Travel insurance might seem like an unnecessary expense, but heading abroad uncovered can take a toll on your finances.
Data from travel association ABTA published in May revealed a quarter of those who holidayed abroad in the previous 12 months went without insurance.
It found travellers aged 25-34 were the worst culprits, with two in five admitting they went on at least one trip uninsured in the past year.
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The main reason people gave for not taking out a policy was that they were willing to take the risk, with 28% of those surveyed giving this response.
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However, the average travel insurance medical claim was worth £1,528 in 2024, according to the Association of British Insurers (ABI), with one case costing a huge £1 million.
In total, ABI members paid out £472 million across more than 500,000 claims in 2024.
So while you might think you’re the type to not find themselves in trouble abroad, taking out a policy will shield you from costly accidents and mishaps.
Fraser Lyall, policy adviser for General Insurance at the ABI, said: “While suncream and passports will certainly be necessary, travel insurance is one other essential that shouldn’t be overlooked.
“Travel insurance can offer you peace of mind, knowing that you’re covered for things like emergency medical care should you fall ill or suffer an injury abroad.”
Why is travel insurance important, what does it cover and when is it most important to take it out though? Here’s everything you need to know.
Why is travel insurance important?
Travel insurance is important as it protects against unexpected costs on a trip or holiday.
Securing travel insurance, often for a small upfront cost, is considered a smart move as you could save thousands of pounds in the event of an emergency.
What does travel insurance cover?
Travel insurance covers issues such as medical expenses, trip cancellations or delays, and lost or stolen baggage. Holidaymakers can add on optional extras, usually at an additional cost, for example gadget protection.
Make sure you check policy exclusions, as different insurance providers will have different rules.
There are some instances where you won't be covered by travel insurance.
For example, natural disasters such as hurricanes, floods or storms are not typically included in travel insurance as standard. However, some providers will offer this type of cover for an extra fee.
Matt Sanders, expert at Go.Compare travel insurance, said: “Generally speaking, travel insurance provides you with a financial safety net if things go wrong on your holiday.
“It covers common risks such as an injury or illness that might mean you have to seek medical help or even cancel your trip, your luggage getting lost in transit, or a medical emergency while you’re away.
“Some policies also include cover for flight delays, missed connections, or unexpected events like natural disasters. But you should always read the details of a policy to see exactly what it covers.”
When do you need travel insurance and is it worth it??
While travel insurance is likely to be a good idea, it may not be essential for every trip. But in certain instances, travel insurance could be well worth it.
Travelling abroad, especially with prepaid trips booked, can come with the risks of unforeseen circumstances. As such, travel insurance protects against cancellations in events out of your control.
For the adventurous at heart, you may need to get specialised cover as your travel insurance policy might not cover certain activities.
Skiing, scuba diving, hiking or bungee jumping carry their own risks, particularly in more remote locations, and this coverage can be of assistance in a worst case scenario of injury.
Sadly, unrest is continuing across the world, so for countries where the political or economic situation is volatile, travel insurance is likely to be worth it in case you have to cancel your plans, or need to leave urgently once you get there.
Many people will be travelling to capture the best moments of their trip with a camera, but this, and valuable possessions like it, should be protected. Those carrying valuable items can benefit from travel insurance as it can cover loss or theft.
Finally, if you are planning to visit multiple destinations on your journey, travel insurance could be a key way of keeping unexpected costs down. Flight delays and cancellations in particular can prove costly, so if you do miss your connection, travel insurance is worth it to recover costs.
How much is travel insurance?
The average cost of a single-trip policy is £25, figures from Go.Compare show. This rises to £67 for those taking out annual multi-trip insurance. Backpackers insurance can be even higher at an average of £177.
The cost of your travel insurance will ultimately depend on a number of factors, including the destination, length of trip and any pre-existing medical conditions.
Is it worth paying excess on travel insurance?
Excess is a fixed amount you will pay towards a travel insurance claim before the insurer covers the rest - and some will be wondering whether this part of travel insurance is worth it.
When taking out travel insurance, there is often a choice to be made. Either you can pay a higher premium for zero excess, or a lower premium with excess fees on claims.
Choosing a travel insurance policy with excess can lower the upfront cost for the policyholder, but can also reduce your payout if you need to make a claim.
Excess can be worthwhile, for example, on low-risk trips with a minimal risk, or where small claims against the policy are unlikely. However, there is one major consideration to bear in mind when thinking about excess.
Sanders, from Go.Compare, said: “Most travel insurance policies will already include an excess, the amount you pay towards any claim. Choosing a higher excess can reduce your premium, but it also means you’ll pay more initially if something goes wrong.
“If you want more comprehensive peace of mind, opting for a lower or zero-excess policy might be worth the slightly higher cost.”
Do I need travel insurance if I have a GHIC or EHIC?
A European Health Insurance Card (EHIC) is the pre-Brexit predecessor to the Global Health Insurance Card (GHIC).
If you have an existing EHIC, you can continue to use it abroad until it expires, after which you need to apply for a GHIC.
A GHIC is free to apply for and lasts up to five years. You can apply for one through the NHS website.
Both cards can be used to cover medical care through state healthcare systems abroad, across most European countries. This includes routine maternity care.
However, they won’t cover the cost of repatriation flights, treatment in private medical facilities or ski or mountain rescues.
Therefore, it’s still worth taking out travel insurance when going abroad to supplement the use of these cards.
Greg Wilson, chief executive officer and travel insurance expert at Quotezone.co.uk, said: “Some insurers may waive any excess on medical treatment if you use an EHIC or GHIC but you need to check the terms of the policy.”
How do I make a claim on my travel insurance?
To make a claim on travel insurance, first review the terms of your policy. You should subsequently gather the required evidence and documentation that may support your claim. Details such as receipts, booking references, proof of cancellation, or police reports in the case of theft or loss could assist.
Many travel insurance providers want their policyholders to contact them as soon as possible following issues or incidents, and this is particularly true in cases of medical emergencies. To help in making a successful claim, make note of your insurance provider's helpline.
Next, complete a claim form with accurate and relevant details. A prompt submission will decrease the likelihood of a claim being rejected.
Processing a travel insurance claim may not be instantaneous, but being proactive is recommended. Some insurers may require more details, so be prepared to provide further information in the case of a follow up.
When is the best time to book travel insurance?
It is worth buying travel insurance as soon as you have booked a trip. The sooner a travel insurance policy is taken out after a trip is booked, the sooner you will be able to have the protection against any issues that may force you to change your plans or cancel your holiday altogether.
Procrastination when it comes to booking travel insurance is generally not a good idea.
This is because if you are purchasing single trip travel insurance, the cover will last from the day the policy is bought to the date you return home
This means if there are any unforeseen circumstances, such as medical emergencies, accidents, a death in the family, or a travel provider going bankrupt, before a trip, they could be covered by your policy.
Greg Wilson, from Quotezone.co.uk, says: “Many travellers choose the date they’re due to set off on holiday as the start date for their travel insurance policy, but that usually isn’t the best plan.
“Buying your travel insurance when you book your holiday ensures you’re covered for any events that might prevent you from going away in the first place.”
An annual, multi-trip policy could be suitable for those who are travelling throughout the year, even if at first glance it may seem expensive.
"This type of policy covers all your trips for the year, including UK getaways, and ensures you're protected from the moment you book,” adds Andy McDonald, underwriting manager at Norton Insurance Brokers.
“It works out to be more cost-effective than buying separate policies, and saves you the hassle of sorting insurance every time you travel.”
