Half of travel insurance policies don't cover airline difficulties – how to get the best cover

Nearly half of travel insurance policies won’t protect holidaymakers from airlines collapsing, new data reveals.

Around 45 per cent of insurance policies offer absolutely no protection against airline difficulties at all, financial information company Defaqto, has revealed. 

With the collapse of budget airline, Flybmi, last week leaving thousands of passengers stranded abroad, the data suggests many of that number would have been left unprotected by their insurance policy despite potentially believing otherwise.

Holidaymakers without sufficient cover are at risk of being unable to claim refunds if the airline they’ve booked with gets into financial difficulty and leaves them with no transport. 

Help: Make sure you are protected against flight cancellations on your travel insurance

– You will need to have travel insurance as soon as you book your holiday to protect against cancellation of your trip before you go. Many people book their holiday but don’t buy the insurance until much later leaving themselves at risk of losing money in the event of a claim. 

Travel Insurance: If you go on holiday more than once a year, consider buying an Annual Travel policy. Not only is this usually cheaper it also means you will be covered for any additional trips or holidays you decide to take during the year.

– The sum insured for cancellation/curtailment should be enough to cover the entire cost of the holiday per person. For example, if you have £1,500 of cover this should be how much the flights/accommodation/transfers/pre-booked excursions/car hire will cost for each person.

– Medical cover should be a minimum of £1million for trips to Europe, and £2million for anywhere else.

– Baggage cover in travel policies is usually quite restricted and has low limits. If you have higher value items you should consider insuring these under your home insurance ‘personal possessions’ cover.

– Look for a policy which only charges one excess per person in the event of a claim which covers multiple policy sections. 

– Some policies describe a family as ‘the insured person, their spouse/partner and children who normally reside with them’. So if your children live with the other parent and you are taking them on holiday with you they might not be covered under a ‘family’ policy.

– If you’re driving abroad make sure your policy has ‘loss of driving licence’ cover. In all circumstances make sure it has ‘loss of passport’ cover.

Before you travel: Read your travel insurance policy. At the very least, read the Summary of Cover and ‘how to make a claim’ sections.

– Write your name, destination airport and hotel on a piece of paper and put this inside each of your suitcases. If your suitcase goes astray and the airlines need to find out whose luggage it is this can be invaluable.

While you’re abroad: Take a copy of your travel policy with you, and contact details for the insurer’s emergency helpline.

– In the event of a medical issue requiring a visit to a doctor or hospital either you, or someone travelling with you, should contact your insurers as soon as possible. The insurer will want to make sure you are getting appropriate treatment, and will want to control the costs.