Little known insurance clause catching out Aussie travellers

Rear view of a woman at the airport holding a passport with a boarding pass as she walks to her departure gate

One good thing to come from the global pandemic is that most insurers have broadened their coverage to include disease outbreaks and pandemics.

However, a little-known clause could affect Aussie travellers impacted by Covid.

Implemented by several well-known insurers, the clause specifically impacts travellers claiming for cancellation due to Covid.

According to Natalie Ball, director of Comparetravelinsurance.com.au, there is a caveat that some brands have applied to policies purchased within 21 days of your departure date.

In this instance, travellers may only be able to recover costs incurred after your policy purchase date.

“If you purchased your policy ahead of time or prior to the 21-day period, you would be eligible to claim on all your prepaid and non-refundable travel expenses, regardless of when they were made,” Ball said.

“Buying cover too late is where travellers are getting stung.”

Apparently, the key to avoiding getting caught out is to buy travel insurance as soon as you’ve booked your trip.

“The way this clause works is to deter you from buying travel insurance too late. So, say for example, if you pay for your Christmas holiday flights in October, but only buy travel insurance in December, you wouldn’t be able to claim back those flight costs should Covid force you to cancel,” Ball continued.

On the flip side, any bookings made after buying travel insurance would be claimable.

“Following this example, if you were to pay for your accommodation after purchasing travel insurance, you would be eligible to claim back those costs. So be mindful that if you book your holiday ahead of time, it really does pay to buy travel insurance early.”

A common misnomer is that the earlier you buy travel insurance, the more expensive it is, but according to Ball, this is not necessarily the case.

“Buying travel insurance ahead of time may cost you a bit extra in the short term but it can save you a great deal more in the long run,” she said.

“Buying travel insurance in advance allows you to maximise your coverage as benefits activate at the purchase date, not your date of departure.

“A basic policy starts at about $10-$20 per day. When you compare that to the thousands of dollars spent on a typical overseas trip, travel insurance is a no-brainer.”

Lastly, Ball noted that insurers usually offer COVID cancellation cover as an add-on extra, which is worth considering in certain instances.

“With rising airfares and travel costs, that cover may be an expense worth taking if your prepaid costs are in the thousands.”

Image: iStock/Pyrosky

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Email the Travel Weekly team at traveldesk@travelweekly.com.au

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