The UK’s Underinsurance Problem

Despite frequent warnings from consumer groups and insurers, millions of British travellers still head abroad without adequate protection. A 2024 survey by Forbes Advisor UK found that 42% of UK holidaymakers admit they don’t purchase travel insurance at all, and a further 27% travel with cover that’s likely to be unsuitable for their trip — whether because of low policy limits, undeclared medical conditions, or exclusions for common activities (Lift Financial, 2024).

This trend is particularly concerning given the increasing complexity of modern travel. From multi-leg itineraries and boutique accommodation bookings to active holidays and wellness retreats, travel in 2025 often involves high-value components that are difficult — or impossible — to recover without appropriate cover.

Compounding the issue is a lack of understanding about what insurance actually provides. A separate investigation by Which? (2024) revealed that 16% of UK travellers who made a claim had it either rejected entirely or only partially paid out. The most common reasons? Not disclosing pre-existing medical conditions, misunderstanding what’s included in the policy, or failing to realise that certain destinations or activities required specific add-ons.

For insurers, the cost of these mistakes is rising. According to the Association of British Insurers (ABI), UK travel insurers paid out £352 million in claims during 2022, covering over 362,000 incidents — including medical emergencies, cancellations, lost baggage, and travel disruption (ABI, 2023). That equates to an average claim value of £973, though medical-related payouts can be significantly higher, especially when involving hospitalisation or air evacuation.

These figures aren’t just financial data — they represent tens of thousands of cases where travellers experienced real disruption, distress, or serious loss. And yet, without the right insurance in place, many are left to manage the financial consequences on their own.

Real-Life Consequences of Inadequate Coverage

Travel insurance isn’t just about protecting your suitcase or covering a delayed flight — it’s about safeguarding your wellbeing, your family, and your ability to recover from unforeseen events abroad.

Take the case of a British skier in Switzerland. While enjoying an off-piste run, they suffered a severe leg fracture. Unfortunately, their insurance policy didn’t cover skiing outside marked trails — an activity they hadn’t disclosed. The result? Their claim was rejected in full, and they were left to shoulder over £27,000 in medical and mountain rescue fees (The Local Switzerland, 2025). It’s a harsh reminder that assuming coverage is in place — without checking the fine print — can lead to financially devastating consequences.

In another case, a UK teenager was hospitalised following a beach accident in Spain. Her family hadn’t arranged travel insurance for the trip, believing it wasn’t necessary for a short European holiday. When faced with the need to medically repatriate her to the UK, they were quoted over £30,000 for an air ambulance, with no insurer to absorb the cost (Sky News, 2024). For many families, this kind of sudden bill can be financially ruinous.

Then there’s the everyday chaos that can still lead to costly outcomes — like the baggage meltdown at Heathrow in 2022. Thousands of bags were delayed or lost, with many travellers scrambling to replace essentials at their destination. Most were shocked to learn that standard travel insurance policies often cap single-item reimbursements at just £250–£400, meaning laptops, designer luggage, or jewellery were vastly underinsured (The Guardian, 2022). Worse still, compensation under aviation law is similarly limited, offering little recourse without a robust travel policy.

In one of the most extreme documented cases, a Direct Line customer involved in a serious road accident while travelling in the United States required extensive medical treatment and specialist evacuation. The final bill? An eye-watering £587,000, all covered by their insurer (The Independent, 2019). This case, while exceptional, is a stark illustration of just how expensive medical care abroad can be — and how quickly the costs can escalate without warning.

These stories vary in severity, but the takeaway is consistent: when things go wrong abroad, the financial implications can be severe, and insurance is often the only safety net. Whether it’s a common delay or a life-threatening emergency, a comprehensive policy can make the difference between manageable disruption and life-altering expense.

Why Insurance Companies Are Tougher Than Ever

The post-pandemic travel landscape has shifted significantly — and insurers have adapted in response. With a sharp rise in complex itineraries, luxury add-ons, and high-value claims, insurance providers are now applying far greater scrutiny to both applications and claims. For British travellers, that means the fine print matters more than ever.

Medical Disclosures Are Now Under the Microscope

One of the most common reasons for claim rejection in the UK is failure to disclose pre-existing medical conditions. What some travellers see as a minor or historic issue — like controlled high blood pressure, a brief consultation for anxiety, or a follow-up scan — can result in the full invalidation of a claim if not declared at the time of policy purchase.

As MoneySavingExpert (2024) highlights, even a GP appointment for a routine check-up can become relevant during a claim assessment, particularly if it results in a prescription or is recorded in your medical history. Insurers now have access to increasingly detailed medical databases and may request permission to contact your GP. If the information on your policy doesn’t match your medical record, your claim could be declined — even if the issue is unrelated to the reason you’re claiming.

Documentation Is Essential

It’s no longer enough to simply “know” what was lost or damaged — travel insurers now require formal proof as standard. According to the Association of British Insurers (ABI, 2024), most providers will request:

• Police reports for theft or loss
• Hospital admission and discharge notes for medical claims
• Original, itemised receipts for high-value possessions
• Flight confirmation and baggage delay reports for missed or lost luggage

Without this documentation, claims are likely to be delayed — or denied outright. This is particularly important for those travelling with designer luggage, expensive electronics, or jewellery, which often exceed standard single-item payout limits.

Activities Are Not Automatically Covered

Many travellers assume that all holiday-related activities are included under standard insurance — but that’s no longer the case. A growing list of adventure and sports-related activities are excluded unless declared and explicitly covered, including:

• Skiing (particularly off-piste or heli-skiing)
• Scuba diving beyond a certain depth
• Jet skiing and water sports
• Quad biking, zip-lining, and even some guided hikes

The Local Switzerland (2025) reports that off-piste skiing is one of the most commonly misunderstood exclusions, with multiple claims denied every season due to the traveller’s assumption that all snow sports are covered.

To avoid disappointment — or a five-figure medical bill — it’s essential to review your itinerary against your policy terms. If there’s even a chance you’ll be participating in high-risk or physical activities, it’s worth calling your insurer to confirm coverage or upgrade your policy.

Common Exclusions to Watch

Exclusion	Impact
Pre-existing conditions	Can void a claim if undeclared
Alcohol-related injuries	Usually excluded from cover
High-value single items	Often limited to £250–£400 unless declared and itemised
Adventure sports	Not covered unless added to the policy
COVID-19 cancellations	Only covered if specified in the policy (Post Office, 2025)

How to Get the Right Travel Insurance: Five Steps That Matter

Getting insured isn’t just about checking a box — it’s about ensuring your policy genuinely protects your plans. Whether you’re booking a boutique city break or an extended sabbatical abroad, these five actions will help you secure meaningful coverage that works when it matters most.

1. Buy Insurance at the Time of Booking

Don’t wait until the week before departure — or worse, the airport check-in queue. Purchasing travel insurance at the point of booking activates your cancellation cover immediately, which means you’re protected if an unexpected illness, redundancy, family emergency, or even jury service forces you to cancel before your trip begins.

Early cover is particularly important if you’re paying large deposits on non-refundable flights, villas, or private tours — all common with bespoke or luxury travel.

2. Disclose Everything — Fully and Honestly

Travel insurers are now more rigorous than ever when it comes to medical and activity declarations. That means every known or previously diagnosed medical condition must be disclosed, even if it’s well-managed or hasn’t required recent treatment. Failing to do so is one of the most common reasons for claims being denied.

It’s also vital to list all destinations, stopovers, and connecting countries. For instance, if you’re stopping briefly in the US en route to the Caribbean, but haven’t declared it, your policy may not be valid for that portion of the journey. Similarly, if your trip includes adventure activities — from scuba diving and skiing to hiking or sailing — make sure these are included in your policy.

3. Match Your Cover to the Value of Your Trip

Not all trips are equal — and your insurance shouldn’t be either. A luxury holiday or long-haul multi-stop escape demands higher cover limits to reflect the actual financial risk.

As a general guide for comprehensive protection:

• £10 million for medical expenses and repatriation (especially outside Europe)
• £5,000–£10,000 for trip cancellation cover — enough to recoup what you’ve prepaid
• £2,000+ for baggage, with flexible single-item limits to accommodate higher-value items like designer luggage, tech, or jewellery

If you’re travelling with valuable belongings, consider insuring them separately or increasing your policy’s single-item limit.

4. Add Disruption Cover — Especially for Tailored Itineraries

Standard policies may not go far enough when it comes to trip flexibility or unforeseen changes. Add-ons like “Cancel for Any Reason” (CFAR) or “Travel Disruption Cover” can offer peace of mind, particularly if you’re booking:

• Private villas or yacht charters
• Multi-country itineraries with tight transfers
• Remote or off-grid properties
• Travel around weather-prone destinations

These options can allow partial reimbursement even if your reason for cancelling isn’t one of the standard “named perils” — useful for travellers who value flexibility.

5. Keep Records and Receipts Digitally

One of the fastest ways to get a claim paid is to have clear documentation — and the best way to keep it safe is to store it in the cloud. This includes:

• Boarding passes
• Flight confirmations and hotel invoices
• Medical notes and prescriptions
• Police reports (in cases of theft or loss)
• Itemised receipts for any valuables you’re travelling with

Create a secure digital folder (e.g. in Google Drive or Dropbox) before your trip and upload scans or photos of each key document. In the event of a claim, you’ll have everything ready — no rummaging through bags or waiting on replacement paperwork.

These steps may seem small, but they form the backbone of effective travel insurance. With just a little extra diligence upfront, you’ll ensure that your cover works when you need it — so that even the unexpected can be handled with minimal stress, and you can focus on enjoying the journey.

Final Thoughts

Travel is about peace of mind, but that doesn’t mean you should leave things to chance. The right travel insurance isn’t just a backup — it’s a necessity. With stricter claim conditions and ever-higher costs abroad, comprehensive coverage is the one non-negotiable item on any packing list.

References

Association of British Insurers (2023) Pack your travel insurance this summer. Available at: www.abi.org.uk (Accessed: 8 May 2025).
Association of British Insurers (2024) Safe travels: remember the Travellers Ten. Available at: www.abi.org.uk (Accessed: 8 May 2025).
Forbes Advisor UK (2024) Travel Insurance Survey. Quoted in: Lift Financial. Available at: www.lift-financial.com(Accessed: 8 May 2025).
MoneySavingExpert (2024) Travel Insurance Guide. Available at: www.moneysavingexpert.com (Accessed: 8 May 2025).
Post Office (2025) Travel Insurance – COVID-19 Cover. Available at: www.postoffice.co.uk (Accessed: 8 May 2025).
Sky News (2024) ‘British girl faces huge hospital bill after holiday accident’. Available at: news.sky.com (Accessed: 8 May 2025).
The Guardian (2022) ‘Global lost luggage crisis mounts’. Available at: www.theguardian.com (Accessed: 8 May 2025).
The Independent (2019) ‘One travel-insurance claim made every minute’. Available at: www.independent.co.uk(Accessed: 8 May 2025).
The Local Switzerland (2025) ‘Will your insurance pay if you ski off-piste?’. Available at: www.thelocal.ch (Accessed: 8 May 2025).
Which? (2024) Why travel insurance claims go wrong. Available at: www.which.co.uk (Accessed: 8 May 2025).