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Financial institutions today offer many extra's to entice customers to apply for their credit cards and/or charge cards; one of the extras commonly offered is free travel insurance. This extra can lead to confusion for many potential travelers. Although some high end cards such as Platinum and Gold Cards offer reasonable cover many of the standard cards have very restricted insurance and therefore should not replace standard travel insurance.

Listed below are some of the common pitfalls:

- Possible restrictions on medical coverage

It is important to check that the medical coverage is adequate for the destination that you are traveling too. For example, it is recommended that travelers have unlimited medical cover for US travel as medical expenses can be massive.

- Possible restrictions on coverage

E.g Some cards only offer 'travel inconvenience which occurs in the case of flight delay, missed connections and delayed or lost luggage or for 'travel accident insurance for example loss of life or limb in an accident during transport such as a flight but not during the trip.

- Your travel insurance my be void if you pay for your trip with cash

E.g This is very important to check as the Insurance Ombudsman Service in Australia recently saw a claim refused because the consumer paid for the trip deposit in cash and not with their card.

- Most policies have an excess that needs to be paid if you make a claim.

- No option to pay a slightly higher premium to 'buy-out' the excess as with normal travel insurance.

- Pre-existing medical conditions are covered only if the customer specifically applies to the insurer and they approve.

- Pre-existing medical conditions may only cover the main cardholder and may not be available for your spouse or children.

As shown by these pitfalls not all travel insurance will be adequate for your trip. It is therefore important to understand the conditions and restrictions found in the product disclosure statement before you travel. It is essential for you to check all the small print on your policy before you make a decision. So even though travel insurance may be a 'free' extra the consequences of not being properly covered will cost you in the long run.

Australia Travel Insurance wishes you a wonderful and safe journey.