Irish travellers are forecast to buy more than one million package holidays this year. Most people buy travel insurance from a travel agent when purchasing a holiday. This may be the handiest option, but it may not be the cheapest. It pays to shop around.
An Irish Times survey of nine companies found two weeks' cover for an adult travelling to Europe varied from £19 to £29 (€24.13 to €36.82), while cover for a similar period in the US varied from £35 to £50.
While these were all standard policies, it is difficult to compare like with like, as provisions within policies vary.
For instance, some offer higher limits for medical cover, while others offer better provision in the case of lost baggage.
Travel insurance is on offer from a variety of sources, including banks, credit unions and companies more usually associated with car or home insurance. There may be discounts for existing customers. For instance, the AA offers a 20 per cent discount on its travel insurance products to members or people with an AA home or motor policy.
Increasingly, people are taking two or three short breaks in a year, rather than one long holiday. Mr Stephen Patterson of the Irish Brokers' Association recommends that people in such a situation buy annual insurance. "You can spend 40 per cent more than you need in a year if you don't do this," he says.
Mr Patterson cites the example of a family with two adults and two children who buy an annual premium for £145. If they take one sun holiday and one ski holiday, separate insurance would cost an average of £28 per adult and £14 per child for the sun holiday, and £39 per adult and £19.50 per child for the ski holiday, he says. This comes to £201. The annual policy includes skiing and covers members of the family for individual trips as well as family trips.
Travel insurance packages give varying amounts of cover. Mr Brendan Moran, chief executive of the Irish Travel Agents' Association, advises consumers to read the fine print, especially the details relating to cancellation and curtailment.
Such insurance policies are designed for a specific purpose and, while they will cover valuables up to a certain amount, he says, "it's not designed to cover the family jewels".
In practice, all tour operators insist on insurance, so it is compulsory for people going on package holidays, he says. "However, it is not compulsory to accept the tour operator's product."
The Consumers Association of Ireland (CAI) notes that if you do decide to organise your own insurance rather than buy a tour operator's, the operator may penalise you with an extra fee. "Administration fees can make buying travel insurance elsewhere not worthwhile," says the CAI, which strongly opposes such penalties. The three travel companies included in The Irish Times survey do not levy these fees.
The CAI recommends that travellers compare the level of cover provided in policies as well as the price. For instance, if you're planning a golf holiday, an important consideration is the level of baggage cover a policy provides. "We also recommend that consumers read the policy documents they receive very carefully. Most policies have a `cooling-off period' within which a refund can be obtained if you are not satisfied with the cover the policy provides."
For parents booking family holidays, cover for children is usually half-price. Some companies consider that childhood ends at 16, while others set the threshold at 18.
At the other end of the age spectrum, many policies have an upper age limit. AirTours, for example, has a cut-off of 65. There is a certain amount of flexibility with some companies. For instance, AXA/PMPA quotes an age limit of 75 but, if a customer has a motor or household policy, then that can "go up to 80 fairly freely".
The AA will sell insurance, at the standard rate, for European trips of up to 30 days for those in the 75 to 79 age bracket. Worldwide rates are doubled. People over the age of 79 are usually advised to contact the underwriters, Royal Sun Alliance, and insurance may be arranged subject to full health.
If you're travelling to another EU state you are entitled to emergency medical treatment. To avail of this, travellers should obtain an €111 form from their local health board. This covers emergency medical treatment only and not repatriation, so it is still advisable to take out private insurance when travelling to EU states.
Unfortunately, consumers do sometimes have difficulty recouping their losses, even if they have taken out insurance policies. The insurance ombudsman, who deals with complaints about member companies, received 48 formal complaints in 1999. That figure has risen by about half in 2000.
Ms Caroline Gill, insurance ombudsman, said there was an adjudication in 22 cases in 1999, and 15 came to a settlement before adjudication. Awards of up to £125,000 can be made.
However, Ms Gill cautions that "travel policies are not designed to compensate for loss of enjoyment through illness, curtailment or delay. They are designed to compensate for actual losses that are measurable in money terms. For instance, if your luggage is lost or delayed you may claim for necessary purchases, but only if you have receipts."
If a consumer has a problem with an insurance company, he or she should first try and come to an amicable agreement with the company. If this can't be achieved, he or she must get a signing-off letter from a senior member of the company, advises Ms Gill. Only then is it time to go to the ombudsman.
