Credit Card Travel Insurance – does it go the distance?

Travel often involves the pleasures of new experience. Exploring new cities and countries as well as cultures is one of the main reasons many of us travel. But unfamiliarity can be a foe as well as a friend. When things go wrong, just finding help in your language can be problematic. In such situations, travel insurance can come in very handy. One of our members wonders if their credit card insurance is good enough to be all they need

Does anyone solely use the travel insurance provided through their credit card provider? We will be travelling to Europe for 5 weeks, and are eligible for travel insurance through our CBA platinum card. The insurance is provided through Zurich. Is there anything I need to consider by just relying on this insurance?

The first thing to look at is whether there is in fact coverage. The financial institutions are footing the bill for the insurance and while it may be advertised as a “free” benefit, the cost must be passed on somewhere. This will often be in the form of a higher fee. But it’s also recovered in the fees the banks get when you use your card. As a result, many of the products require you to have booked your travel and paid for the majority of it using the card. If you’re redeeming points, you may not be covered. Fortunately for those redeeming miles, some cards just require a set minimum spend as part of your trip.

My ANZ Platinum is much more generous – only $250 of the overseas travel arrangements must be paid for with the card: “have debited at least $250 worth of eligible overseas travel arrangements to your Platinum card account prior to departing Australia

Another area to check is the type of travel. While overseas travel is where you’re most likely to need help, sometimes insurance is also handy a lot closer to home. Many of the bundled products will not cover you for travel that might be less exotic and more frequent, in the form of domestic trips. If you do travel domestically often, an annual traveller’s policy may make more sense.

Once you have established that coverage is available, the next step is to have a close look at what they pay for. Exclusions are also important, such as pre-existing conditions. A simple visit to a doctor in the last 12 months might exclude you from medical claims. If you’re on medication, anything you are being treated for will often be excluded. Reading the fine print before the trip may be boring, but it can help to avoid panic and extra cost once the journey starts.

The card insurance products can be worthwhile when it comes to travel; you just need to look closely at what you’re getting, which is exactly what many of our members have done. Have you relied on such products for your travel, or do you prefer to pay for a policy from a traditional supplier? Why not share your experiences HERE.

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