Expect the unexpected and be ready to have the trip of a lifetime.

My Story: The Perils of Peru

I was travelling in Peru for four months and always took the necessary precautions when eating out – I made sure I drank only bottled water and regularly washed my hands. But one day after dinner at a reputable restaurant, I began to feel ill, which led to a night of agonising pain.

Early the next day, I was rushed to hospital, where I found out I’d contracted salmonella. I remained in hospital for a day, and doctors prescribed medication that I was to take for the next two weeks.

At the time, I didn’t have extra money to pay for my medical bills. Thankfully, I could describe the circumstances to my travel-insurance provider over the phone (the call was reverse-charge, so I incurred no expense). In line with the insurance policy that I’d taken out before my trip, my provider took care of the medical bills.

On the mend a week later, I lost my bank card to a cash machine, leaving me with no access to money. I placed yet another call to the insurance company, which arranged not only for me to order me a replacement card, but also for emergency cash to be wired to me, which helped cover my daily necessities.

Many holidaymakers forgo travel insurance, as they often see it as an unnecessary expense; however, if my experiences are anything to go by, it’s a pretty important insurance policy in the life of a traveller.

Why You Need Travel Insurance

Travel insurance is essentially an insurance policy that aims to protect and cover you for expenses you incur as the result of unexpected issues and situations. And it’s not just about getting any old insurance; it’s about choosing the right insurance for your trip.

If you think nothing will happen to me, or I don’t need travel insurance for a simple weekend away or even if I do get sick, the doctors are cheap in Thailand anyway, think again. The unexpected often comes with travel. You take out home and contents insurance for any unforeseen residential mishaps, car insurance in case of breakdown or accident, and private health insurance to take care of hefty medical bills. So why go without travel insurance for your travel?

What Travel Insurance Covers

Travel insurance is about much more than simply paying for doctor’s fees or your lost camera and sunglasses. A standard travel-insurance policy generally covers the following:

• Loss and theft of travel documents and personal luggage.
• Changes in travel plans due to involuntary reasons.
• Expenses resulting from travel delays and missed departures.
• Medical emergencies and hospital expenses.
• Emergency evacuations.
• Personal accident cover and continual recovery assistance.
• Additional costs incurred in transport and accommodation if natural catastrophe. unnecessarily and unavoidably impacts you.

For additional premiums, some insurance policies also cover:

• Car-hire excesses.
• Cancellation of trip due to unforeseen circumstances.
• Hijacking compensation.
• Extreme-sport accident cover (snow and sky sports, for example).
• Mugging, cash taken from you.
• Legal costs incurred due to unforeseen faults caused by you.

What Travel Insurance Does Not Cover

The complaints around and lack of belief in taking out a travel insurance policy are often due to a misunderstanding concerning what is and isn’t covered. As a rule of thumb, insurance policies will cover you for unexpected circumstances and not such scenarios as getting an event date wrong or simply wanting to cancel a trip.

Carefully study the insurance cover or consult with someone who has solid knowledge of the insurance policy.

Choosing a Travel-Insurance Policy

Like any type of insurance, the benefit you get from a travel policy depends on the policy you purchase. Not all insurance policies are the same.

Make sure you select insurance that suits your situation.

For example, if you’re going to ski in Japan, then be sure to get insurance that covers snow sports. If you’re likely to hire a car, then a policy that helps you lower the excess if you have an accident is a good idea.

Check the excess

An excess to an insurance policy is the money you’ll have to pay out of your own pocket before the provider can pay any claim to you. For example, say you lose your expensive camera in the jungles of Sabah and file a claim for $800. Your insurance has an excess of $500, which means that when your claim is approved, you’ll receive only $300 in compensation. You have to pay that first $500 out of your own pocket.

Finally, carefully read the policy wording

Cheap policies are likely to have a high excess amount and laborious claims processes. Make sure you understand what to do when you do need to make a claim and know what documentation you’ll need to gather, such as police reports or hospital discharge papers. Understanding your insurance policy will give you that extra peace of mind when you travel.