Travel Insurance !

Wide bodied jet aircraft brought overseas travel within the financial reach of most Australians and now the cruise ship industry is delivering a more leisurely version of trips to see the world.  When we book that holiday of a lifetime most of us automatically take up the travel insurance offer suggested by our booking agent.   Unfortunately, travel insurance is the most complained about segment of the entire insurance industry.

That is about to change.   The Hayne Royal Commission recommended a shakeup of the insurance industry generally and ASIC is about to gain powers to settle disputes.  Insurance firms have had an exemption from unfair contract laws and this will be the first casualty of this review.

The biggest reason we buy travel insurance is the thought that the onset of serious illness or a catastrophic accident may see us in a coma in a third world hospital served by little more than witch doctors.  It is reassuring to think that our insurer will meet the cost of air ambulance retrieval to Australia, complete with attending doctors and nurses which may run to many hundreds of thousands of dollars.

The problem is that most of us take this insurance for granted and do not read the fine print in the policy they have bought.  If we did, we would find that it is full of exclusions for previous medical conditions which may have little or no bearing on the claim.  There are also onerous restrictions applied to the age of the traveller and those travelling after retirement age usually find the cover applicable is almost void.

Complaints about travel insurance rejections also relate to lost baggage.  It is common for the insurer to claim the baggage was " left unattended " and this can relate to when it is on the carousel at an airport awaiting retrieval by the passenger.  Jewellery loss is also contentious if it is not specifically listed on the insurance cover, and a whole host of activities are excluded, including the unlicensed riding of motor bikes.

What is in the pipeline is the offer of travel insurance to be segregated into three levels of cover with an appropriate price range to cover the risk selected.   This will contain a " minimum cover regime " in basic to which additional cover can be added by upgrading to " intermediate " or " premium ".

This may reduce the incidence of traveller complaints but it is essential that people take the trouble to read and understand what they have bought.  Surveys indicate that forty-three percent of travel insurance customers do no more than skim the policy and have no idea of what is - and what is not - covered.

The small amount of time involved can avoid some very costly mistakes that ruin a perfect holiday.