Travel Insurance and terrorism

Terrorism: it's a scary word, and one we'd rather not think about when planning our next trip abroad.

Unfortunately, events like 9/11, the Bali bombings and the attacks in Paris, have altered the way we travel forever. Tighter travel regulations have become the norm and heightened security risks are commonplace.

Whilst these events should not stop travellers from heading abroad, it's simply smart practice to protect your travel plans against the impact of an attack. That being said, plenty of confusion surrounds travel insurance as it relates to terrorism. More specifically, will travel insurance cover an act of terrorism?

To begin with it's important to understand that every travel insurer will handle a terrorist incident differently and will have varying cover exclusions. Although most insurers will generally consider terrorism or acts of war to be an exclusion a few will offer limited cover...keep reading for more.

Travel Insurance And Travel Warnings

As soon as a terrorist attack occurs the government will issue travel warnings for that region or country. Restrictions will now apply to those destinations and you would generally not be covered to travel to those regions (particularly those with a level 4 or 5 government warning). Should you choose to travel to a country against government warnings your cover benefits may be rendered void.

Cancellations Or Delays Due To A Terror Attack

In the event of a terrorist attack or political unrest, most if not all policies exclude cover for cancellation fees & lost deposits, disruption of journey or alternative transport expenses. Though it's a difficult pill to swallow, insurers ruled out these specific benefits after the risk of terrorism were deemed too great. However, plenty of insurers will still provide cover for medical cover in the event of a terror attack.

Which Insurers Cover Terrorism?

Every insurer will offer varying degrees of cover. As always, benefits will differ across ranging cover levels. The following summarises the terrorism benefits across a range of travel insurers:

ID	Underwriter	Medical cover due to terrorism	Coverage to cancel due to terrorism
1Cover	HDI Global Specialty SE - New Zealand	yes, except domestic policies	Quote
TINZ	HDI Global Specialty SE - New Zealand	yes	Quote
Zoom Travel Insurance	HDI Global Speciality SE - New Zealand	yes	Quote
AA Travel	AWP Services New Zealand Limited	yes, coverage up to $250,000
Air New Zealand	Zurich Australian Insurance Limited	yes
AMI	Zurich Australian Insurance Limited	yes
AMP	AWP Services New Zealand Limited	yes, coverage up to $250,000
Cover-more	Zurich Australian Insurance Limited	yes
NIB	Pacific International Insurance Pty Ltd	yes
Southern Cross Travel Insurance	Southern Cross Benefits Limited	yes, coverage up to $100,000
State Travel Insurance	Zurich Australian Insurance Limited	yes
Tower	AWP Services New Zealand Limited	yes, coverage up to $250,000
Webjet	Zurich Australian Insurance Limited	yes
World Nomads	Certain Underwriters at Lloyds	yes
Worldcare	The Hollard Insurance Company Pty Ltd	yes, coverage up to $200,000

General Advice Warning: The contents of this article were accurate at the time of writing. Insurers change their policies from time to time, so some information may have changed. You should always read the Product Disclosure Statement of your chosen insurer to understand what is covered and what isn't. The information provided is of a general nature only and does not take into account any personal objectives, financial situation or needs. Before making a decision you should consider the appropriateness of the information having regard to your personal circumstances.

What Are My Options?

In the event of a large scale terror attack such as the November Paris attacks, plenty of travel and transport companies responded to customers concerns with humanity, allowing them to postpone their bookings.

However, with the more global threat of terror it can be good practice to have a back-up plan should you need to cancel or delay your trip.

As well, it may be worthwhile looking for accommodation deals that allow free cancellation (often possible on sites like Booking.com and Expedia). Be sure to check the fine print to ensure you're not caught out by any additional fees or upfront pre-payments.

Flexible fares may be more expensive but could pay off when weighed up against the potential emotional and financial cost of a trip cancellation. It may also be worth looking into package holidays. Although these won't neccessarily have flexible cancellation policies, the operator will be under legal obligation to ensure your safety in a crisis.

Medical Expenses Due To A Terror Attack

A few insurers do provide cover for medical and hospital expenses caused by an act of terrorism, including the cost of bringing you back home. If your insurer is not on the list above, it's crucial to review your policy coverage, as every insurer will vary in their benefits.

In any case, medical cover is essential for travellers headed abroad. The risk of being exposed to illness or injury is simply not one worth taking once you consider the full cost of medical and hospital expenses overseas. Add to that the expense of medical evacuation, accidental death or total permanent disability and the need for travel insurance cannot be over emphasised.

Whilst you not be able to rely on travel insurance for all terrorism related claims, it is still vital to take out a policy before you head away. The New Zealand's Ministry of Foreign Affairs and Trade (MFAT) website, SafeTravel can be a very useful resource and one worth checking regularly to stay abreast of any current events. The New Zealand government can help travellers during and after a terrorist incident, so be sure to register your travels with SafeTravel as well.

Although travelling in times of uncertainty can be nerve-wracking, it can be helpful to take some perspective. Statistically speaking, the chances of being impacted by an act of terrorism abroad are minimal. However, when it comes to particularly dangerous destinations, it is worth considering your need to travel. Always take travel insurance along with you and keep an eye on current events.