Is Multi-Trip Travel Insurance Really the Cheapest Option?

**Collaborative post**

A lot of people will be looking for ways to save money on their holidays this year. With the steep cost of living rises starting to bite, the idea of splurging on a holiday in a big way doesn’t feel so appealing right now. Even if you haven’t been on a proper holiday for the duration of the COVID-19 pandemic.

There are lots of tried and tested ways of holidaying on the budget. But one thing you shouldn’t be tempted to do is cut out essentials like travel insurance. Before COVID-19 struck, as many as one in five Brits owned up to going abroad without travel insurance.

That’s a big risk. Fall ill or have an accident while in another country, and medical costs can be astronomical. Without travel insurance, a hospital stay could cost you 12 times as much as a stay in a five star hotel. 

During the course of the pandemic, as people adjusted to the risk of having their holiday plans cancelled last minute because of a positive COVID test, the percentage of travellers not taking out insurance dropped dramatically. People saw the sense in protecting themselves from financial losses should something go wrong.

That’s a good habit to stick with, even if you are trying to save money where you can.

Besides, travel insurance need not even be all that expensive. Prior to the pandemic, the average cost of a policy was just £38. Prices have gone up since, largely due to insurers having to pay out on all those COVID cancellation claims. And what you have to pay can vary considerably depending on where you travel to, the length of your stay, your age and whether you have any medical conditions or not. 

But in general terms, there are ways and means to protect yourself with travel insurance without busting your budget. One of the money-saving tips bandied around most often is to buy annual travel insurance, rather than cover for just a single trip. But how does that work, and will it really save you money?

What is annual travel insurance?

Annual travel insurance, also known as multi-trip travel insurance, covers you for a full 12-month period. This is different to the standard model of buying travel insurance, also known as single trip insurance. When you buy one of these policies, you are asked to provide your departure date and the date you return. These are the dates your cover is valid for.

The reason why annual travel insurance is also known as multi-trip insurance is that you can go on several different trips within that 12-month period and still be covered. Details vary from provider to provider, but there may be a limit on how many different trips you can go on or a maximum number of days you can be away for.

You also need to choose your regions accordingly. European annual insurance, for example, will only cover you for trips to Europe. If you expect to be heading elsewhere, you would need worldwide cover. 

Is multi-trip insurance cheaper?

The first thing to say about multi-trip travel policies is that side by side, they cost more than single-trip policies. But in a lot of cases, not a lot more. You will often find annual cover works out cheaper even if you only go away twice a year. And the more you travel, the more you save. 

Inevitably, there are exceptions. Research by Which? found no instances of multi-trip policies being more expensive than three single-trip policies to an equivalent destination. So if you regularly go away three or more times a year, you can be pretty sure annual cover will save you money.

However, it did find examples where buying two single trip policies worked out cheaper than annual insurance if you only go away twice in a year. These included the cost of cover for a two-week trip to Spain and a two-week trip to France in the same year.

It also found evidence that older travellers don’t get as good value from multi-trip policies, for shorter breaks especially. In one standout example, it found that a 70-year-old would have to take six-weekend breaks to Europe to make annual insurance cheaper than buying cover for each trip separately.

On the flip side, there are some rare examples where annual policies can be cheaper than single trip cover outright. This is most likely on long-haul trips, especially to destinations like the US and the rest of North America that are generally more expensive to get insurance for anyway. According to the study by Which?, a 70-year-old could save £45 buying an annual policy for the US compared to the cost of single trip insurance for a two-week holiday.

So as a general rule, multi-trip travel insurance tends to work out as the cheapest way to buy travel insurance as long as you plan to go away at least twice. And preferably more. But because there are so many different factors that influence the cost of travel insurance, the only way to be sure is to compare prices yourself.