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Why does travel insurance cost what it does?

Have you ever questioned: why is travel insurance so expensive? It may add to the costs of a holiday but travelling with a good policy in place gives you the confidence to travel without worry – especially if you live with a medical condition and/or disability.

Although travel insurance has always been there to cover the cost of the unforeseen, such as travel disruption and unexpected medical emergencies, post-pandemic you may have noticed that travel insurance premiums have increased in price recently.

So, we want to give you a clear understanding of what affects the cost of a travel insurance policy. Plus, how you can get the most out of your policy from the moment you buy one. Below are five factors that affect the cost. Plus, seven ways to get more value from a travel insurance policy.

What is the average cost of a travel insurance policy?

The cost of your policy depends on various factors, including the specific coverage you need; for example, you’d need winter sports cover for a skiing trip.

Below we’ve given an idea of the costs of a single-trip policy for a solo traveller if they’re travelling to France or the USA. We did not include medical conditions when we did the quotes below:

  • A trip to France for a healthy 20-year-old without any pre-existing medical conditions for 10 days is £24.62.
  • For a healthy 80-year-old without any pre-existing medical conditions for 10 days, it would be £85.50

You may have ‘free’ insurance by looking at what your credit card or bank account/s may provide, however, it’s prudent to read the policy in detail. If you need more than a basic level of cover or ignore the policy’s exclusions, such as curtailment, it may leave you underinsured. This could mean that you have to foot the bill for your holiday even if you’re unable to leave home to enjoy it.

If this happens, you’ll be left out of pocket and frustrated but be even more cautious if you have pre-existing medical conditions as some policies will exclude cover for them. Be sure to check this because if you have a related medical issue while away and it is not covered you will be liable for all medical and associated bills. These can often be substantial – in the tens and even hundreds of thousands of pounds.

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5 Factors that affect the cost of your travel insurance policy:

1. Your health

Add any pre-existing medical conditions and/or disabilities to a policy and the price may increase. However, if you are tempted not to declare a medical condition and/or disability to reduce your premium, be aware of the risks. If a condition is not declared and it leads to a medical issue while abroad, a future claim could be rejected. This would result in a trip being even more expensive than you imagined. Medical costs abroad can exceed several thousands of pounds, which you may need to fund from your pocket if your insurer won’t pay out because of non-disclosure.

You may know that the number of specialist insurers who provide cover for people living with serious pre-existing medical conditions and disabilities is limited. However, Free Spirit Travel Insurance was the first to cater specifically to people of all age groups who live with medical conditions and disabilities and the rest of their travelling party. So, you can get cover for the whole family under one policy.

2. Your age

Unfortunately, reaching an age milestone makes a difference to the cost of travel insurance. When travellers reach 50 years old, they may start to see premiums increase and travellers aged 64+ pay higher premiums or could be excluded from purchasing a policy entirely. Higher premiums are demanded by insurers because there’s a greater risk of seniors claiming healthcare and medical expenses. To find a suitable quote for travel insurance shop around – there are specialist travel insurance providers who can offer competitive rates depending on your circumstances.

3. The destination

Many countries don’t provide the same level of healthcare as the NHS. So, the price you pay for a travel insurance policy will vary depending on the destination. Instead, there are reciprocal healthcare agreements between UK and EU and non-EU countries but healthcare is more expensive depending on that country’s approach.

One way to reduce the cost of travel insurance while still receiving healthcare is to visit a European holiday destination. However, if you choose Switzerland or an EU country, apply for a Global Health Insurance Card (GHIC) before leaving home. This makes you eligible for reciprocal healthcare and may mean that the insurer will reduce or waive the excess payable. Also, the cost to take you home (repatriation cover) will be lower.

The highest costs for medical treatment are in North America, (the USA and Canada). Although, Africa and Asia are not the cheapest continents to visit either.

To help you grasp the cost, in 2022, the cost of staying in a hospital, for one night in a European hospital (Belgium or France) was $157. Meanwhile, in Nigeria, it reached $372. As you can see, it’s easy for healthcare costs to quickly escalate when you need medical treatment abroad.

visiting European destinations reduce the cost of travel insurance

4. Expensive items

Your camera (and its accompanying lenses) may capture the perfect scene. An item of jewellery could be a necessity to mark a special celebration you are planning while away. Whatever the reason for taking the item – if it is expensive it may exceed the maximum amount you can claim for (any single item) on your policy. So, you’ll need to pay extra and buy a policy with increased cover. To travel without worry, leave expensive items that attract attention at home.

Alternatively, you may wish to check your Home Contents policy, as some will cover the full value of expensive items outside the home for up to 60 days. As always, check the policy terms and conditions.

5. Duration of the trip

In essence, the longer the trip the higher the cost of travel insurance. The shorter the trip the lower the cost of travel insurance. This is because if you’re in a destination for a longer time, there is more chance that a claim will be made.


Travel insurance costs and the Coronavirus Pandemic

It’s true to say that the pandemic immediately put a strain on the world’s medical infrastructure due to a high and unprecedented demand for healthcare. Therefore, the costs to maintain the medical workforce, infrastructure, as well as additional hygiene measures rose, causing a high rate of inflation in the medical sector. Alongside all this, the war in Ukraine continues to impact global supply chains and energy prices, exacerbating the rising prices.

As a result, the cost of medical claims on a travel insurance policy has risen, meaning that premiums have had to rise in line with them.

Why has my travel insurance gone up?

This could be due to one or more of the following reasons:

  • Changes to your health or medical condition.
  • The number of claims the insurer has received.
  • Reaching an age milestone.
  • If you purchase a travel insurance policy while already travelling. It is possible to source travel insurance after you’ve set off. However, already travelled cover will be more expensive.
  • Purchasing your policy in advance offers cancellation cover as soon as the policy starts. However, the further from the departure date you book your insurance – the higher the cost may be.

emergency medical care

7 Ways you can get more value from your travel insurance policy:

1. Purchase your travel insurance policy as soon as you book your trip. (ASAYB)

Martin Lewis coined this phrase last year when there was a surge in demand for holidays – before several flight cancellations and strikes took place. It’s hard to predict if, when, and where flights will be cancelled after booking a trip, as well as other unexpected scenarios. Also, some policies don’t cover strikes or events that are known at the time of booking.

So, remember – a considerable portion of the travel insurance premiums cover pre-departure risks and purchase travel insurance ASAYB.

2. Read the terms and conditions

If you’re participating in any sport, ensure you’re wearing the appropriate safety clothing, such as a helmet. Plus, make sure the activity you plan to do matches your experience. For instance, if you know you’re an amateur skier build up your experience and confidence before attempting a black run.

Check that your policy covers the activities you are planning to take part in and read the exclusions that apply when taking part in these activities.

Also, it goes without saying that if you’ve had too many alcoholic beverages before being involved in an altercation, accident, or theft, then the travel insurance policy is unlikely to provide cover. It will then be hard for your travel insurance policy to provide full value.

3. Purchase a Multi-Trip Policy

Travel regularly? You can save money by purchasing an annual multi-trip travel insurance policy instead of a single-trip policy. Plus, you’ll be covered for additional (even spontaneous trips) in the coming year inside or outside of the UK. Remember to check the terms and conditions and remember that a Free Spirit annual policy has no upper age limit (while many others do).


4. Consider a Family Travel Insurance Policy

Some policies only cover you and only those who live with you. This can be cheaper than purchasing a policy for each person. If you require cover for a medical condition and/or disability one of the benefits of a Free Spirit policy is that cover is provided for the whole party – on the same policy, whether they’re living with an existing medical condition or not. This is a great benefit because if you had to cancel your holiday due to a medical condition, all companions on the policy would be covered. However, if a travelling party used more than one policy, it is much harder to claim under the polic(ies) that don’t include the injured person.

5. Consider an increased excess

To save further, consider purchasing a policy with a high excess. However, be aware that this means you will need to pay more if you need to claim on your policy.

Free Spirit does not have a policy that offers a choice to opt for an increased excess. However, you can look at the lower levels of cover to ensure that these cover limits are still included and adequate for your requirements.

6. Get the correct travel insurance policy

Whether you need a Single-Trip Policy or a Multi-Trip Policy for a solo trip or family holiday ensure you have full financial cover for any eventuality.

What a good policy covers:

  • All destinations you intend to visit.
  • All your travelling companions.
  • All activities – Free Spirit includes 100 activities for free with each policy.
  • Baggage Cover from home to hotel and back again.
  • Cancellation and Curtailment Cover if your trip’s cut short or cancelled completely.
  • Travel disruptions – missed departure and travel delays.
  • Travel abandonment.
  • Personal Liability Cover.
  • Emergency medical treatment.
  • Expenses for a close relative or friend to stay or travel to you from the UK.
  • Repatriation Cover, to bring you home later than planned.

View what a Free Spirit policy includes.

7. Source specialist travel insurance

Are you travelling with a medical condition and/or disability? Going on an adventure, cruise, or winter sports holiday?

If you need specialist travel insurance but are unsure which is best to cover your entire trip contact our caring and compassionate UK based call centre team. They’ll be happy to assist and will help you set off with peace of mind.

travel insurance for peace of mind

A quote from our Chief Operating Officer

“Travel Insurance continues to navigate through ever-changing times is characterised by a noticeable change in the general market and a hardening of rates.

This change mirrors various factors such as rising holiday costs driven by UK inflation and the ever-escalating expenses associated with overseas medical care.

However, the desire to travel is as strong as ever, highlighting the importance of having a reliable travel insurance policy to ensure peace of mind and the ability to Travel, With Confidence.”

Travel insurance is important

With all these factors in mind, we hope we’ve given you an insight into why travel insurance is important to have in place as soon as you have booked a break despite the cost.

Last summer (despite the cost of living), many people spent more on their holidays than usual. Plus, they were wise. 73% were keen to protect their dream holidays they’d invested in because they were more or equally concerned about safeguarding the cost of their holiday – compared to previous years. Where you one of them?

If you’d like to protect your holiday this year and are researching a travel insurance policy to cover a medical condition and/or disability, consider Free Spirit.

Compare the differences between the cost of a Free Spirit Annual Multi-Trip Policy and a Single-Trip Policy and use the best one to give yourself the freedom to travel, with confidence.

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