. You should avoid large gatherings, demonstrations and protests. See Safety and security

Entering Egypt from Gaza

The Rafah border crossing partially opened on 1 November. This is primarily to facilitate the evacuation of seriously wounded Palestinians and some foreign nationals. We understand that the crossing will continue to be open for controlled and time-limited periods to allow specific groups of foreign nationals, including British nationals, to cross. It is for the Egyptian and Israeli authorities to determine who is permitted to cross, and when. The Egyptian Ministry of Foreign Affairs will contact Embassies to let them know when their foreign nationals can cross. Should we receive notification from the Israeli and Egyptian authorities that individuals are permitted to cross, we will notify those people individually.

Movement to the Rafah crossing and beyond is at your own risk. You should only travel if you judge it is safe to do so. Check the Israel and The Occupied Palestinian Territories travel advice.

The Egyptian authorities have said all aid going into Gaza from Egypt must be channeled through the Egyptian Red Crescent:

  • telephone: +20 226 703 979, +20 226 703 983
  • fax: +20 226 703 967

They are unlikely to consider requests for humanitarian access made in Egypt at short notice.

Concern for friends and family

If you are concerned about friends or family, or need consular assistance call:

  • British Embassy Cairo on +20 (0)2 2791 6000
  • +44 1767 667 600 (UK number) if you experience technical difficulties with the above number

Incidents in South Sinai

On 27 October, an Egyptian Armed Forces spokesperson confirmed that an unidentified drone fell near a medical facility in the Egyptian Red Sea resort town of Taba next to the Israeli border, injuring six people. An additional unidentified drone also struck outside the town of Nuweiba, although no casualties have been confirmed. The authorities are conducting ongoing investigations.

Incident in Alexandria

On 8 October 2023, an Egyptian police officer is reported to have shot and killed two Israeli tourists and an Egyptian tour guide in Alexandria. A third tourist was injured. Remain vigilant and exercise caution at tourist and religious sites, as well as public gatherings. Find out more information on current risks on the Safety and security.

Border crossings from Sudan

There are still people trying to cross the border into Egypt at Argeen and Qustul. Our ability to provide consular assistance is very limited.

If you are a British national and have crossed the border without valid documentation, contact the British Embassy in Cairo for consular assistance on + 20 (0)2 2791 6000.

Before you travel

No travel can be guaranteed safe. Read all the advice in this guide as well as support for British nationals abroad which includes:

  • advice on preparing for travel abroad and reducing risks
  • information for women, LGBT+ and disabled travelers

Follow and contact FCDO travel on Twitter, Facebook and Instagram. You can also sign up to get email notifications when this advice is updated.

Travel insurance

If you choose to travel, research your destinations and get appropriate travel insurance. Insurance should cover your itinerary, planned activities and expenses in an emergency.

What Does It Cover and Is It Worth It?

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Terms apply to American Express benefits and offers. Visit americanexpress.com to learn more.

On April 24, 2024, the White House established new rules for airlines, mandating automatic and timely refunds for passengers whose flights had been changed, delayed or canceled.

That’s a big relief to travelers, but there are still many unexpected situations where travel insurance can be a lifesaver before or during your trip.

“Travel insurance is often an overlooked investment until the unforeseen happens,” says Beth Godlin, president of Aon Affinity Travel Practice. “It’s designed to give travelers peace of mind and financial protection against travel risks.”

A policy doesn’t have to be expensive, according to Godlin, to add a layer of protection and security.

How do I get travel insurance?

There are many options in the travel insurance marketplace: Aggregator site Squaremouth lets you get price quotes from different carriers and, because it receives a commission from the insurance companies on its site, users aren’t charged any additional fees.

Allianz has both single-trip and annual plans, with a Cancel For Any Reason (CFAR) policy that reimburses up to 80% of prepaid, non-refundable expenses. That’s more than most similar plans on the market.

In addition to trip cancellation, Allianz’s popular OneTrip Prime plan includes travel interruption, emergency medical care and emergency transportation. Children 17 and under are covered for free when traveling with a parent or grandparent.

AIG’s Travel Guard® plans are great if you need to customize coverage: The mid-range Travel Guard Preferred plan pays out 100% for trip cancellation and 150% for trip interruption, with up to $50,000 in coverage for medical expenses and up to $500,000 for emergency evacuation. There’s even a payout of up to $1,000 if you miss your connection.

Travel Guard® Travel Insurance

If you’re booking a trip with an aggregator site like Expedia, review the details of any travel policy that’s offered. Plans are usually based on the elements of the trip (hotel, flight, rental car, etc.) and can differ every time you book.

What does travel insurance cover?

Travel insurance generally covers your expenses, your belongings and your well-being. When shopping for a policy, look for these benefits:

Trip cancellation

If your trip is canceled for a covered reason, a policy will often reimburse airline tickets, hotel rooms, rental cars, tours, cruises and other prepaid, non-refundable expenses. Covered situations can include illness or injury, the death of a family member or traveling companion, job loss, military deployment and even unplanned jury duty, according to Allianz’s Daniel Durazo.

Cancellations can also be covered if a natural disaster, severe weather or airline strike prevents your carrier from getting you to your destination for at least 24 hours.

CFAR plans provide a lot more flexibility and typically reimburse 50% to 75% of your expenses. But they can bump up the cost by about 40%, said Durazo. Policyholders are also still usually required to cancel no later than 48 hours before their scheduled departure. 

Trip delay 

Should you experience a hiccup in your plans, your policy can provide some relief: Food, lodging and local transportation are usually covered if a delay is due to severe weather, airline maintenance or civil unrest.

“For a traveler to be eligible, they must be delayed for the minimum amount of time listed on their policy,” said Squaremouth spokesperson Megan Moncrief. “Some policies are very lenient and provide benefits for any length delay, while others list a length requirement — usually somewhere between three to 12 hours.”

Daily payout limits range from $150 to $250 per traveler, according to Moncrief, while the total policy limit can be anywhere from $500 to $2,000. Save any receipts to submit with your reimbursement claim.

Don’t miss: The best credit cards with trip delay insurance

Trip interruption

Should you need to cut your trip short due to illness or injury, or if there’s a family emergency back home, your policy may reimburse non-refundable expenses you forfeited.

It may also cover the cost of a one-way economy airline ticket home.

Baggage loss

Airlines are required to compensate passengers for luggage lost in transit, but a travel insurance policy may have a higher benefit limit. It could also cover you if your bags, passport or other possessions are lost, damaged or stolen once you’ve gotten to your destination.,

The Platinum plan from AXA Assistance USA has a $3,000 benefit limit for lost luggage, well beyond the $1,700 that airlines are required to provide on international flights. AXA has offices in more than 50 countries, with multilingual operators available 24 hours a day to help reschedule flights, book hotels and make other arrangements.

AXA Assistance USA Travel Insurance

Travel insurance doesn’t cover every loss: Cash is not reimbursable and many policies won’t reimburse for expensive jewelry or heirloom items. Read your policy carefully to see what is included.

Medical expenses and emergency evacuation

If you travel within the U.S., your health insurance should cover any illness or injury you sustain. If you’re traveling abroad, though, your plan may provide little or no coverage. The right travel insurance should cover doctors’ fees and hospital bills, Durazo said. 

The provider can also help coordinate care and ensure you’re at a medical facility that’s up to U.S. standards.

An emergency medical evacuation can cost anywhere from $15,000 to over $200,000, Durazo added.

New airline regulations in April 2024

The Biden administration announced on April 24, 2024, that it had finalized new rules requiring airlines to issue cash refunds to passengers if their flights were canceled or significantly changed, their checked luggage was significantly delayed or if purchased services, like Wi-Fi, were not provided.

Refunds must be automatic and made via the same form of payment as the original purchase. Travelers must be reimbursed within seven business days if the refund is going to a credit card. (Other forms of payment can take 20 calendar days to be reimbursed.)
 
The new Department of Transportation regulations also require airlines and ticket agents to disclose upfront any fees for changing or canceling your reservation, seat selection, checked bags or carry-ons.

The Biden administration has targeted junk fees across numerous industries, including credit card companies. It said the rule will help consumers avoid unneeded or surprise charges that can quickly add up and obscure the real cost of a seemingly inexpensive ticket.

How much does travel insurance cost?

A travel insurance policy typically costs between 4 and 10% of the overall price of your trip. The cost can vary:

Whichever plan you choose, read the fine print so you understand what you’re paying for.

Is travel insurance worth it?

While regulations on airlines are becoming increasingly stringent about reimbursing travelers for delayed or canceled flights, that doesn’t do you any good if it wasn’t the airline that put a kink in your plans.
Travel insurance covers numerous scenarios, from medical emergencies to tropical storms. It could be particularly useful if:

“When deciding if travel insurance is right for you, ask yourself how much you could stand to lose if you had to cancel at the last minute,” said Godlin.

If you’re not as concerned about risk, your credit card may offer built-in travel protection if you book with that card: Chase Sapphire Preferred®, Southwest Rapid Rewards® Plus Card and the *American Express® Gold Card all come with trip cancellation and interruption coverage, among other benefits.

*Eligibility and benefit level varies by card. Terms, conditions and limitations apply. Please visit americanexpress.com/benefitsguide for more details. Underwritten by New Hampshire Insurance Company, an AIG Company.

Chase Sapphire Reserve®

Southwest Rapid Rewards® Plus Credit Card

American Express® Gold Card

On the American Express secure site

Research your card’s travel benefits before making any purchases related to your trip.

FAQs

Bottom line 

Travel can be a wonderful experience, but it involves a lot of time, planning and money. Missing a single connection can have a cascade effect that impacts your flight, hotel room, dinner reservations and more. A good travel insurance policy can provide peace of mind so you can focus on your vacation.

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Meet our experts

At CNBC Select, we work with experts with specialized knowledge and authority. For this story, we interviewed Beth Godlin, president of Aon, which provides custom travel insurance for tour operators, cruise lines, travel websites and others. We also spoke with former Squaremouth Megan Moncrief and Allianz communications director Daniel Durazo.

Why trust CNBC Select?

At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every insurance article is based on rigorous reporting by our team of expert writers and editors. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.

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Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.