Buying your
policy
You do not have to buy travel insurance from a travel agent
or tour operator who arranged your trip. A good reason for
looking elsewhere used to be that the rate of insurance premium
tax you pay was 17.5 per cent if you bought from a travel
agent but 4 per cent if you bought direct from an insurance
company or from an insurance intermediary (which includes
insurance brokers, banks, and building societies). From 1
August 1998, all travel insurance attracts tax at 17.5 per
cent. However, another good reason for avoiding the insurance
policy offered by your travel agent is that it may be harder
to find out exactly what the policy does and does not cover.
The Association of British Insurers (ABI) has a Code of Practice
which says that anyone selling insurance from an ABI member
should give you an explanation of what is and is not covered
by the insurance policy being sold, should point out the main
exclusions, ask you about anything relevant (whether you are
pregnant, or take part in dangerous sports, for example),
and should give you a specimen copy of the full policy wording
if you ask for one, this is fine in theory but surveys over
the years have consistently found that theory does not always
translate into good practice – in the worst cases, the
policy had to be bought before its wording was made available.
If you do not get the answers you need to be happy that you
are getting the cover you require, do not buy the policy.
If you are satisfied that the policy will give you what you
want at a reasonable price, check that the insurance premium
tax is include in the price and make it clear when you want
the policy to start and end. You will have to pay for the
insurance in full in advance wither by cheque or by debit
or credit card. Even with an annual policy, you will not be
able to pay monthly premiums.
As soon as you are given or sent the policy, check that the
cover is what you expected and contact the insurer if there
is anything that you are not clear about. If the cover is
not what you expected, cancel the policy and look for another
insurer.
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