Travel and personal accident

You need to think about what could happen to you. Travel insurance is one of the messiest and worst sold types of insurance in the UK. Millions of travellers holiday without it and competition between providers is so fiercely price-based that cover levels have been severely cut back. When the Icelandic volcano ash cloud disrupted air traffic, most insurers said claims were not covered.

But that just means we need to take extra care when buying ravel insurance. First, we need to think about being covered for work trips and not just holidays. If you travel for work you will need to pay extra for those journeys to be included.

Activity holidays

You will need to be clear about what you might be doing on your trips too. We all know that winter sports – skiing and snowboarding – are not covered unless you buy the extra cover, but many other activities are typically excluded or have reduced cover. Very few insurers, for example, will cover you riding a motorbike bigger than 125cc – you’ll need to find an insurer that will if you intend to ride your own bike on your travels or hire a bike while away. Many other activities, such as horse-riding, may be added to standard policies but it may be better to consider a policy specifically aimed at that activity.

If you are going mountain-climbing, or white water rafting, or taking part in any other activity that is likely to put you at risk in an unusual location, it might be best to consider a specialist policy - the claims departments will have access to specialist search and rescue services and have medical teams that understand how to rescue injured people from cliff tops or ravines (your run-of-the-mill medical assistance firm will know how to deal with hotel food poisoning, sunburn and car accidents on motorways).

Day tripper

You also need to consider being covered for day trips – some policies kick in when the travel involves one night’s stay abroad whereas you might fly out for the day and return that evening. There’s no point in having a travel insurance policy that doesn’t cover you for a day trip to Dublin, Paris or Brussels.

And then there’s the need for travel insurance to cover UK travel too. If you book a staycation but need to cancel it due to unforeseen circumstances you’ll need travel insurance to get your money back. But more than that, if you have an accident while away, sure, the NHS will patch you up and put you back together again but the NHS does not have to pay for you to be brought home and treated in your local hospital. Travel insurance would provide a private ambulance, once you were safe to travel, to bring you to a hospital nearer home or your family.

Add all these demands together and you almost certainly won’t be able to buy a standard travel insurance package online or from a direct insurer. You’ll need a broker to find a specialist policy for you.

Accidents never happen (in a perfect world)

Another policy well worth considering is personal accident insurance. Elements of this are often included in a travel policy – if you lose a limb, for example, it pays out a fixed sum. But a standalone policy can have added benefits for freelances: you can buy daily benefits should you be temporarily disabled – if an actor should literally “break a leg”, for example.

You will need to calculate how much income you would need if you were unable to work. This income is not taxed so you only need to cover your after-tax income. The more you need, the more expensive the insurance, but it is much cheaper than you think. The policy will not pay out for the first seven days, normally, though there might be additional exclusions, such as not paying out for 14-days if you had the accident carrying out a dangerous activity. But the policy will pay out for up to two years.

Of course, you could just say it will never happen to you. But having been involved in a car crash that left my wife (another freelance) in hospital for four months and in the care of social services for a further six, I’ve learned my lesson the hard way. I didn’t have personal accident insurance then and was forced to sell my car and nearly lost my house.

We now have a policy that costs about £550 a year and pays out £100 a day for each of us if we’re injured. I calculated that rate on the basis that if one of us were in hospital, the other would be forced to work much less. As it happens, our only claim was when I broke my wrist. I was in plaster for a little over three weeks. The first seven days were not covered but I was paid £1,700 for the 17 days after that until the plaster was removed.

Talk to your broker about the right level of personal accident insurance for you.

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