Holiday insurance quote cheaper for multi trip annual than single trip? Why?

usignuolo

OH and I are planning a trip to New York later this month for a flying visit (one week) to see the grandchildren. I went on line for a travel insurance quote - from Leisure Guard and got one for a single trip - I had to give the exact dates.

Then I thought I would see how much dearer it would be for an annual multi trip policy, still with Leisure Guard, given we might be back there in the spring. It was 25% cheaper!

The multi trip policy said it was valid for total of 31 days in any calendar year but did not ask us to state which dates we would be travelling. Also as OH and I are not getting any younger, I was surprised that no pre-existing health conditions were specified although fortunately we do not have any.

So why is an annual multi trip policy cheaper than a single trip one? I have checked very carefully and I have provided the same facts for both quotes.

michele-p

Hi, does the multi trip quote definitely include America? It's often more expensive as it puts it up to worldwide cover. If it does, good find!

daveyjp

You need to check the small print for both policies word for word. Annual cover can be lacking in important areas.

danandjens_worldtravels

Just a guess but maybe you are viewed as less of a risk on annual cover because you travel more and are therefore less likely to miss the flight, get ill, lose possessions?

As I say this, it doesn't seem to make sense but perhaps its counter intuitive like fully comp is cheaper than third party for car insurance.

It would be interesting to find out...

opinions4u

Costs of setting up the policy will be similar.

Beyond that, they will look at claims experience, level of cover and likelihood of renewal.

With an annual policy they probably get more repeat business, so bring in more income over time.

dzug1

If the total trips in the year must not exceed 31 days then that's a cheapo policy - most allow up to 31 days a trip with a higher overall limit

But if having checked the small print it suits you then go for it

Voyager2002

My guess is that the annual policy is a loss-leader: probably it will auto-renew at the end of the year and so they make it cheap now in the hope/expectation of a continuing revenue stream in the long term.

Moto2

A quick check I've just done on the Leisure Guard website
Returned headline figures of £32.50, single trip, £52.50 annual

53 yr old male, no pre-existing

InsideInsurance

The two are often fairly similarly priced, namely because as others have said you can be sitting on an annual policy for a couple of years "just in case" you have a holiday with no actual plans

Likewise if you did a big plan for a once in a lifetime trip 18 months away you'd need to buy two annual policies to cover the full period where as a single trip policy would be a one off payment.

You may also find those that travel sufficiently to warrant considering annual cover may well have considered buying other financial services that have travel insurance built in (eg bank current accounts) in which case the policyholder ends up with multiple policies providing cover and any claims are shared across all of them

joerugby

usignuolo wrote: »

OH and I are planning a trip to New York later this month for a flying visit (one week) to see the grandchildren. I went on line for a travel insurance quote - from Leisure Guard and got one for a single trip - I had to give the exact dates.

Then I thought I would see how much dearer it would be for an annual multi trip policy, still with Leisure Guard, given we might be back there in the spring. It was 25% cheaper!

The multi trip policy said it was valid for total of 31 days in any calendar year but did not ask us to state which dates we would be travelling. Also as OH and I are not getting any younger, I was surprised that no pre-existing health conditions were specified although fortunately we do not have any.

So why is an annual multi trip policy cheaper than a single trip one? I have checked very carefully and I have provided the same facts for both quotes.

I think you will find that 31 days is the "Trip limit", i.e. per trip.

Their t&cs for annual policies say:

"Irrespective of the number of individual Trips You undertake in each Period of Insurance, the maximum of days You can spend abroad must not exceed 183"

LGGeoff

I work for LG. Our policy allows you to have 31 days, per trip, as long as you are back in the UK on your 31st day.

JoeRugby is correct, you can be covered for a maximum of 183 days a year, providing you are not away for more than 31 days at a time.

The reason for the difference in price is because an annual policy is calculated using a different risk factor as a single trip policy. DanandJens Worldtravel pretty much sums it up. Single trip is calculated on a day by day basis, while annual multitrip is calculated as an average trip length per customer, number of trips a year, and the alike.