Don't forget travel insurance

By STEVE HART

When can we play football?"

It seemed like the thousandth time the boy had asked his dad. They were on holiday and the guilt eventually set in.

"Come on then - get the ball and let's play."

Within 10 minutes of the game starting the man was on the ground, having broken his ankle doing a David Beckham tackle.

He was in America, where all medical treatment is private, but as he was wheeled into emergency to have his ankle x-rayed and put in a cast he felt confident. The final bill for treatment - possibly thousands of dollars - would be covered by his holiday insurance.

Our fun-loving footballing dad was wrong. He didn't know that playing football, even a friendly game with his son, was excluded from his travel insurance policy. He would have to pay the bill out his own pocket.

Of course, travel insurance is a must-have, but there are holes in this safety net for the uninitiated.

Last year New Zealanders spent $130 million on travel insurance premiums - which have risen by an average of 20 per cent this year according to Karl Dixon, key account manager at Mike Henry. And the amount of cover has been reduced.

Because of September 11 many policies now exclude the failure of firms working in the tourism industry and losses resulting from terrorist attacks.

People are effectively paying more and getting less says Chris Ryan, chief executive of the Insurance Council

Most travel agents are happy to provide cover by recommending their own insurance - which is often another firm's policy branded to look like the agent's own product.

Selling insurance is a good earner for travel agents, who can keep around 20 to 30 per cent of the premium in commission (selling a holiday earns the agent about 4 per cent commission on the package price).

While the terms and conditions of one insurance policy may look much like another, there can be subtle, but costly, differences. It's a good idea to check what you're covered for before you sign on the dotted line.

While abroad, be sure to refer to the policy conditions before carrying out any unplanned activities - such as snowboarding, playing sport or rock climbing.

Frequent travellers who take out annual policies need to remind themselves of the terms and conditions - as they are at risk of falling foul of a policy taken out months before with its list of restrictions a distant memory.

Meet up with your mates for a game of football and Tower Insurance's Provider Travel Policy won't cover you.

Go skiing off piste and most policies will leave you out in the cold.

Among State's Travel Premier restrictions are snowboarding and using a motorcycle bigger than 125cc. Drive a motorcycle without a valid licence (for the country you're in) and QBE's Travel Smart policy will leave you standing - literally.

So, be sure to specify any potentially risky activities you intend doing, such as rock climbing, scuba diving, paragliding or hunting when you take out your policy. You may have to pay extra for additional cover.

New Zealander Derek Watts was paragliding in Austria when he landed awkwardly, injuring his back.

"My first thought was that I had no insurance and so I started to get up and walk around. Before I knew it an ambulance had arrived and I was taken to hospital.

"I was really worried because I had no cover for treatment.

"I was x-rayed and they found a cracked vertebra. They wouldn't let me check myself out as I also had internal bleeding."

Watts was in hospital for two days and had a medical bill of more than $1300. Now he always travels with specialist holiday insurance that includes cover for dangerous sports.

Buy your travel insurance from someone other than your travel agent, such as your credit card company, for example, and you may be charged by your travel agent if you make a claim.

The Travel Agents Association of New Zealand told its 544 member retail agents to charge customers for work they do in relation to a customer's insurance claim.

"When a customer says they have purchased travel insurance from State or through a credit card company, why not say to them - 'Should you have a claim we will have to charge you a service fee as you have not purchased your travel insurance through us and we cannot do work for you without payment'."

If this applies to you then you may be asked by the travel agent to sign a disclaimer.

Since March, many holiday insurance policies have changed so that the failure of travel agents, tour operators, accommodation providers, airlines and car rental agencies, are no longer covered.

This means that if you are abroad, and the airline you have tickets for stops trading, then you may have to pay another airline to get you home without being reimbursed by your insurance company.

The same goes for car rentals. You may have paid for three weeks' hire, but if the firm goes bust then you're on your own.

Hiring a car abroad is essential if you want to see the country at your own pace. But accidents do happen, cars can get stolen and relying on your travel policy to cover any excess payments may leave you out of pocket.

Most standard travel policies offer just $1000 cover for hire-car insurance excesses, and many restrict cover by excluding 4WD and vans. Some don't offer any cover for hire cars at all.

Make a claim in Australia and the hire-car excess is likely to be around A$1500 to A$2500 ($1800 to $3000). Make a claim in Britain and you'll be lucky to get away with an excess of £500 ($1500).

However, if you specify what days you are hiring a car at the time you take out the insurance, excess cover can be increased, often to as much as $4000, for around $10 a day.

It's a tired cliche, but as with anything else you buy, it's a case of buyer beware. Many people buy holiday insurance at the point of booking their holiday and the small print of the policy disappears in the fun and excitement of planning the holiday.

Don't be afraid to ask for a full set of terms and conditions of the policy being offered and check them carefully against what you may want to do while you're away.

If you know you will be rock climbing, paragliding or skiing, check that you will be covered. If it's excluded, ask to pay the extra to have it included.

Foundry Travel Insurance

Insurance Council of NZ