How a beer on holiday could cost you your travel insurance

This might be the most expensive pint on the planet. Photo / Getty Images

A pint of beer is a common unit for travellers measuring the real-world value of a destination.

While Bahts and Kronor might mean little to a Kiwi traveller, knowing that in Bangkok $2 will buy you a beer indicates a cheap holiday. Meanwhile in Oslo, $20 pints encourage temperance and a stricter holiday budget.

However, in some cases just one beer could end up costing an unlucky traveller hundreds of thousands of dollars.

Recently a UK tourist was left looking to cover thousands of dollars in medical expenses, after The Sun reported their travel insurer found a 'trace' of alcohol in the patient's blood.

The 64-year-old tourist had suffered a brain haemorrhage while on holiday, and the insurer refused to pay out after it emerged he had been drinking.

The family of the patient announced their intention to appeal the insurer's decision, but would be billed thousands of dollars if unsuccessful. "We want people to be aware how wishy-washy travel firms are over their alcohol policies," they told the newspaper.

However, while few insurers have a zero-tolerance policy on claims indirectly related to alcohol, there is little consensus on what level will lead to a claim being rejected.

The incident makes a case for paying closer attention to the small print and not always opting for the cheapest travel cover you find.

"Most insurance policies will include a blanket exclusion for any claims that are the result directly or indirectly of a traveller being under the influence of alcohol or unprescribed drugs," said insurance expert Bessie Hassan, in an interview for news.com.au.

In claims of over $100,000 investigators are sometimes hired to corroborate the extent that alcohol had to play in the accident, and the amount of drink consumed.

Conditions like asthma may make you insurance more expensive, but void it entirely if undeclared. Photo / Getty Images

While alcohol is one reason for travel insurers failing to pay out there are a number of other common pitfalls.

Don't delay

Insurers Allianz Assistance says that one in five travellers leave buying insurance to the very last minute, even if they've been planning a holiday for months.

Getting a policy soon as booking a flights or a holiday can avert disaster.

Allianz reported the most common reasons for cancelling a holiday as an accident or injury.

Cheapest is not always the most cost effective

The market for insurance means that companies offering cheap insurance often have very flimsy cover and very limited protection for yourself and your belongings.

Spending a bit more on insurance may save a lot more in the case of an expensive bill.

Wishy-washy: Many high value items such as tech are not covered under standard travel policies. Photo / Getty Images

Honesty is the best policy

Declaring previous ailments may push up your premium but you risk loosing any sort of pay-out if you fail to inform your insurer and are found out.

Previous sufferers of cancer, asthma or high blood pressure are often asked to declare these conditions.

Electricals not included

Many insurers only offer cover for expensive tech such as laptops through additional add on insurance. It's worth knowing if home insurance covers your belongings abroad, and what kind of excess you're likely to have to pay.

Going climbing? Your insurer might not be so keen on your dangerous hobbies. Photo / Getty Images

Adventure sports

Rock climbing, horse riding, cave diving – these all sound like the makings of a great adventure holiday, but your insurer might not be so keen on your hobbies. It's worth reading your policy's small print if you know you are planning anything particularly thrilling.
Due to the high-risk nature of snow sports, insurers commonly offer different more expensive options for skiing holidays. Needlessly to say these activities are not covered in the standard insurance options.
Last year a British backpacker was refused a pay out from InsureandGo, after the insurer deemed the dive into a swimming pool that broke her neck violated a 'Reckless Behaviour' clause in her policy.