Millions take a holiday from insurance

As Britain gears up for the annual holiday rush, new research shows that millions of people skip taking out travel insurance, and many of those who do are paying over the odds for peace of mind.

As Britain gears up for the annual holiday rush, new research shows that millions of people skip taking out travel insurance, and many of those who do are paying over the odds for peace of mind.

Axa, the French insurer, produced a study this week demonstrating that over 4 million people holidaying abroad this year will not take out travel insurance. This is out of a total of 34.8 million British adults, who plan between them to take a total of 68 million holidays this year. Most popular destination will be Spain, followed by Britain and the US.

Pat Brady, head of travel claims at Axa, said: "Holidays are becoming an increasingly important part of our lives. However, it's important not to get too carried away with the excitement of planning your vacation and forget to purchase insurance. In particular, with an increasing number of people taking advantage of cheap flights to the US and a weak dollar, their holiday could unfortunately end up costing more than they expected if something goes wrong and they incur any medical expenses, which tend to be financially crippling."

Axa found that the most important factor for people buying insurance is quality cover followed by price, strength of the provider's brand and convenience.

Just over four out of ten holidays will be booked through travel agents but this week Asda, the supermarket group which has recently moved into travel, said that this was the best way to suffer a rip-off.

It claimed that travel insurance from tour operators such as Lunn Poly, Thomas Cook and First Choice can cost up to three times more than the cheaper insurance providers such as Asda for similar cover. As 60 per cent of travellers buy their insurance from a travel agent, UK holidaymakers pay as much as £100 a head, or £3.5bn a year, more than they need to by not shopping around.

A £100 saving on travel insurance could buy a day pass for a family of four to Disneyland Paris, a week's car hire on the Costa del Sol, a meal for four in Tenerife - or even a last-minute week for two in Corfu.

"Travel agents' standard practice is to wait till the end of a holiday transaction and then notify the customer they need travel insurance before they proceed," said David Rutley, Asda's director of financial services.