Has your travel insurer taken you for a ride?

Buying travel insurance never used to be a nightmare. Most holidaymakers would run a comparison site search and buy the first affordable policy. 

But now the stakes are higher. Travellers stand to lose thousands of pounds if trips are scuppered by the pandemic. 

Meanwhile, insurers are scrambling to keep up with the Government’s ever-changing advice on foreign travel. 

Data firm Defaqto says it knows of 14 firms offering elements of cover for Covid-19 claims, but the situation is changing almost daily. Here Money Mail tells you all you need to know…

When cancelled meant a pay-out

Before the pandemic, insurers would usually cover cancellation costs if the Foreign Office (FCO) changed its advice to warn against non-essential travel to your destination after you took out a policy. This is no longer the case. 

The only new policy that protects travellers in this instance is limited to Nationwide ­FlexPlus account customers. 

Some insurers are introducing specialist cover to protect individuals if they contract the virus. But events, such as changes to quarantine rules or FCO advice, are excluded. 

Ignoring advice from the FCO

If you decided to travel against FCO advice, your insurance policy would typically be void. But last week Staysure became the first major UK firm to introduce policies to support those who travel to European destinations after FCO advice has changed. 

However, you are only covered for emergency medical treatment and repatriation for non-virus-related claims while abroad. 

There is no point taking out a second policy to cover virus-related claims, as it will be void because you would be travelling against FCO advice. 

Insurer Battleface, which specialises in providing cover for travel to war zones, has also adapted its policies to provide Covid-19 cover. A policy would cost a family of four £137 for two weeks in Croatia, for example.

Catching Covid before the trip

Most Covid-19 policies, including those from Cedar Tree, Coverwise and CoverForYou, will meet cancellation costs if you catch the virus before you travel. 

The window is usually two weeks, and if you are going in a group you can only claim costs incurred by those named on your policy. Proof of a positive test is also required. 

CoverForYou and Cedar Tree are also among those who provide cover if a member of your household catches the virus and you have to cancel, subject to proof. 

Coverwise says it will pay out if a close relative catches Covid-19. 

ABTA, British Airways, Coverwise, Holidaysafe and Insurefor.com will cover  cancellation costs if you are denied boarding because of a high temperature, but with no proof of Covid-19.

What if I’m told to self-isolate?

Unless you can prove you have the virus, it is unlikely you will be covered — for example, if you are told to self-isolate by NHS Test And Trace because you may have come into contact with someone who has tested positive, but have not tested positive yourself. 

Brian Brown, consumer finance expert at Defaqto, says policy wordings on this are vague. He adds that Cedar Tree says it may consider a claim if you have written proof that you have been told to self-isolate. 

Puzzled over quarantine

No insurer will cover cancellation costs if you decide you don’t want to self-isolate for 14 days on your return, as this is deemed as disinclination to travel. 

Note that FCO advice and the Government’s quarantine list are not automatically synced. They will usually change together, but the quarantine list is dictated by how likely travellers are to bring the virus back to the UK, whereas FCO advice is decided by the risk posed to British citizens abroad. 

Help while you’re away

All 14 policies on Defaqto’s list, including one from Saga, will cover you if you catch Covid-19 while on holiday. That includes costs for medical treatment, repatriation, having to extend your stay or losses due to cutting your trip short. 

Travellers who book flights with Virgin can also get cover for up to £500,000 through the airline if they catch the virus abroad. 

If FCO advice changes while you’re away, you will be covered. 

It is unlikely your costs would be covered if you wanted to return home early to avoid quarantine rules in the UK, according to Anna Sant, travel insurance expert at MoneySuperMarket.

Are cruises covered? 

All 14 of the Covid policies listed by Defaqto offer cover for cruise travel. There are no age limits, but it tends to be more expensive the older you are. UK-based cruise companies are not currently operating, so an annual policy will only cover claims within the year. It is possible to get cover for single trips beyond the next 12 months.

Beware these added clauses

Insurers are adding clauses that mean they don’t have to pay if you are legally entitled to a refund from your airline or travel company. This means if your trip is cancelled by your provider and they refuse or delay a refund, your insurer won’t bail you out. 

Mr Brown says insurers are being ‘very cagey about some elements of cover’. 

How much will it all cost?

It will depend on things like where you are travelling, how long you are going for and your age. 

As an example, a couple, both aged 30, would pay £10.88 for a Covid-19 policy with Coverwise for a week in the Greek islands. But beware excess costs. 

Most policies now have cancellation excesses of £50 to £100 per person, meaning you might only get back a third of your money if you have paid £150 up front for a cheap trip. Around 12 per cent of all policies have no cancellation excess, according to Defaqto. 

It’s still worth getting insurance even if you don’t have Covid cover. The average cost of a medical claim is £1,300, according to Compare The Market.