How to Choose the Right
Budget Travel Insurance

If your camera breaks, your gear gets stolen or you need urgent medical help abroad, your budget travel insurance will have been a life saver and priceless investment.

Get the wrong insurance, though, and it will have been nothing but a waste of your time and money.


And it all comes down to the fine print — the policy terms and conditions, limits and exclusions.

Boring and tedious details, I know. But parting with thousands of dollars over rejected insurance claims isn't much fun either!

budget travel insurance florida alligator Always read the small print! – Florida, USA Sam Howzit on Flickr

Don't Let the Fine Print Catch You Out

Insurance companies worldwide are notorious for using their countless rules and regulations (some being open to interpretation) to wriggle out of paying for claims.

No wonder! When a policy is pages and pages long, it's easy for even the most seasoned traveller to overlook something.

But overlook what, exactly?

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    Do you even need budget travel insurance?

    Of course, I'm not suggesting you go backpacking around the world for a year without it!

    But have a good look at some of the national or private health plans you already belong to and other insurance policies you hold. One of these might insure you for travel away from home.

    It's also worth checking out your credit cards and even bank accounts. They sometimes cover you abroad, too.

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    Is there an upper age limit?

    Many budget travel insurance companies won't insure you after a certain age (typically 60-65).

    So if you're anywhere near that age bracket, check that you even qualify for the policy before you bury yourself in the fine print.

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    Is the insurance valid worldwide?

    Are you likely to end up in some really off-the-beaten-track places or possible danger zones? Check your policy for any country exclusions.

    Travelling around the USA, Canada, Japan or the Caribbean? Insurance companies don't always include these as standard. Make sure they're listed in your policy.

    Only heading over to Europe? You can often get a much cheaper quote based on one continent or geographical region.

Backpacking around your own country? You'll probably have to look elsewhere for cover. Travel insurance usually only kicks in after you've crossed the border.

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    How long can you travel for?

    Some budget travel insurance policies are just not geared towards long-term backpacking.

    And despite its name, annual travel insurance doesn't actually let you take off for an entire year at a time — there's a limit to the number of days you can be away for any one trip (usually no more than 60).

    Make certain that what you're getting is continuous insurance cover for the duration of your travel.

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    Does the policy cover the most important basics?

    That means not just medical bills but also trip cancellation, emergency evacuation, repatriation, high-risk activities, personal liability, urgent dental treatment, lost or damaged backpacking gear and a slew of other things.

    You can find out more about all of these in the international travel health insurance section.

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    How much is the deductible (excess)?

    Budget travel insurance policies come with a deductible (or excess). This is the amount of money you'll have to pay out-of-pocket before the insurance company dishes out the rest.

    Typically, excess starts at around US$100. The higher your excess, the lower your insurance premium.

    Sometimes you can pay a bit more to get excess waiver. In other words, zero deductible. This is probably worth the few extra bucks, especially if you end up having to make a bunch of small claims.

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    Are all your valuables covered?

    Cheap travel insurance won't usually pay out for expensive items like jewellery, smartphones or laptops unless you'd specifically had them written into the policy.

    And insurers offering new-for-old plans will normally insist on repairs before they agree to replacements.

    On top of that, most insurers have a maximum overall and per-item claim limit!

    This means that, with a deductible, the actual compensation for your damaged camera could turn out to be a mere fraction of its real value.


budget travel insurance gold souk dubai Maybe I'll leave this stuff at home after all – Dubai, UAE ShoestringBackpacking.com

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    What are the maximum claim limits?

    In many countries, the price of a doctor's visit, out-patient care or overnight hospital stay can be shockingly expensive. Add to that an air ambulance, injury to a third party or legal expenses and you're talking one whopping sum of money!

    Compare travel insurance carefully. Depending on where you'll be backpacking, ensure you have at least US$1 million medical cover — preferably more.

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    Are any sports or activities specifically excluded?

    This is where you need to consider what you're likely to get up to during your round the world trip.

    White water rafting in Nepal? Hot air ballooning in Turkey? Snowboarding in Switzerland? Zorbing in New Zealand? Golfing (yes, even golfing!) in Scotland?

    Your budget travel insurance should cover you whatever you do.

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    What about pre-existing medical conditions?

    It is possible to get insured for certain health problems you're already aware of or have been treated for in the past — but it's not always easy and it usually doesn't come cheap.

    So if you've got a medical condition that could cause you trouble on the road, check that your insurer will foot the bill.

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    Are certain travel vaccinations required?

    Needle-avoiders like me, take note:

    Treatment for vaccine-preventable diseases is specifically excluded on most budget travel insurance policies.

    Some shots need a series of injections several weeks apart, with the last one done no later than 10 days before you travel. So start looking into this early.

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    Does the policy cover mopeds, scooters and motorbikes?

    Chances are high that at some point during your round the world travels you'll end up on the back of a motorcycle taxi or hire a scooter to boot around on for a day or two.

    However careful you may be, accidents do happen. If your cheap travel insurance doesn't cover you, find another one!

    (It's a different story altogether if you're renting a car. You'll almost certainly have to take out separate insurance for that.)

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    Will you have access to 24-hour assistance in your own language?

    Your travel insurance won't be much use in an emergency if you can't get ahold of your insurers or they only speak Greek (unless you also speak Greek, of course!).

    Make sure help is available to you, in your own language, 24/7/365.

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Most importantly . . . ask before you pay!

If you're not convinced you've got exactly what you need in your budget travel insurance policy, call the insurers with your questions.


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Any thoughts? Leave a comment!