What is Travel Insurance?

Compare with Savvy and find out more about what travel insurance is today.

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, updated on September 4th, 2023       

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Compare Travel Insurance Quotes in 30 Seconds

Even the most well-planned overseas or domestic holidays can hit some turbulence. If cancellations, disruptions or medical woes beset your getaway, travel insurance has your back – and Savvy can help you find the best policy.

You can take the guesswork out of your holiday homework by comparing your options with us. You can learn how travel insurance works, what is and isn't normally covered and how much you should expect to pay. Save time and money and compare with Savvy today.

What is travel insurance?

Travel insurance is a type of indemnity which covers you for any emergencies or unexpected costs while you’re on a domestic or international holiday. Some of the costs you are covered for include medical treatment, lost or stolen bags and delays or interruptions to your bookings, such as flight hold-ups.

There’s no ‘one size fits all’ when it comes to travel insurance, with the level of coverage depending on your preference and the trip you have planned. The cost of your policy will largely come down to factors such as the length of your holiday, where you are travelling, your age and whether you have any pre-existing medical conditions. You also have a range of choices when it comes to the type of travel insurance, with single-trip, annual, seniors’, cruise and one-way policies available.

If you gamble and don’t buy travel insurance for your next getaway, you could be leaving yourself open to forking out huge out-of-pocket costs if something goes wrong while you’re overseas. For example, if you require treatment from a hospital in a country without universal healthcare, you could be left to foot a bill into the tens of thousands of dollars, if not more.

What does travel insurance cover?

One of the perks of taking out travel insurance is the peace of mind it can give you while you’re on a domestic or international holiday. You’re safe with the knowledge that when the unexpected happens, your travel insurance covers you for a range of incidentals.

Most comprehensive travel insurance policies will offer you the following benefits:

  1. Overseas medical or hospital expenses: overseas medical bills can reach into the thousands of dollars, so having travel insurance coverage will save you a stack of cash if you find yourself with an injury or struck down by an illness. If you’re travelling within Australia, any healthcare costs are covered by Medicare or your private health insurer.
  2. Evacuation: if you become gravely ill and your insurance company’s team of doctors determine you need to come back to Australia, they’ll cover the cost of evacuation and repatriation. This includes if you need to abandon ship if you’re sailing the high seas on a cruise, which could cost you anywhere from $50, 000 to charter an air ambulance if you don’t have insurance.
  3. Cancellation: while you hope you won’t have to use it, many travel insurance providers will allow you to get back any pre-paid deposits on hotels, flights or tours if you need to call off your holiday due to a covered event. Valid reasons for cancelling include being too sick or injured to travel or a family member becoming unwell or dying.
  4. Lost or damaged luggage: it can be stressful if you’re waiting at the baggage carousel and your luggage doesn’t turn up. It can also be a nightmare if it turns up at your destination damaged or broken. Most insurance companies will reimburse or replace your luggage if it’s lost, stolen or damaged up to an agreed claim limit, which is usually about $15, 000.
  5. Personal items: taking your mobile phone or laptop with you on holiday? Most insurance policies have sub-limits that allow you to claim for lost, damaged or stolen items. For example, some may allow you to claim up to $1, 500 for damage to your mobile phone while you’re on holiday.
  6. Pre-existing conditions: most travel insurance providers include a list of 30 to 40 pre-existing conditions which are automatically included in your coverage. These usually include certain types of diabetes, asthma (for those under 60) and osteoporosis. If you suffer a more serious condition or recently had an operation, however, you will likely have to pay a higher premium.
  7. Delay: most travel insurers will allow you to claim for accommodation, food and some essentials if your flight is delayed by more than 24 hours. This also includes if your bags are delayed due to an interruption to your scheduled plane.
  8. Personal liability: being embroiled in legal woes overseas can result in hefty costs. If you’re found personally liable for damage or injury to another person, your insurance provider can typically cover related costs to the tune of up to $5 million.
  9. Accidental death: if you die overseas due to a covered accident, your insurance company can organise the repatriation of your body at their expense. They can also pay for any funeral or cremation expenses, usually up to about $25, 000.
  10. Optional extras: doing a spot of rock climbing or scuba diving on your holiday? Most travel insurance policies won’t cover these activities under their standard policies, but will instead offer you extra cover to give you protection.

What does travel insurance not cover?

While travel insurance can offer you ample benefits, there are some areas where you’re not covered. It's important to read the PDS on your policy so you’re across these, as it will save you making claims for incidentals not included under your policy. Some of the areas you won’t be covered include:

  1. Losing your belongings if they’re left unattended
  2. Claiming against an unapproved pre-existing medical condition
  3. Accidents due to alcohol or drug-related activity
  4. Travelling against government or medical advice
  5. Breaking the law
  6. Wanting to cancel your trip because you had a change of heart

What are the different types of travel insurance?

Most providers offer travel insurance policies to suit a wide range of travellers, whether you’re a frequent flyer or a once-a-year sort of person. When you’re comparing with Savvy, take a look at the different types of policies on offer and find one that suits you to a tee.


Tailored to backpackers or those travelling on a budget, basic policies cover you for the bare essentials, such as medical expenses while you’re in an overseas country and personal liability. These policies are generally considerably cheaper than comprehensive options and can come with the option of adding cover for your luggage and personal effects.


This is essentially the top-of-the-line coverage and affords you plenty of benefits, from cancellation and delay cover to loss of your bags while you’re jet setting across the country or the globe. These policies are generally pricier than their basic counterparts, but make up for it with much more coverage offered.


Taking a drive to Broome or catching a cruise up the Whitsundays? Domestic travel insurance policies offer you protection while you’re holidaying in your own backyard. Remember, domestic travel insurance is still important if you’re cruising in Australian waters, as many ships don’t have Medicare-accessible doctors onboard.


Flying to Mexico to embrace the festivals and fiestas? You can purchase international travel insurance policies which cover you while you’re holidaying overseas. Remember to pay attention to any travel warnings before you leave, as most insurers won’t cover you for travel to a country that the government has advised caution against holidaying in.


Most travel insurers offer single-trip policies for those who holiday less frequently. These travel insurance policies can be bought at any time and are effective for up to 12 months from the moment you jump aboard a plane, train or automobile for your holiday.


Multi-trip travel insurance policies are targeted at those taking more than one holiday per year. These policies cover you for anywhere between 15 and 90 travel days across a 12-month period. These policies, also referred to as annual travel insurance, can be cheaper alternatives to taking out individual policies for every journey you take.


Heading overseas to live or study and don’t have a return ticket booked? You can purchase one-way travel insurance, which covers you if you’re only taking a departing flight from Australia to your destination.

How should I compare travel insurance policies?

More common travel insurance questions

How do I get a travel insurance quote?

Getting a quote on your travel insurance is a relatively simple process which should take only a few minutes. Once you’re on an insurance company’s website, you can normally submit the following information to get a price on a policy:

  • Your destination
  • The anticipated length of your trip
  • Your age
  • Whether you have any pre-existing conditions
  • If you’ve been vaccinated for COVID-19
  • Whether you need added extras such as winter sport cover


You’ll get a quote for basic and comprehensive policy options, and if one catches your eye, you can purchase it fairly easily there and then.

Does travel insurance cover COVID-19-related costs?

The pandemic has changed the way many of us travel and many insurers have included coverage for COVID-19-related costs in their policies. While most basic policies will cover you for medical treatment if you test positive, you’ll have to take out top-level cover to get cancellation protection due to catching COVID-19 or becoming a close contact. 

What’s involved with making a claim on my travel insurance?

Whether you’re overseas or just away from home roaming a remote part of Australia, you can make a claim over the phone or via your insurer’s portal. In many ways, it’s better to file your claim as soon as possible so the details are fresh in your mind. To make a claim, you must:

  • Enter your policy number and attached email
  • Complete the claim form with ample details
  • Attach any relevant documents such as medical or police reports
  • Submit your claim


Most insurance companies will tell you it can take up to ten working days to get a response on your claim. It’s a good idea to respond quickly to any requests for clarification to avoid hampering the process.

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We do not compare all travel insurance brands currently operating in the market. Any advice presented above or on other pages is general in nature and does not consider your personal or business objectives, needs or finances. It’s always important to consider whether advice is suitable for you before purchasing an insurance policy.

Savvy earns a commission from our partners each time a customer buys a travel insurance policy via our website. We don’t arrange for products to be purchased from these brands directly, as all purchases are conducted via their websites.

Before purchasing your policy, we recommend you refer to the provider’s PDS for any further information on the terms, inclusions and exclusions.