Thousands Could Be Overpaying For Their Travel Cover

Thousands of holiday goers could be overpaying on their travel insurance, as mini-breaks become the latest victim of the financial downturn, forcing people into "staycations".

A study by a financial data provider found that instead of heading off to different shores several times this year, many people will be commuting to just one holiday destination in the summer.

Brian Brown, the head of insight at the firm and also author of the report, says: "The number of overseas trips is showing a decline for the first time in two decades, with fewer trips to many of the usual destinations."

This means consumers may be better off with single-trip insurance, rather than paying extra for yearly cover. "For most customers taking just one overseas trip a year will mean that purchasing a single-trip policy makes more sense," Brown explains.


This news provides shocking revelations as the difference in individual policies is striking. A competitive single-trip cover could cost as little as £4.11, compared to annual cover, which begins at around £25.00.

However, the difference in cost is much smaller in the family sector, where a single trip cover policy to America starts at around £35, while yearly worldwide policies can cost as little as £40.00.

Travel cover

Michael Taylor, a money mentor at another financial firm, says it's also an opportunity for anyone with a packaged account to review whether it's worth having, as many holiday-goers will have bought into a deal for the free annual travel insurance.

He commented: "This will make these packaged accounts an even poorer deal. If you are paying £12.50 a month or more for an account like this for the free annual travel insurance, it may have seemed a reasonable offer. Once you can meet your travel insurance needs for as little as £5, the scandalous over-charging becomes more obvious."

In addition, he warns: "Insurance available through these accounts can be very poor. Some don't cover anyone over the age of 49, for example, while others force you to pay the first £2,500 of claims, so however you buy, you need to check the key facts to make sure you are properly covered."

Although the cost for a travel insurance policy is the main issue, Maxine Baker, a travel insurance manager, pointed out that it is worth sticking to certain minimums. These include at least £2 million for medical expenses, £1 million for personal liability and £3,000 for cancellation.

Last minute deals

Consumers who don't want to overpay for their holiday by selecting last minute bookings, have been reminded about the importance of taking out travel cover.

Research from an insurance company revealed that half of all European single-trip travel insurance policies are taken out less than three days before departure.

However, insurers have stated that with last-minute bookings, consumers usually forget to secure financial protection.

Christian Young, from the firm, noted that the problem remains widespread.

He said: "People who leave things to the last minute are inevitably going to have less time to be well organised and insurance tends to be [at the] back of mind until it's too late. They are even turning up at the travel terminal without their passports."