How does insurance actually work?

[Gelatoni]

This might be a stupid question, but having never claimed on travel insurance in my life i'm not sure on the logistics of it. Maybe someone can help relieve my worry over this!

If I was forced into not being able to go based on FCO advice (i'm assuming they wouldn't cover Tokyo Disney being closed!), how would it work if i wanted to change everything?

Do you call the airline/hotel provider and change it yourself to another location/date, and claim it back? Or do you claim after cancellation of the holiday, get your money back and then use that to rebook something else? If so is that a long process?

I've seen other Dibbers have completely changed their holidays already and wondering how this was done!

[disney332]

You only claim on an insurance policy when you suffer financial losses and associated costs, if applicable, that have been underwritten by the insurer.

You need understand what you are covered for and whats excluded. Presumably you are aware of that already.

Disney332

[TGT]

Some flight operators and travel agents will allow you to just change your holiday plans and waive their admin fees for doing so, in this case there is no need to reference your insurance as - as disney332 says - you haven't lost anything

You are right you are unlikely to get anything just because a Disney Park is closed (similarly in Florida after a hurricane) it's just bad luck. However, if the FCO said you shouldn't go to Japan and the airline said, well, your flight is going so tough, or you were on a local tour and they said well the tour is going so we will still charge you - then you go to your travel insurance to see if you have cover.

The virus info is tricky and different insurance policies allow different cover - but, all you can do is ask. If you want to know in advance, call and ask exactly what is and isn't covered (or read your policy).

All you can do is read your policy closely and if it's not clear, give them a call.

Here's more information from moneysavingexpert.com

moneysavingexpert/ne...d-your-rights/

[Gelatoni]

Thank you both. I have scoured our policy and know what is covered, I just don't know the process and how it comes into play in practice as i've never claimed.

Do people pay out again in change/admin fees on the flights and hotel and claim that back, or cancel everything and advise the insurer this to get all the money back?

[Caroian]

If you're able to change things around then generally you cannot claim on insurance. So for example if you move the same holiday to a different date, or a flight company allows you to move your flights to a different destination. If the changes end up making the holiday more expensive, that is for you to pay. You can only claim if you suffer a financial loss. So the first decision to make is whether you want to try to alter your holiday. If you do, then you need to see if you can and what it will cost you.

If you can't, or don't want to (or decide the replacement holiday is too expensive) or you want to book a completely different holiday that just happens to be at the same time, then the next step is to cancel as many parts as possible of your original holiday and see what money you can get back. So flights will refund taxes, some hotels will refund all money if cancelled by a certain date. Once this is known, you can see exactly how much you are out of pocket and submit a claim for this amount - with evidence - to your insurance company. Insurance will obviously not pay out for things you can get refunded from the supplier. It can take a while for a claim to go through so you need to be sure you can still pay for the alternative holiday first before payments come through. Insurance deals only with the financial losses, not sorting you a different trip.

Of course, if you've booked a package, or through an agent, they are your first port of call.

Do also make sure you have read all the fine print on your insurance. Some policies will not cover you for cancellation even in the event of an FCO advisory not to travel - sometimes you need additional add ons (often called Travel Disruption Cover). Most policies will not cover you for claims arising if you travel against an advisory, but this doesn't mean they will automatically pay out for cancellation, absurd as this may seem.

[Gelatoni]

Originally Posted by Caroian

If you're able to change things around then generally you cannot claim on insurance. So for example if you move the same holiday to a different date, or a flight company allows you to move your flights to a different destination. If the changes end up making the holiday more expensive, that is for you to pay. You can only claim if you suffer a financial loss. So the first decision to make is whether you want to try to alter your holiday. If you do, then you need to see if you can and what it will cost you.

If you can't, or don't want to (or decide the replacement holiday is too expensive) or you want to book a completely different holiday that just happens to be at the same time, then the next step is to cancel as many parts as possible of your original holiday and see what money you can get back. So flights will refund taxes, some hotels will refund all money if cancelled by a certain date. Once this is known, you can see exactly how much you are out of pocket and submit a claim for this amount - with evidence - to your insurance company. Insurance will obviously not pay out for things you can get refunded from the supplier. It can take a while for a claim to go through so you need to be sure you can still pay for the alternative holiday first before payments come through. Insurance deals only with the financial losses, not sorting you a different trip.

Of course, if you've booked a package, or through an agent, they are your first port of call.

Do also make sure you have read all the fine print on your insurance. Some policies will not cover you for cancellation even in the event of an FCO advisory not to travel - sometimes you need additional add ons (often called Travel Disruption Cover). Most policies will not cover you for claims arising if you travel against an advisory, but this doesn't mean they will automatically pay out for cancellation, absurd as this may seem.

See more...

Thank you, this is really insightful and helpful.

So paying more money out to change the trip because you've lost the money you've spent on it already (e.g. FCO is 'no go' but airline will only refund taxes, and new flight is same price or lower) wouldn't count as financial loss?

If that's the case and i've understood that correctly, i'm better off cancelling everything (FCO depending), and starting a claims process to get all the money back, rather than messing around with changing anything.

I guess i always thought if the airline said 'you can only have your tax back', and you then paid them effectively twice for a new flight (assuming price was the same or less) somewhere else, you could still get the money back that you lost on original flight?

Thanks again 🙂

[Caroian]

Originally Posted by Gelatoni

Thank you, this is really insightful and helpful.

So paying more money out to change the trip because you've lost the money you've spent on it already (e.g. FCO is 'no go' but airline will only refund taxes, and new flight is same price or lower) wouldn't count as financial loss?

If that's the case and i've understood that correctly, i'm better off cancelling everything (FCO depending), and starting a claims process to get all the money back, rather than messing around with changing anything.

I guess i always thought if the airline said 'you can only have your tax back', and you then paid them effectively twice for a new flight (assuming price was the same or less) somewhere else, you could still get the money back that you lost on original flight?

Thanks again 🙂

See more...

There is a difference between "changing" a flight and cancelling and rebooking. Insurance won't compensate you for a change, because you are still getting a service. You will often be better off to cancel completely (and claim what you cannot get back from the airline from insurance) rather than altering the dates or destinations. Any new booking then counts as a completely separate holiday (and you need to ensure you have adequate insurance for that booking - taking in to account that bookings made now, and insurance policies started now, may have different terms as the current outbreak is now "known").

It is very much dependent on FCO advice though, as insurance won't pay out just because you no longer fancy going. In this situation looking at changing your holiday might work out financially better than cancelling it and losing everything. It's very difficult right now as it is such a fast moving situation!

[Gelatoni]

Originally Posted by Caroian

There is a difference between "changing" a flight and cancelling and rebooking. Insurance won't compensate you for a change, because you are still getting a service. You will often be better off to cancel completely (and claim what you cannot get back from the airline from insurance) rather than altering the dates or destinations. Any new booking then counts as a completely separate holiday (and you need to ensure you have adequate insurance for that booking - taking in to account that bookings made now, and insurance policies started now, may have different terms as the current outbreak is now "known").

It is very much dependent on FCO advice though, as insurance won't pay out just because you no longer fancy going. In this situation looking at changing your holiday might work out financially better than cancelling it and losing everything. It's very difficult right now as it is such a fast moving situation!

See more...

Thank you.

Will just have to wait and see what the FCO advice is closer to the time. Having looked at BAs booking conditions, it looks like it would very expensive to change it, tantamount to a new booking. The hotels are also non-refundable.

What an uncertain time we're in