Go for travel insurance before packing your bags : Business Line

Planning an overseas trip? Well, you’ve pulled up a chair and set to work, researching flight options, hotel options, even money options. But if you think that your planning ends there, think again. You also need insurance. Yes, the chances of getting run over by a car are remote, but it’s always wise to plan for emergencies. An unforeseen medical illness can hit your finances hard.

And that’s not the only kind of trouble that can befall you. Luggage lost, flights missed, passport or money stolen, all serve to make your foreign trip a nightmare. Here’s where travel insurance can help you.

A travel insurance policy varies depending on the purpose of the visit, such as a leisure or business trip. Leisure travel policies are usually one-time policies.

But for frequent business travellers, insurers offer multi-trip insurance which will provide for 30-45 days cover for a trip until the expiry of the policy. In case you are planning a vacation abroad with your family, you can opt for a family policy.

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RISKS COVERED

Travel insurance policies address two basic groups of risks. The first group is medical risk. These include expenses on illnesses or injuries due to any accidents, daily hospital allowance if you’re hospitalised and so on. Expenses are usually subject to an upper limit depending on the policy. For instance, ICICI Lombard Gold plan for non-US and Canada, offers a medical cover of $100,000 for 32 days.

The second type of risk covered is non-medical in nature. This includes loss of passport or baggage, theft, trip cancellation, missed connecting flights. Continuing with the ICICI Lombard Gold Plan example, you can claim reimbursement up to $100 if your baggage is delayed for more than 12 hours. And in case you lose your passport, you can claim compensation up to $200.

Under Chola MS Insurance’s Gold plan, if your trip gets cancelled prior to commencement due to various causes – and these can include routine ones such as bad weather to more extreme such as terrorist activity or death of immediate family members, you can claim up to $500 towards reimbursement on non-refundable expenses.

In most insurance policies, standard cover includes medical expenses and repatriation on account of illness and accidents, cancellation of travel, delayed departure, theft of personal possessions, delay or loss of checked-in baggage and personal liability. Additional cover extends to terrorism and repatriation of remains in the event of death, to name a few. What travel insurance does not cover are events such as suicides or adventure sports and pre-existing illnesses unless it leads to a medical emergency.

POLICY PREMIUMS

Policy premium varies depending on the travel destination, age and risk. If you’re travelling to countries in the Asia Pacific region, your policy will cost less than if you were going to the US and Canada. Using the ICICI Lombard example from above, the non-US and Canada plan will cost you Rs 1,347. The premium for same plan including US and Canada costs Rs 1,933.

This may be largely due to the differences in the cost of healthcare in these geographies. A heart bypass surgery in Asia costs about $10,000 while the same surgery in the US will cost you over $60,000. There are also specific insurance plans for senior citizens.

So keeping the various risks and claims in mind, here are a few pointers to zero in on while finalising the travel insurance policy.

First, identify the risks that you want to be covered by the travel insurance. Insurers typically provide a standard cover along with an option to choose from the additional risk covers available.

Second, decide on the quantum of medical coverage, based on your assessment of the vulnerability to risk. The premium will vary depending on the events you choose to insure against and the quantum of coverage. There are options to address risks if you’ve got the itch to take a hot-air balloon ride or bungee jump off bridges.

Three, compare the product offering and premium of other insurers before finalising your travel policy. This will help you ensure value for money. There are a number of insurers offering travel policies such as Tata AIG, HDFC Ergo, Iffco Tokio, Bajaj Allianz, Reliance General to name but a few.