iPod, bags, tickets, handy cam, hotel bookings and all other top-of-the-mind recall items are taken care of while running away for a vacation or holiday. It is rarely that one thinks of taking a travel insurance policy for self and family. But that’s the fate of almost every kind of insurance except car insurance which is mandatory. It is very important to realise that a small mishap by the airlines or an injury is all it takes to hamper our lovely dream vacation.
Insurance is never prioritised till something actually goes wrong. And by then it’s too late to take the insurance policy. Travel, especially abroad, is a very important part of our lives these days and none of us really wants to think about something going wrong.
But the fact is that more often than not we end up facing some problem like loss of baggage, delay or cancellation of flights or a medical emergency. Therefore, it is crucial to be covered at such times when you are away from home and have limited or no access to resources.
Definition and Coverage
Travel Insurance means insuring the risks of having a financial loss or a medical emergency while travelling. Travel Insurance can be temporarily purchased for a single trip. However for frequent fliers, Travel Insurance can be taken for a whole year and it suffices for ‘n’ number of trips throughout the year. Leisure travel, adventure travel, cruise travel, overseas student travel, business travel and international travel are all various options that can be insured. The most common risks that are covered by overseas travel insurance are:
- Overseas Medical expenses
- Accidental death or injury
- Loss, theft or damage to personal possessions, money, travel documents
- Delayed baggage, Loss of baggage, Emergency replacement of essential items
- Loss of passport
- Trip delay
- Missed connecting flight due to delay
- Trip Cancellation expenses due to unforeseen weather conditions, etc.
- Overseas Dental Treatment
The cover varies from insurer to insurer and with the many different policy types, but a comprehensive product will usually provide you with cover for the following: medical treatment, emergency repatriation, theft, cancellation, loss of baggage, passport lost, etc.
Premium Calculation
Travel Insurance premium is directly proportional to the risk involved in travelling. Thus, the premium depends on:
- Health Conditions
- Age of Traveller and the Sum Insured of the Plan
- Duration of Stay
- Number of travels
- Place of travel
- Hazardous and Other sports and activities involved in the travel, etc.
Four tips on choosing a good travel insurance policy
A travel insurance policy is a very standard product across insurance companies since the usage is more global in nature. However, there are few things which you can look at before buying a policy to save yourself some premium and a lot of hassles –
1. Location
Travel insurance premium is higher for places where health costs and other services are expensive. Today, the customer can narrow down his international policy to select from options such as includes Americas, excludes Americas, within Asia, within India etc. Hence be sure to narrow down your location of travel to gain the benefit of premium.
2. Frequency and Duration of Travel
Usually companies offer travel insurance policies for a trip duration ranging from 30 days to 180 days. It is recommended to select the duration of the policy equal to or slightly more than your actual travel period. Premium amount is higher for longer travel durations. If you are a frequent flyer, it is useful to opt for annual multi-trip policies to save you money and more importantly the hassle of buying a policy every now and then. These plans are valid for a year and usually cover any number of trips abroad, each trip having a maximum duration of 30-45 days. This would prove to be cost effective if you are a frequent flyer.
3. Age of the members travelling
If you are travelling in a family, then it can be helpful to check if the premium in one policy that covers all is cheaper or does it help in buying two policies whereby the elders can be covered under another policy. For example, if you are above 65 years of age, you can opt for plans for senior citizens with special features like pre-existing illness coverage, higher sum insured for frequent hospitalization, etc.
4. Purpose of Travel
Ensure that you declare the purpose of your travel correctly in the application form whether it is a fun vacation with family, or outing with friends, or it is an adventure trip involving trek, skiing, water sports, etc you must mention the same on the proposal form. A regular travel insurance plan will not cover risks involved in adventurous activities. However, an additional premium may be paid to get the coverage for such activities.
There are many types of travel insurance plans today so you should compare between policies from 3 to 4 insurers to get the best deal. The cheapest policy may not always be the best or comprehensive enough.
Have a great holiday and safe trip. Bon voyage!
