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Travel Insurance Guide: Five Things All Travellers Must Know

Alevin Chan

Alevin Chan

Last updated 12 December, 2022

Travel insurance is a must-have, but purchasing a plan can be intimidating for first-timers. Here are five basic but important things to know when choosing a travel plan.

At the risk of jinxing it, we’re gonna go ahead and say this: Leisure travel is back, woo hoo!

Now, in between tracking down hotel deals, scrambling for cheap flights and converting your points into air miles, there’s one more task you shouldn’t ignore. That is, buying a suitable travel insurance policy as a safety net in case anything goes awry during your trip.

In this Q&A article, we detail five things all travellers must know when buying travel insurance.

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Q1. How early should I purchase travel insurance?

Technically speaking, there’s no limit on how early you can purchase your travel insurance, although most people would only buy a plan once they have confirmed their holiday. This usually means anywhere from a few months to a few days prior.

Having said that, different insurers may have varying limits on how far in advance you can purchase your travel policy; up to 90 days in advance is common. Although, that’s not usually a big deal – you can simply come back later if you’re too early.

On the other hand, it is best not to leave your travel insurance to the last minute, lest you end up making a hasty decision and spending more than you need.

There are many insurance plans available on the market, so you should give yourself sufficient time to compare various options and find the best balance between budget and coverage.

Another reason not to delay buying your travel insurance is that you may need to cancel your trip before departure. If you do not have a travel insurance plan by then, you won't be able to claim any trip cancellation benefits.

Related to this topic: When Is It Too Late to Get Travel Insurance?

Q2. Should I get a single-trip or an annual travel policy?

This will depend on the number of trips you’re taking in a year, how long your trips are, where you are going, and what you will be doing on your trip.

Simply put, an annual trip policy covers you for multiple trips within 12 months, so if you plan on taking more than a few holidays within the year, you may find an annual trip to be more cost-effective compared to buying several single trip policies.

Do note that annual plans may restrict how long each trip will be covered, so this may not work for exceedingly long holidays.

For instance, if you’re planning to stay for six months in Paris, and two months in Japan, but your annual policy only allows up to 90 days of coverage per trip, then the Paris leg of your odyssey will not be covered.

In this case, you will need two separate single-trip policies. Most single-trip plans offer up to 180 days of coverage, but do check before buying.

Next, travel insurance is priced according to geographical region, and tends to go up as you move from Southeast Asia to Asia Pacific to the rest of the world. In particular, travel insurance premiums are especially costly in the USA, due to the country’s exceedingly high healthcare costs.

This is important because when including multiple countries in the same travel policy, your premiums will be charged based on the farthest destination.

For instance, if you’re taking five trips in Southeast Asia, and one trip to Brazil, your entire policy will be priced at the highest tier.

The same principle applies when it comes to activities that require additional coverage, such as golfing or scuba diving. Because add-ons are applied to the entire plan, you may end up paying for benefits that you can’t use during certain trips in an annual plan.

It’s worth noting that single-trip travel insurance doesn't mean “single destination”; you can choose multiple countries under one policy, which means you don’t always have to choose an annual plan if you’re travelling to more than one location.

Related to this topic: Single Trip vs Annual: Which Travel Insurance Should You Get?

Q3. Can I be covered by travel insurance if I’m not vaccinated for COVID-19?

Yes, you can.

In fact, earlier on during the pandemic when vaccines were still in development, many border control authorities required travellers to obtain travel insurance cover specifically for COVID-19. This means that insurers were required to provide coverage to the unvaccinated and most likely still do.

Requiring COVID-19 insurance to enter a country for tourism has now largely been dropped, but it’s still a good idea to ensure you have proper COVID-19 coverage just in case.

Note that having COVID-19 insurance does not exempt you from adhering to the entry requirements of your host country.

If the country you visit requires all travellers to be vaccinated, being unvaccinated will bar you from entry.

Your insurer may then refuse your claims for trip curtailment because you did not adhere to the host country’s travel requirements.

Hence, always make sure that you meet the entry requirement of your host country.

Related to this topic: Is Travel Insurance With COVID-19 Coverage Still Necessary?

Q4. Can I extend my insurance while I’m overseas?

Yes, you can. Travel insurance may be purchased from wherever you are, and you will receive coverage as long as your payment is made and no policy exclusions are triggered.  

Although, technically, it’s not an extension, as you would need to purchase a new policy starting from when your old one ends.

So if you need to prolong the duration of your travel insurance, all you have to do is to purchase a new travel plan online to cover the remainder of your holiday. You can even choose a different insurer or plan if you wish.

Related to this topic: Best Travel Insurance for Travellers with Pre-Existing Conditions (2022)

Q5. Are there any penalties if I were to cancel my travel insurance plan?

No, there aren’t any penalties for cancelling a travel insurance plan, but you may only be able to get back part (or none) of the premiums you paid, depending on the type of travel plan you purchase.

Single trip plans are sold without refunds, as they are issued immediately upon payment. Hence, there’s no point cancelling your policy, as that will only leave you out of pocket and without coverage.

Annual plans may allow a partial refund, but it depends on the duration remaining on the policy. Some insurers may only offer a refund up to 6 months in, while others may offer a prorated refund at several junctures throughout the policy.

That’s not to say you won’t be able to get a refund no matter what, and it is possible your insurer may relent under certain circumstances.

However, you should be aware that travel insurance policies are sold without free look periods (that’s the mandatory 14-day period within which you are free to cancel a life insurance policy and get a refund), and thus insurers are well within their rights not to offer a refund.

All the more reason to carefully compare travel insurance policies before you buy!

Related to this topic: Top 3 Things Travel Insurance Should Cover (And How Much is Enough)

An ex-Financial Planner with a curiosity about what makes people tick, Alevin’s mission is to help readers understand the psychology of money. He’s also on an ongoing quest to optimise happiness and enjoyment in his life.