Wondering if domestic travel insurance is worth it? Learn what domestic travel insurance in Australia covers, including cancellations, delays and lost luggage.
Travel Insurance
Travel insurance vs credit card insurance: what's the difference?
Compare travel insurance and complimentary credit card insurance. Learn the key differences, limitations, and why standalone travel insurance may offer greater peace of mind.
Complimentary credit card travel insurance shouldn't automatically be considered a replacement for standalone travel insurance. Eligibility rules, benefit limits and exclusions vary widely between cards, and many travellers don't realise they may not be covered until they need to make a claim.
Before your next holiday, consider whether standalone travel insurance better suits your destination, activities and travel plans. Knowing the differences before you travel can help you choose the protection that's right for your trip.
Having the right cover before you leave home can provide valuable peace of mind, so you can focus on enjoying your trip.
What is complimentary credit card travel insurance?
Complimentary credit card travel insurance is a benefit included with some premium credit cards. Rather than purchasing a separate policy, eligible cardholders may receive travel insurance if they meet the card issuer's activation requirements.
These requirements often include:
- paying for flights or a minimum amount of travel expenses using the eligible credit card
- being the primary cardholder (and sometimes additional cardholders)
- travelling within specified age limits
- meeting residency requirements
- satisfying the insurer's terms and conditions.
Some complimentary travel insurance also requires you to have your departure and return travel booked and/or confirmed before cover starts.
Because every credit card is different, it’s important to read the Product Disclosure Statement (PDS) for your complimentary travel insurance before assuming you’re covered.
How is standalone travel insurance different?
Standalone travel insurance is a policy you purchase specifically for your trip. It generally offers broader protection and allows you to choose the level of cover that best suits your destination, activities and budget.
Unlike complimentary credit card insurance, standalone travel insurance doesn't depend on meeting spending thresholds or activation requirements. Once you've purchased the policy and meet its terms and conditions, you'll know exactly what you're covered for.
Many policies also allow you to customise your cover with optional extras, such as cover for snow sports or cruises.
Carefully compare travel insurance options before your trip to get the right level of cover for you.
Key differences between travel insurance and credit card insurance
Although both types of insurance aim to protect travellers, there are some important differences.
Eligibility requirements
One of the biggest differences is how cover starts.
With complimentary credit card insurance, you'll usually need to meet specific conditions before cover applies. This may include purchasing return flights, paying a minimum percentage of travel costs using the card, or activating your cover. You may also have to manually activate your complimentary travel insurance before its cover starts.
Standalone travel insurance doesn't rely on how you paid for your trip. Once you've purchased your policy and it takes effect, according to its terms, your cover is generally in place.
Medical cover
Medical expenses overseas can quickly become expensive, particularly in countries where healthcare costs are high.
While some complimentary credit card policies include overseas medical cover, the limits, exclusions and conditions vary considerably between providers.
A standalone travel insurance policy is often designed with overseas medical emergencies as a core benefit, helping cover eligible hospital treatment, emergency medical evacuation and related expenses, subject to the policy terms, conditions, limits and exclusions.
More: How travel insurance protects you in medical emergencies while overseas
Cancellation and travel disruption
Unexpected events such as illness, severe weather or family emergencies may force you to cancel or change your trip.
Standalone travel insurance policies may provide broader cancellation benefits than complimentary credit card insurance, although cover depends on the reason for cancellation and the policy terms.
Credit card insurance may have lower benefit limits or narrower definitions of covered events.
More: What to do if your flight is cancelled or delayed
Luggage and personal belongings
Lost, stolen or damaged luggage can quickly disrupt a holiday.
While both standalone travel insurance and complimentary credit card insurance may include luggage benefits, standalone policies often provide greater flexibility, higher benefit limits or cover for a wider range of belongings.
Always check item limits, depreciation rules and exclusions before travelling.
More: What to do if your luggage is lost, delayed or damaged
Optional cover for different trips
Not every holiday is the same. If you're planning a cruise, snow sports holiday or adventure activities, you may need specialised cover that isn't included automatically.
Standalone travel insurance often allows you to purchase optional cover that suits your travel plans, whereas complimentary credit card insurance may not cover certain activities at all.
Excess differences
Complimentary travel insurance may include a excess that cannot be removed or changed. On the other hand, standalone travel insurance may give you options to choose your preferred excess amount.
Cover for luggage and flights can be very important. Image: Getty
Why reading the Product Disclosure Statement matters
Whether you're relying on complimentary credit card insurance or purchasing travel insurance, always read the Product Disclosure Statement (PDS).
The PDS explains:
- what's covered
- what's excluded
- benefit limits
- excess amounts
- eligibility requirements
- how to make a claim
- whether there are exclusions for pre-existing medical conditions, high-value items or specific destinations.
Understanding your cover before you travel can help prevent unexpected surprises if you need to make a claim.
When standalone travel insurance may be the better choice
Complimentary credit card insurance can be suitable for some travellers, but make sure you understand exactly what it covers and how that cover is triggered.
You may prefer the certainty and flexibility of a dedicated travel insurance policy.
Standalone travel insurance may be worth considering if you are:
- travelling with children or as a family
- taking an extended overseas holiday
- visiting multiple countries
- planning a cruise or ski holiday
- carrying expensive luggage or electronics
- wanting higher levels of cancellation cover
- looking for optional extras tailored to your trip.
Having a policy that's designed specifically for travel can provide greater confidence that your cover matches your itinerary.
Travel insurance can help provide peace of mind, so you can focus on enjoying your holiday. Image: Getty
Why choose RACV Travel Insurance?
Travel should be about making memories - not worrying about what could go wrong. Complimentary credit card travel insurance may have very different rules to standalone travel insurance, as outlined above. Make your choice based on what best suits your needs.
If you prefer a standalone travel insurance policy, RACV Travel Insurance offers a range of policies designed for different types of travellers, whether you're heading overseas, taking a domestic holiday or planning multiple trips throughout the year.
*RACV Member discount applies to the premium only (not applicable taxes).
Royal Automobile Club of Victoria (RACV) Limited (ABN 44 004 060 833, AR No. 1243563) (RACV) is an authorised representative of the RACV Travel Insurance insurer Tokio Marine & Nichido Fire Insurance Co., Ltd. (ABN 80 000 438 291 AFSL 246 548) (Tokio Marine). Tokio Marine Management (Australasia) Pty Ltd (ABN 69 001 488 455, AR No. 1313066) is an authorised representative of Tokio Marine, and administers RACV Travel Insurance as the managing agent on behalf of Tokio Marine.
Terms, conditions (including eligibility criteria), exclusions, limits and sub-limits apply. Any advice is general advice only, and does not take into account your specific objectives, financial situation or needs. Before you purchase, please consider the Combined Product Disclosure Statement (PDS) / Financial Services Guide (FSG) and Target Market Determinations (TMDs) available on RACV’s website, or on request from RACV.
