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Insure yourself while travelling

Travel insurance should not be viewed as avoidable expenditure.

How many times have you declined to buy travel insurance while booking your air tickets? If flight delays or cancellations, lost baggage, medical emergencies or even misplaced travel tickets sound familiar, then the travel insurance you ignored could have rescued you.

Buying travel insurance has assumed greater importance over the years since travel, domestic and overseas, has become easier on the pocket. "The rise in the number of travel operators offering incentives and discounts, cheaper airfares, and increased spending by the urban population has increased the number of travellers across the world and within the country," says Tapan Singhel, Chief Marketing Officer of Bajaj Allianz General Insurance.

In fact, increased travel is a boost to travel portfolios of insurance firms. "The travel insurance industry is growing at the rate of 20 to 25 per cent annually," says Sanjay Datta, Head of Customer Service at ICICI Lombard General Insurance.

However, this is still low when compared to developed nations. "Insurance penetration in the West and Japan is almost 100 per cent, whereas in India it is at around 20 per cent for international travel and negligible for domestic travel," says Gaurav Garg, Managing Director and CEO of Tata AIG General Insurance.

All too often we travel uninsured because we look at it as a superfluous cost, where money spent is money wasted. "Leisure travellers are usually price sensitive, which is why many are reluctant to buy travel insurance," says Singhel.

How to pick the perfect policy

  • Know your requirements before picking a policy
  • Do a comparative study
  • Choose a product of a reputed company
  • Read the fi ne print carefully
  • Take note of the exclusions and waiting periods
  • Fill up the proposal form yourself. Do not depend on agents or any third party
What won't be covered
  • Maternity, pre-existing ailments and complications arising out of them
  • Illness contracted while travelling against the advice of a physician
  • Venereal diseases, mental disorders, anxiety and depression
  • Suicide or attempted suicide
  • Injury caused due to war, terrorism or any illegal acts
  • Accident occurring from participation in dangerous sports

"One of the prime reasons for reluctance to buy travel insurance in India is lack of awareness. The need to cover your trip is rarely felt unless it is compulsory to have travel insurance before obtaining the visa," says Antony Jacob, CEO of Apollo Munich Health Insurance.

Like motor insurance, making travel insurance compulsory will boost sales. But will this benefit buyers? "A mandatory clause benefits both insurers and customers. With more people buying travel insurance, insurers will have more volume to cover their risk and can price products better," says Garg.

Reasons to buy
Imagine arriving at your destination with your baggage missing, including your passport, or falling sick and having to foot medical bills in a foreign country. The benefits of travel insurance far outweigh its cost. A typical plan covers accidents and sickness (including medical evacuation, repatriation), airport mishaps (baggage loss, flight delays or cancellation, loss of passport) and emergency financial assistance. Another important feature is the personal liability cover, which comes in handy in the case of unintentional damage to others' property. Make sure to have this, especially when travelling with kids. All this will cost you only as much as five to six per cent of your airfare.

Though many agree that travel cover is a must when travelling overseas, most are doubtful of its need during domestic travel. "You can skip travel cover for domestic trips as health and accident policies should cover these exigencies," says Mukesh Kumar, Head of Strategic Planning Group at HDFC ERGO General Insurance.

Adds Yashish Dahiya, CEO of policybazaar.com: "Some airlines cover delays and cancellations, while others don't. Therefore, if you travel frequently, you might consider taking a cover."

The right plan
There are separate policies designed for individuals, families, students going abroad and frequent flyers. There is even one for those in the golden years of their lives. So which one is best suited for you? Says Singhel: "Choose a policy as per individual requirements, considering duration of travel, cover required and countries being visited. The right features also help in saving premium."

Datta also advises undertaking a comparative analysis before buying any policy. "The buyer should compare offerings, including online services, claims process, payment options and tie-ups with facilitators and service providers abroad." Moreover, the insurer should be a recognised player with a good track record. "The buyer should always check a company's claims settlement history," adds Singhel.

Do not forget to read the fine print and pay attention to the exclusions. "Any insurance policy would have broad exclusions and waiting periods for effective coverage," says Jacob. Along with this, also get information on the documents required to file a claim. Documents required for loss of baggage will differ from those for medical evacuation. "One should always carry one's documents along. A good way is to have them online so that they can be accessed anytime, anywhere," says Datta.

Courtesy: Money Today