How to avoid sky-high costs for travel insurance
Deciding on a holiday destination? 
Travel insurance is one of those things that pops up as optional when you’re buying an airline ticket online. After you’ve booked your flights, there are a stack of questions about whether you want to pay for your carbon footprint, book a hotel, hire a car, purchase extra leg room and buy entertainment packages, and meals.
I don’t know about you, but travel insurance always seems like just a few dollars compared to what you pay for other types of insurance, such as car and health. So how exactly do travel insurers work out what to charge you?
While the potential of a volcanic eruption in Bali or instability in North-East Asia are factors, mainly travel insurers are looking at the cost of medical treatment where you’re going.
When I was younger and thinner (pre-babies), I went on a trip of a lifetime to the United States with a girlfriend, but after eating a dodgy hot dog in California, I was hotel bed ridden for two days with gastro. To get a doctor to come visit was $US450, which made our standard GP visit of $AUS62 seem like peanuts!
So, which countries are the most expensive?
On the Daily Drive this week we spoke to travel insurance expert Phil Sylvester from Travel Insurance Direct who said, "Obviously, in terms of the countries, we are talking about the USA where medical care costs are astronomical, but also parts of Europe (with the exception of the countries where Australia has a reciprocal healthcare agreement – a de facto Medicare arrangement).
If you’re planning on travelling to remote locations be prepared for higher premiums. Some companies have raised premiums of late because of a recent surge in high-cost helicopter evacuations. It used to be that there were a handful a season, now there are a handful a month," said Sylvester.
The next major factor in calculating your premiums is your age and probably unsurprisingly, the older you get, the more your travel insurance is going to cost.
"Sadly, no matter how much exercise you do as a 55-year-old, statistically you are in a band with a lot of other people who are more likely to have a heart attack," Sylvester said.
Destination and age aren't the only factors that go into determining the cost of your travel insurance and way down on the list at reason number three are: natural disasters and terror attacks.
Check out the DFAT SmartTraveller website – depending on the warning level for that country, you may not be able to get cover anyway.
Click here to see the Fiftyup Club’s latest travel insurance offer.
Click here to listen to the interview with Phil Sylvester on how travel premiums are worked out.
Any information contained in this article is general in nature and does not take account of your individual circumstances, objectives or needs.
