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Is it worth buying travel insurance for a ‘staycation’?

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With many nervous about taking an overseas trip, Brits are booking up holidays closer to home. But should you buy travel insurance?

Lockdown measures and social distancing are easing which means Brits will be able to take overnight trips in the UK.

Cancellation cover is critical for any trip as it provides cover for lost costs should you need to cancel your booking in an emergency, such as injury, illness or bereavement.

However, business information site, Defaqto, found that 66 or 8% of annual policies on the market don’t include cancellation cover as standard, with 52 (6%) only offering this as an upgrade.

Travellers should also consider cover for luggage and personal belongings. If your luggage is lost or stolen while on holiday, this cover can provide a lifeline to help you buy essentials while away and cover the cost of replacing your luggage.

Again, Defaqto revealed this isn’t always covered as standard, with 77 policies (9%) not including cover. Limits can also be relatively low at £1,550 on average, with some policies only including £200 worth of cover. However, you may already have cover for personal possessions under your home contents insurance policy, which usually provides much better cover for your belongings, so it’s worth checking that before doubling up on cover.

When it comes to event or activity bookings, you could face a big loss in the case of cancellation. The majority of policies on the market cover these costs in the event of cancellation or even missed departure, which could provide some peace of mind when booking.

As things currently stand, most insurance policies will cover UK trips, although with a few caveats.  Usually the trip accommodation must be pre-booked, and of a minimum length of two nights or more. Eight in 10 (82%) of annual policies only cover trips of two nights or longer. This means you won’t be covered if you book a hotel for one night, or find that you can’t take a trip you meant to but hadn’t booked any accommodation.

Holidaymakers are reminded that travel insurance is intended to be a safety net and if you have to cancel, insurers will expect you to have attempted to get refunds from other sources first.

Brian Brown, consumer finance expert at Defaqto, said: “As much as you can’t guarantee the weather, you can’t book a holiday and guarantee nothing will go wrong. We usually associate travel insurance with overseas trips but it can provide invaluable cover for UK trips too. If you have an annual travel policy, you may already have cover within it.

“In the current climate, it is important to note that many insurers will not cover you for claims arising from Covid-19.  For example, if you have booked a cottage and the day before you travel one of your party is diagnosed with Covid-19 some insurers won’t pay any cancellation claim. Similarly, if you are advised to self-isolate due to symptoms, for which you have no formal diagnosis, you still won’t be covered. Travellers planning holidays in the UK should check with their insurer to see what cover they have, before booking their holiday. For most other risks, travel insurance can provide peace of mind and is definitely worth considering wherever you go on holiday.”

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