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10 million Brits at risk abroad – are you one of them?

Are you one of the 9.9 million Brits who went abroad without the right travel insurance in the last year?* If so, you could be putting yourself and your family at risk.

Research by ABTA has revealed that 22% of holidaymakers travelled completely uninsured and 27% went without the correct cover. The second group included people who didn’t declare a pre-existing medical condition or took part in activities that they weren’t covered for. Both situations can lead insurers to reject claims and worse, leave you unprotected against dangerous situations.

There’s a huge amount that can go wrong while you’re away, a lot of it being out of your control, so getting the right travel insurance for you is crucial to making sure you’re covered and giving you peace of mind.

7 common misconceptions around travel insurance

Jon, Croydon:
“I travel to Germany often, but I travel light each time and have an EHIC, which gives me health cover if I get sick.”

EHIC doesn’t offer the cover that many people think. You’re entitled to a baseline level of cover at local amenities, but the costly parts of overseas medical emergencies– such as repatriation – are not covered.

Medical problems only make up a small percentage of travel insurance claims. EHIC doesn’t cover you for any of the situations that can cause untold grief on holiday, like lost luggage, cancellation, a bankrupt provider or robbery.

EHICs expire every 5 years, so make sure that yours is valid with enough time to renew it if it’s not.

Stacey, Norbury:
“I thought travel insurance was only for getting ill on holiday, so I never got it. Then I went to New York and the flight was five hours late, and not covered by EU law. Now, I never leave without it.”

Delayed flights aren’t the only trauma associated with flying. Luggage being sent to the wrong place, airline closures and more are all reasons you need the right travel insurance.

There are also perks you can add onto your insurance that can make delays less of a gruelling ordeal. Flight Delay Assistance gives you access to airport lounges if your flight is delayed by more than 2 hours.

Alex, Bristol:
“My bank gives me free travel insurance, so I don’t need to buy another policy when I go away.”

If your bank gives you free travel insurance, do you know what you’re covered for? Is your partner covered, or your kids?

Free insurance deals need to be scrutinised to make sure they deliver what you need. It’s too late once you’re away to realise that you’re not covered for the activity you’re doing, or that a loved one isn’t on your policy.

When you get your insurance through your bank or credit card, make sure you know exactly what you’re covered for. You might be unprotected in a way that is important to you, such as if you’re going skiing or on a cruise.

It’s always important to get the right travel insurance before going away to ensure you have the best cover.

Lottie, Ashford:
“I used to get travel insurance, but I’ve never made a claim so now I don’t bother.”

Travel insurance is about making sure you’ve got the right cover for the unexpected. No one wants to use it, but in the one situation that you really need it, you’ll be glad you have it. As the saying goes, it’s better to be safe than sorry.

Sean, Milton Keynes:
“Getting travel insurance is often so far in the back of my mind that I simply forget to buy it.”

Buying your travel insurance when you book your trip means you’re covered in the run-up to your holiday and that you don’t have a last-minute panic – or worse, forget to buy it entirely. If you buy your insurance as early as possible and then have an accident a week before you depart, you can be covered and needn’t lose out completely.

Klaudia, Totnes:
“If I’m going on a cheap holiday, I don’t want to spend extra on something I’m probably never going to use.”

The cost of cover is linked to the type of holiday you’re going on. A brief city break in the EU will be much less than a lengthy road-trip across the US for the same applicant.

Compared to the costs you might have to fork out if you lost your holiday, your ability to travel or suffered a medical emergency, the cost of travel insurance is very low.

The cheapest travel insurance options might not provide you with sufficient cover. Always make sure you’ve read the policy documents, agreed to the excess and know what you’re covered for before buying.

It is always going to be preferable to be in a situation where a payout is possible. If you don’t have a travel insurance policy, you are guaranteed not to get a payout if something should happen. This can potentially leave you thousands of pounds out of pocket.

* Kantar Forward Planning

How to avoid holiday scams

• Make sure you’re not taken for a ride while you’re abroad
• Check currency exchange rates with the Post Office Money Currency Converter

We all look forward to our holidays, unfortunately more and more people are being affected by holiday fraud and scams, which means not only could you be left without the holiday but also left out of pocket too.

You’re out and about in a new country, taking in the sights – then a friendly, well-dressed man starts speaking to you. He seems nice enough – then he explains that he’s stranded in the city, and needs a bit of cash to help him get home. What do you do?

Don’t let your guard down – chances are, he’s just after your money. Con men, taxi drivers and street vendors have all been known to scam travellers – make sure nobody takes advantage of you or your family.

We’ve put together a list of a few things to watch out for while you’re abroad. But make sure you do your own research too – guidebooks and online guides are always a great place to start.

If the worst does happen, you may need to get a police report within 24 hours to claim it against your insurance. Once that’s sorted, don’t let it spoil your holiday.

Things to consider

Before we get into specifics, here are a few tips:

• Don’t answer any personal questions from strangers
• Don’t carry a lot of cash while you’re out and about
• If something seems to be too good to be true, it probably is
• Be wary of unusually friendly strangers – especially when they suggest you go somewhere together
• Don’t let good manners get the better of you – if someone won’t leave you alone, ignore them
• Agree prices of any products, services or accommodation before you hand over any money – and always get a receipt
• Do your research before you go – find out how much things are going to cost with the Post Office Travel Barometer.
• Get a feel for the area, and learn a few key phrases in case you need to explain yourself.

Taxis and rickshaws

It’s happened to all of us at least once. Climbing into a taxi, reaching your destination in 5 minutes, and then being presented with an outrageous fare.

You don’t want to cause a fuss (because that’s not what us Brits do) so you pay the driver and fume for the rest of the night.

To avoid this happening, agree a price before you set foot in the cab. To dodge the language barrier, carry a pen and paper handy – write down the fare you’ve both agreed upon for your entire group, and then carry it with you in case of a dispute.

Don’t risk your luggage being held hostage – if you can, keep bags to hand rather than in the locked boot of a taxi.

How much to tip on holiday

• Know how much to tip when you’re abroad
• Check currency exchange rates with the Post Office Money Currency Converter

No-one enjoys under or over-tipping at a café or restaurant. Never fear – read our guide to tipping on holiday and strike the perfect balance of generous and polite, without going overboard.

Never fear – just read our guide to globetrotting tipping and strike the perfect balance of generous and polite, without going overboard.

• Europe
• Asia
• North and South America
• Africa

How much to tip in Europe

In most of Europe, tipping is very common. In many cases, it’s just built into part of the bill – very similar to the UK. Tip sizes vary from country to country, but if you get stuck or you’re strapped for cash – just add on 10%, or round the bill up to the nearest €5 or €10.

As in all countries, it’s polite to tip porters, taxi drivers and the people cleaning your hotel room – the expected tip is much smaller than the standard in bars and restaurants.

If the service has been poor, don’t hesitate to hold back on the tip. As in the UK, it’s meant to be a reward for good service.

Austria:

In restaurants, tipping is very similar to the rest of Europe. As always, keep an eye out for service charge – usually 12.5%. Pay the charge (it’s the tip) and then round the bill up to the nearest Euro. Saying ‘Danke’ (meaning thank you) when you’re paying tells the waiter to keep the change – so keep that in mind. If you’re pleased with service elsewhere, a tip is appreciated but not expected.

France:

French law requires all service charges to be included on the bill. That means tipping is much the same in the UK – a reward for good service, not an obligation. If there is no service charge, tip around 10-12.5%. Taxis, hotel staff and tour guides won’t necessarily expect a tip – but they will be appreciated.

Germany:

Tip 10%. If a service charge is included, just round the bill up to the nearest Euro. And remember – tap water isn’t free in Germany, so don’t be surprised when you see it on the bill.

Greece:

Tip 5-10%. There may be a service charge, but this will usually be a few Euros to pay for bread and water with your meal – it probably won’t go to the waiter. If you take a taxi in a tourist area, you might be expected to tip – but don’t feel pressured to  do so.

Italy:

Tip 5-10% – just round the bill up to the nearest €5 or €10. Keep an eye out for the ‘pane e coperto’ – the restaurant charging you for bread. That’s a general charge that’s different from ‘servizio’ – service charge. You’ll be expected to pay both charges, though don’t feel obligated to include a separate tip as well – especially if the charges are a bit high.

Poland:

Tip 10-15% in restaurants. Saying ‘dziękuję’ – pronounced djen-kooyeh – when you pay means you’re telling your waiter to keep the change. Tipping outside of restaurants isn’t common, or expected.

Spain:

Service charge is usually included, especially in tourist areas. However, it’s polite to add a few Euros – 5-10% on top of the bill. If there’s no service charge, pay 15%.

Turkey:

In Turkey, tip between 5-10%, depending on service. The more luxurious the restaurant, the higher the expected tip.

How much to tip in Asia

In many Asian countries, tipping isn’t especially common. If an area is popular with tourists, it’s more likely that tipping will be expected.

China

You will not be expected to tip in China. However, tourist industries – like tour bus drivers and tour guides – are very likely to expect a tip

Hong Kong

Tipping is more acceptable and commonplace than in mainland China – restaurants may add a service charge of 10-15%, and taxi drivers will usually expect to keep small change from your fare

India:

Leaving a tip of 5-10% in restaurants is fair. Outside of restaurants, tipping is usually not expected

Japan

Leaving a tip isn’t a part of Japanese culture. Good service is considered to come as standard, meaning there’s no need for a tip. Trying to tip in a restaurant may lead to staff attempting to return your money – so to avoid embarrassment, don’t tip.

Staff working for companies connected with tourism – like tour guides – may be more likely to accept a tip. In that case, it is considered polite to place the tip inside an envelope, not to hand it over directly

Thailand

In Bangkok, tipping is expected. Hotels and bars may add a service charge on to the bill – if they don’t, tip 10% or round up to the nearest 20 Baht. Leaving a tip in cash and handing your bill directly to your waiter means it’s more likely that they’ll get to keep it.

Outside Bangkok, rounding up a bill or fare will be considered a fair tip – tipping isn’t usually expected.

How much to tip in North and South America

There’s a big north/south divide in the Americas

In North America – the USA and Canada – you’re expected to tip bartenders, taxi drivers, hotel staff, tour guides and waiters, even if you weren’t especially impressed with their service.

In South America, tipping is more like Europe. It’s not usually expected outside of restaurants and hotels – so only tip if you feel that it’s justified

Argentina

Tip 10-15% at a restaurant, but watch out for the ‘cubierto’ charge – which is essentially an extra charge per person, like Italy’s ‘pane e coperto’. It doesn’t count as a tip – it goes to the restaurant, not the staff

Canada:

Like the USA, tipping is very much the norm – bartenders, taxi drivers, hotel staff, tour guides – will all expect a tip. Expect to tip between 10-15%, depending on service.

Mexico

Keep an eye out for service charge – called propina. If this is added to your bill, don’t worry about tipping more.

USA:

Tipping is always expected. Staff in every service industry will expect a tip – hotel doormen, bartenders, taxi drivers, pizza delivery drivers – the list goes on. Not tipping can easily be seen as rude. Always carry a few dollar bills, just in case.

When it comes to restaurants, tip 15-20% of the bill (before tax). When a bartender serves you a drink, leave $1 or $2. Any food delivery person that comes to your door – like pizza or Chinese – will expect 10-20%.

As for taxis – between 15-20% is acceptable. If anyone handles your bags, tip between $1-2 per bag.

As a general rule, 15-20% will never go amiss.

How much to tip in Africa

Tipping in Africa depends on where you’re visiting. Tourist hotspots almost always mean that a tip is expected. However, the further you go from major tourist locations, the less common it will be.

Kenya:

Tip 10% of the bill if you’re happy with the service at a restaurant. Tipping hotel staff at least 50-100 shillings for good service will also be appreciated.

South Africa

Leaving a tip is expected in South Africa – and in many cases will be included in the bill. Aim to leave between 10-15% in restaurants

Life insurance vs life assurance

There are big differences between life insurance and life assurance. We want you to have all the information you need to make an informed decision which is most appropriate to for you.

Life insurance and life assurance sound very similar and do very similar things, but they are very different products. They each offer unique features that will have advantages for some people and disadvantages for others. If you are considering taking out a life policy, we’ll explain the key differences between insurance and assurance so that you can assess which is better for you.

Differences between life insurance and life assurance

Assurance is designed to protect against events that will happen, whereas (in general) insurance covers you in case an event happens.

So how do life insurance and life assurance differ? When it comes to life cover, the two terms are used almost interchangeably. In fact, more common names for these products are ‘term life’ and ‘whole of life’. However much we don’t like to think about it, it is certain that we are going to die, as its name suggests, whole of life insurance (or life assurance) covers you for your entire life; there is no end date attached to the policy. So life assurance guarantees a payout on the death of a policy holder (providing premiums are maintained and the policy is valid).

Term life insurance, by contrast, specifies a length of time for your life to be insured for (otherwise known as the ‘term’ of the policy) . There will be a maximum number of years your policy can run for, meaning that the insurer only pays out if you were to die within the life of your policy.

What are the advantages of term life insurance?

It’s worth mentioning that both life insurance and life assurance share the same persuasive advantage: providing for your loved ones when you’re gone, and the peace of mind that brings.

Much will depend on your stage of life and what you intend the insurance payout to cover should you die. For a young, healthy person, term life insurance is a consideration when buying a house or starting a family.

Decreasing Cover

Decreasing cover is a form of term life insurance that stays equal to the size of your repayment mortgage. It is designed to expire at the same time your mortgage is fully repaid, and has the advantage of covering this expense if you were to die during the term of your policy. The payout amount decreases in line with your mortgage, however your premiums will remain the same throughout.

(Decreasing cover usually has an interest rate cap, meaning that if your mortgage’s interest rate is higher than your insurer’s cap, the payout might not completely cover your outstanding repayments.)

Level Cover

Level cover offers a payout of a specific amount. If you have calculated your family’s cost of living and know what they would need to continue life as they know it without your input, then level cover can provide peace of mind that they will not need to undergo dramatic upheaval should you die.

Increasing Cover

Increasing cover has the same basic principle as level cover, however it is index-linked and so rises with inflation. Indexes track the relative costs of goods and services to chart the changing buying power of a currency (‘inflation’). Money tends to be worth less over time (think about the cost of a chocolate bar ten years ago compared to now), and so increasing cover uses the interest rate to increase your payout size to give you the same relative value as when you took out your policy.

Increasing cover will also mean periodically increased premiums with most insurers.

While everything depends on a person’s unique circumstances, it is generally the case that for the same value of payout, decreasing term policies pay the lowest premiums and increasing term pay the highest.

What are the advantages of life assurance (whole of life insurance)?

It might seem at first that, given the main difference between life insurance and life assurance, the latter is more tempting. Since the policy does not expire, there is no risk of you dying after the end of your contract and not receiving a payout. Yet due to this, premiums for lengthy life assurance policies (or those with large payouts) tend to be significantly greater than those of term life policies.

Policies designed for people entering later life (usually entitled things like “over 50s life insurance”) are usually whole life policies that payout regardless of how long you live after you have taken out the cover.

Most often, this type of policy is used to contribute towards funeral expenses, pay outstanding debts or leave as a gift to family. Payouts are too small to contribute meaningfully to a mortgage, but some have the benefit of having a fixed length with respect to your contributions. Post Office Over 50s Life Insurance, for example, enables you to stop paying your premiums after 30 years, or on your 90th birthday (or subsequent policy anniversary; whichever is soonest).

Your cover is still in place and will remain so until you die, but the premiums no longer need to be paid.

Which is right for me?

Whether to choose life insurance or life assurance needn’t be as confusing as their names might imply. With the above information and based on your stage in life and plans for the future, we hope that you’ll be able to make a choice between insurance and assurance that is right for you. Post Office offers serveral life insurance options that might be right for you, if you’d like to discuss your options with an advisor in more detail, contact our team on 0330 123 3947.