Travel insurance can be optional when travelling to most countries - barring 34 where it is mandatory - but it should be on top of your agenda when planning to travel abroad or even a domestic travel. Travel insurance not only covers medical benefits such as hospitalisation, emergency dental pain relief and personal accident but also non-medical ones such as loss of passport, loss or delay of checked baggage, flight cancellation and even personal liability, that is, third party damage.
Why you need travel insurance
It is often seen that people lose their passport, miss connecting flights, sometimes baggage arrives late, or they have to cancel trip owing to extreme weather conditions. If you have a travel insurance, it covers you against any monetary loss arising out of such mishappenings. It helps you with medical evacuation if need be or medical ambulance service. It even helps the family arrange the transfer of mortal remains if something were to happen to the insured person travelling abroad.
Yet, most people do not find travel insurance as important as car, bike or health insurance. For them, it could be just another document that the trip agent offers them as part of a travel package. However, the policy your travel agent has bundled with the travel package may not be sufficient for you.
"Often travel insurance offered by trip planners or travel agencies do not provide you adequate coverage. Hence, it is advised to buy travel insurance as per your specific needs and requirements by comparing various plans online," says Tarun Mathur, Co-founder & CBO, Policybazaar.com.
"Some important factors to keep in mind while buying travel insurance include total sum insured, country of visit, network of cashless-hospitals where you plan to stay and coverage for situations such as delay/loss of luggage or passport, missed connections and trip cancellation/delay," Mathur says.
How much travel insurance you need
The quantum primarily depends on the country that you are travelling to and the average medical costs there. "Before buying a travel insurance, you must check the average medical costs of the country you plan to visit and choose the sum insured accordingly. Some other factors to consider include number of travellers, age of the travellers, their current health conditions, duration of stay and country of visit and activities you plan to experience," says Mathur of Policybazaar.
Please note that a standard travel policy doesn't cover pre-existing conditions for which treatment is already on. If it's important to you, look for a plan that offers a pre-existing condition waiver. This could be expensive though.
Rakesh Goyal, Director, Probus Insurance Broker, says people often fall for low premium traps when buying a travel plan. "They don't read terms and conditions well in advance and don't check if the plan offers fixed coverage or not or if the plan can be used for all the trips throughout the year," he says.
Types of travel insurance
There are several types of insurance policies such as individual travel insurance, family travel insurance, senior citizen travel insurance, student travel insurance, multi-trip travel insurance and corporate travel insurance etc. Buy the one that suits your needs. "One must check for the type of the trip and buy insurance accordingly as it affects the premium amount," says Goyal of Probus Insurance Broker.
The description of few is given:
i) Student travel insurance: Of late, studying abroad has become quite common. It's important for parents to buy travel insurance for their kids studying abroad. "The cover should provide comprehensive coverage against medical emergencies. It should also cover your child against possible incidents such as study interruption, sponsor protection, university insolvency, loss of laptop/table, loss of baggage, passport and important documents. Parents must also ensure that the student travel insurance adheres to the university-issued guidelines," suggests Mathur of Policybazaar.
Below is a price comparison of top insurers offering student travel insurance to a 20-year old student travelling to the USA for a 1-year University program.
ii) Multi-trip plan or corporate plan: Frequent travellers can buy multi-trip plan or a corporate plan. "Working professionals on the official trip should check the validity of the plan, benefits/features associated with the plan, eligibility criteria, check if the plan covers loss of passport, omitted/optional covers, expenses for trip delay and legal liability," suggests Goyal of Probus Insurance.
iii) A domestic travel plan includes coverage for loss of baggage, trip delay, trip cancellation, personal accident, personal liability, trip curtailment, accidental death, home burglary insurance, and hospitalisation day allowance, if any.
Buying insurance when on domestic travel is not popular. Experts say one should buy a domestic travel plan if one is not covered under any health or life insurance policies
What to do when emergency strikes
You must keep the helpline number of the insurer handy at all the time. During an emergency, you must inform the insurer over a call or mail about the entire incident within 24 hours. Make sure to include all possible supporting documents to avoid claims rejection. Your claim against your travel insurance policy can be rejected based on various cases.
"All the insurance policies come with exclusions, and policyholders not being aware of the same can lead to claims rejection later. For instance, not disclosing pre-existing conditions may lead to claims rejection. Any loss arising due to participation in adventurous sports is also not covered. Besides, Travel insurance companies would be unlikely to accept your claim if it is found that you were under the influence of alcohol or drug when an accident occurred," says Mathur.
Shailesh Kumar, Co-Founder of Insurance grievance redressal start-up Insurance Samadhan has an important advice: Even if you have opted for a sum assured, each risk may have a sub-limit; do check for sub-limits.
For example, Insurance Samadhan recently received a complaint that a large claim of Rs 6 lakh was denied due to sub limits clause. "This case was taken to Ombudsman and they gave the order in favour of it. However, third-party administrator (TPA) did not accept the same and we have filed the case with consumer forum," says Kumar of Insurance Samadhan.
So, next time when your travel agent offers you a travel insurance plan, dig into the nitty-gritty of it, compare it with other plans available online and choose the one that best suits your requirements.