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Annual travel insurance isn’t always the best bet

Opting for single-trip policies can save you money
Travel insurance

New Which? research has found that it can be cheaper to buy three single-trip travel insurance policies instead of an annual one, depending on where you’re going.

Which? found an example of a single-trip travel insurance policy to the USA costing £400, more than an annual policy covering the same holiday. 

And with more than a third of travel insurance companies, it is cheaper to buy as many as three separate policies to cover European trips rather than an annual policy.

Single-trip cover for Europe can be cheaper

Based on the most popular destinations for European holidays, we gathered quotes for a 60-year-old buying three single-trip policies to Europe (four days in France, seven days in Italy and 15 days in Spain). We also obtained a quote for an annual European policy, covering all trips.

Out of the 69 insurers we analysed, we found that 37% worked out to be cheaper if you bought three single-trip policies to Europe, rather than an equivalent annual multi-trip policy from the same provider.

The two insurers which stood out as being most expensive for European annual cover were Topnotchcover and Insurewithease – costing £120.58 and £108.93 respectively. But buying three single-trip policies with these providers for the holidays listed above would cost just £81.63 and £75.69 respectively.

What do the insurers say?

When we queried this with Topnotchcover, it said: ‘There’s a current price anomaly with our Gold annual multi-trip policy for those over the age of 55 years. We hope to have the matter resolved in the not-too-distant future’.  

Insurewithease told us: ‘The older the client (e.g. retired), the more likely they are to take multiple trips in a year, as they are not restricted by their working holiday allowance. Therefore, annual multi-trip policies are more expensive for the elderly.’

Different for worldwide policies

It’s a different story when it comes to buying worldwide cover to include the USA and Canada – where medical bills can be high.

Almost a third of the 67 insurance providers we looked at charge more for one worldwide single-trip policy lasting 24 days, than they do for a worldwide annual policy.

This is surprising, as the maximum length of a trip allowed on an annual policy is typically 31 days. And in some cases, we found extreme differences in the cost of buying an annual worldwide policy versus a 24-day single-trip worldwide policy.

For example, OUL Direct charges £82.15 for its Gold annual worldwide policy (including USA) for a 60-year-old. But the premium for a 24-day worldwide single-trip policy (including USA) for a 60-year old is a staggering £482.95 – a difference of £400.80.

OUL Direct told us ‘We have found that the risk of insuring clients on our single-trip policies is much higher than the risk of insuring someone of the same demographic on an annual multi-trip policy.’

Finding the best travel insurance option

By working out what type of cover you need in advance, you should be able to calculate whether an annual or single-trip policy would be best for you. To do this, you need to add up the number of times you plan to go away during a year, and which countries you plan to visit – whether it’s Europe, the USA or the rest of the world.

Your age will also be a key factor when deciding which type of policy to go for, so it’s definitely worth getting quotes from a few providers (for both single-trip and annual multi-trip options) to see if you can save money on your cover. Our travel insurance Best Rate tables will help you secure a decent premium rate.

More on this…

  • Travel insurance Best Rates – we help you find a competitively-priced policy
  • Which? Recommended travel insurance Providers – the companies we rate
  • Cover if you’ve got medical conditions – best rates if you’ve had medical issues
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