You know we love travel. We love that there are so many ways to make a trip your own, whether you’re a gung-ho adventure nut or a flop-and-drop aficionado. The same is true for your travel insurance: you have plans to choose from, to suit your travel goals. To find out what impacts premium, we had another chat with Dr Ramin from Allianz Partners.
A travel insurance premium is not some random amount designed to make you fork over your travel savings on something sensible (let’s be real, travel insurance is necessary, but no one calls it a fun purchase!) Here’s a recap of Dr Ramin’s advice.
Travel insurance is based on an assessment of various risk criteria, much like any other kind of insurance. For your car insurance, you let your insurer know where you live, what car you drive, where you park it, etc. Life insurance is all about your habits and health. And travel insurance, you’re sharing a medley of things.
How many circles around the sun
Every insurance, Allianz included, looks at your wrinkles as an indicator of risk. Okay, not your actual smile lines, but as data shows older travellers are potentially more likely to have health problems, travel insurance premiums reflect that.
Similarly, different age groups are more likely to jump into activities that are riskier than others, and this impacts the price of a premium.
What are you going to do
Think because you love kayaking grade four rapids, you can’t get insured? Wrong! Several products cater for adventure seekers. For example, an Allianz Adventure Pack is designed to cover a wide range of adventurous sports and activities that are not included in a standard policy.
Much like you wouldn’t expect your extra shot, coconut milk latte to be the same price as a bog standard cup of instant, the higher-risk activities you want to book overseas are factored into the pack price. Snow bunnies, rejoice! Allianz also has a Snow Pack for those vacays where you’re hitting the slopes.
How long are you travelling for
Research has shown that the longer the trip, the higher the chance for mishaps, sadly. We don’t say that to put you off travel (as if!), but this is why a week-long trip will generally be cheaper than a three-month trip, for example.
Heading overseas on a few adventures? Grab an Allianz multi-trip policy! Covering multiple trips in a 12-month window (to a max duration limit), you can satiate your thirst for frequent travel (T&Cs apply, read the PDS) in a much more effortless (and potentially cheaper) way.
Where are you going
As you might expect, your destination affects your premium. Unfortunately, other countries don’t have Australia’s public health system, and hospital costs can be staggering.
Get this: a hospital bed overseas is 44x more expensive, on average than a travel insurance policy, according to new research! In the United States, an average one-night stay is a staggering $1,279! That’s 45 times the daily price of a policy.
The smartraveller.gov.au website is your friend, as it maintains travel advisories for 178 destinations, assigning an overall advice level to each. This reflects the risks for Aussies and is based on how dangerous the destination might be or other difficulties that travellers may experience. Things like major protests or unrest, natural disasters or even new entry requirements.
To ensure you’re up-to-date before you book any travel, check smartraveller.gov.au and the Allianz website for alerts or advisories for your destination/s. This includes immunisation requirements as well.
What’s your health like
Have you got a bung knee? Or are you taking medication for that weird rash? While there are many pre-existing medical conditions that are covered in a travel insurance policy, if you want to travel with cover for them this sometimes affects the price of your premium.
A key reason for this is the likelihood of an episode while overseas, which requires costly medical attention. Or your condition may require specialist care unavailable at your destination, resulting in an air ambulance trip back to Australia.
When are you going
Did you know that how far in advance you book your insurance sometimes affects your premium? It’s a fine balance to ensure you’re covered in case something goes wrong beforehand (resulting in a cancellation or delay), without breaking the budget. In general, the longer you hold a policy, the more it costs.
However, getting insurance when you book your trip means you may be insured for things like pre-paid travel and accommodation if you’re forced to cancel your trip due to unforeseen illness or injury.
As Dr Ramin said, it’s a fine line, so always, do your research before booking any travel insurance and yes, read the fine print! The Product Disclosure Statement (PDS) gets you across the full policy terms, conditions, limits and exclusions.
Travel Insurance is issued and managed by AWP Australia Pty Ltd ABN 52 097 227 177 AFS Licence No. 245631, trading as Allianz Global Assistance (AGA) as agent of the insurer Allianz Australia Insurance Limited ABN 15 000 122 850 AFS Licence No. 234708 (Allianz). Travel Insurance is underwritten by the insurer Allianz. Conditions, terms, limits and exclusions apply. We do not provide advice based on any consideration of your objectives, financial situation or needs. Before making a decision, please consider the Product Disclosure Statement and Target Market Determination available at www.allianz.com.au. If you purchase this insurance, AGA will receive a commission that is a percentage of the premium. Ask us for more details before we provide you with any services on this product.