Top 10 points to ponder when buying travel insurance

Being robbed or injured during a trip overseas is an awful experience only made worse if you didn't buy insurance or have an insurer who refuses to pay out your claim. Consider these 10 points before you head overseas and put your mind at rest.

1) Do I need travel insurance?
Absolutely. You would be mad to travel to Cambodia, Laos or Thailand without it. Medical care in Cambodia and Laos is mediaeval, with expats in both countries typically having medical insurance covering air evacuation to Thailand or Singapore. You do not want to end up in a hospital in these countries requiring serious medical attention. And while care in Thailand is world-class, it's not free. If you require anything more than a few nights in hospital, you could easily be faced with medical bills well into the tens of thousands of dollars.

Medical care aside, travellers are regularly robbed, lose their luggage, miss their flights or need to cut a trip short. Travel insurance can mitigate the pain in all these circumstances. If you die while travelling, filling out forms won't be an issue for you, but it will be for your next of kin. The bureaucracy and costs of repatriation after death are expensive, upsetting and time-consuming. Travel insurance won't bring you back to life but it can help speed up and streamline your resting in peace.

2) Should I just buy it from my travel agent?
Shop around. Travel agents can be persuasive salespeople and they often receive generous commissions on insurance they sell. Just because they say the policy is comprehensive and the best on offer, doesn't mean it is. Do your research, compare policies and read the small print.

3) Small print alarm bells
* Dangerous activities
Many insurers consider motorcycling, diving, parachuting, hot-air ballooning and many other largely safe activities as hugely dangerous pursuits. Falling off your motorbike, breaking your arm and spending a few days in hospital will only be more painful if your insurer tells you the bill is all yours.

* Country exclusions
No point in having travel insurance for your trip to Laos if it doesn't cover Laos.

* Working exclusions
Will you be working during your trip? If so, check that your labour won't void your travel insurance.

* Maximum amount per item
You don't want your $1,500 camera stolen only to find out your insurer has a maximum payout per item of $250.

4) What is excess?
The excess is the amount you have to pay to lodge a travel insurance claim. If the stolen goods part of your policy has an excess of $100 and you have a camera worth $120 stolen, you must pay the first $100. Some travel policies have excesses so high it is hardly ever worth claiming.

5) Making a claim
If you need to make a claim, the insurer may ask for loads of paperwork. Find out before you go exactly what sort of documents they will need for you to make a successful claim. Do they need original receipts? If they do, and you don't have the original receipts, what happens? Ask them. You may also need to file original police statements if claiming for stolen items. If your proposed insurer can't answer your questions, find another one.

6) Claims on the road
Can you lodge your claim while overseas? If you lodge a travel insurance claim overseas where will the refund be sent?

7) Extensions
It's easy to extend a trip, but how easy is it to extend your travel insurance? Find out beforehand.

8) Trip interruptions
If a family member or good friend dies while you're overseas, will your insurer pay for you to return home? If Laos plunges into civil war, will they pay for your evacuation? And if your airline goes broke, will you have to walk home?

9) Is it a flexible plan?
Can you opt into certain clauses but opt out of others? Can you purchase extra coverage for your expensive camera gear or to cover you while indulging in a dangerous passion such as diving or off-road motorcycling?

10) Is it within your budget?
You will always need to balance your wishes with your wallet. Do remember however that your wallet could take a huge hit if you don't fork out a decent amount on insurance at the outset.

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