Diana Clement: Travelling abroad? Check your insurance

Allianz and Cover-More do offer medical and cancellation cover for the Cook Islands. Photo / 123RF

Are you champing at the bit to visit Australia, the Cook Islands or farther afield? What say the unexpected happens and Covid disrupts your plans, or makes you seriously ill?

When Covid hit in March last year our insurers said: "Sorry mate, Covid, no cover". Their logic wasn't brilliant. Only a very small fraction of people who catch Covid end up in hospital or stuck and unable to fly home.

Much as I'd love to travel, like many people I'm waiting for more certain times, and comprehensive insurance cover. Yet plenty of Kiwis are booking flights across the Tasman and to the Cook Islands to see loved ones or take a holiday.

I certainly hope they've taken out insurance and read their polices. The Catch-22 is getting cover for Covid.

By necessity for their business, the airlines were first to step in and offer Covid cover. Bit by bit insurers are beginning to cover some travel risks associated with Covid.

Some companies offer nothing Covid-related. Others include limited cancellation cover if you can't go; and a few offer medical cover should you need treatment for Covid overseas.

Big insurers Allianz and Cover-More do offer medical and cancellation cover for Australia and the Cook Islands. Those two underwrite the policies for Air New Zealand, Flight Centre and House of Travel. Don't assume, however, that the company you choose to insure with offers anything.

Tim Grafton, chief executive of the Insurance Council of New Zealand, says those policies that do cover Covid offer some or all of these contingencies:

• Cancellation costs if you contract Covid and can't travel.

• Costs to return home if a relative gets sick with Covid.

• Costs if you get sick with Covid and need to quarantine while overseas.

• Reasonable costs if the person you are supposed to stay with gets Covid and you need to find alternative accommodation.

• Cancellation costs for denied boarding due to a positive Covid test at the airport.

• Being a close contact of someone with Covid.

Grafton adds that you're not covered for any government action or intervention, such as suspension of travel.

If ever there was a time to actually read your policy and understand it fully, this is it. It took me multiple calls back and forth to several insurers and travel booking companies for me to be 100 per cent clear of what was on offer. If you don't understand what your policy says, ask for clarification, preferably in writing.

Check what is covered before you travel. Photo / 123RF

There is no Covid cover of any sort for countries for which our government has a "Do Not Travel" warning for. That means you're not covered for Covid-related claims for travel to any country in the world except Australia and the Cook Islands. You would still most likely be covered for other risks such as a broken leg.

You're not covered for any government action or intervention, says Grafton. That's things like the temporary suspension of travel from India and our bubble with Australia.

Our largest travel insurer SCTI doesn't have any Covid-related cover. SCTI chief executive Jo McCauley hints that some insurers may not be transparent in their Covid cover. She says the number one cover customers want is for being stranded should the bubbles burst. No travel insurance policy currently covers for an extended stay, or MIQ fees in that scenario.

This all got me thinking, and in some ways so-called Covid cover is a marketing tool. It sounds good and entices customers to part with their money. Your actual chances of catching Covid in Australia or the Cook Islands are miniscule. Whereas your chances of being temporarily stranded from a bursting bubble are quite high, but not covered.

Your travel insurance of course covers you for all the other normal things travel insurance covers such as accidents, other illnesses, theft, delays, cancellations and so on. So still worth paying for if you don't want to be the next sob story on Givealittle.

Finally, Covid cover for cruises is scarce. Most insurers aren't willing to go there yet - although some, such as Allianz Partners, do offer some cover.