With Indian taking trips to foreign lands often, travel insurance is increasingly gaining popularity. Nikunj Gandhi lists everything you need to know about it
The indomitable spirit of travelling and exploration has been associated with human kind since time immemorial and the millennials are no different. However, the trend of foreign travel amongst us urban Indians has certainly seen a surge in recent times. Gone are the days when a short trip to a nearby hill station or a couple of days by the beach would have sufficed for the rejuvenation of spirits. A quick trip to foreign lands has satiated the curiosities and enthusiasms of the modern traveller and seems to be the new order of travelling.
The excitement levels reach new highs in the planning process itself. However, a rational approach in the planning process itself should include the possibility of occurrence of any eventualities and the means to circumvent or protect against such contingencies. Buying a travel insurance is a step forward towards this thought process. There is an assurance of being prepared for any untoward instances which can substantially reduce the agony and stress when things go wrong.
Some of the common things that could go wrong during foreign travel:
Medical Emergency: What if you slip and break a bone, suffer from food poisoning? Medical attention, possible hospitalization, and any medication you may need could burn a huge hole in the pocket
Evacuation Due to Medical Emergency: What if you or a family member falls seriously ill during the trip and the medical facilities aren’t equipped to handle the situation? Who will pay for the emergency medical evacuation?
Lose Your Passport / Wallet: What will you do if your ID, credit/debit cards, and all of your cash were lost or robbed?
Baggage Loss: What if the airline loses your luggage? Who will reimburse you for the additional clothes and toiletries you will have to buy?
Reimbursement of Prepaid Expenses: What if you prepaid the cost of your trip to take advantage of special discounts, but you get really sick and have to leave? Who will reimburse you for the remaining hotel days that you’ve already paid for?
Evacuation Due to Political Unrest or a Natural Calamity: What if a riot breaks out due to political unrest and you need to immediately evacuate for safety reasons? What if there is an approaching hurricane, and you have to evacuate your destination? Who will refund you for the emergency plane ticket you had to buy for safety reasons?
How can an insurance cover help :
Medical and dental coverage provides the funds and helps you locate local medical facilities that can properly treat your injury or illness. Many plans will pay for care in specific hospitals, doctor offices or “in-network” health care providers
Travel delay coverage provides a certain amount of money for unexpected hotel, dining, and transportation costs when your travel is delayed for a covered reason.
Trip cancellation coverage helps you recover your pre-paid non-refundable expenses when a trip is cancelled for a covered reason.
Baggage delay coverage provides reimbursement for the essentials while the airline locates and returns your checked luggage to you.
Loss of Baggage provides a certain amount of reimbursement when your luggage is irretrievably lost, damaged or stolen.
Emergency travel assistance services ensures that you have the help you need to locate alternative flights, track lost luggage, find local medical care, and in some cases they provide business-specific services such as obtaining business equipment, translators, drivers, tickets to special events, and more
Emergency evacuation/repatriation coverage ensures that emergency medical evacuations and repatriation coordination and expenses are covered for you.
Hijack Risk Cover provides for payment of an allowance in the event of hijack of a common carrier
Personal Liability Cover provides indemnity towards legal liability to a third party for an incident which results in accidental death, injury or damage to the health or property
Accidental Death and Dismemberment Cover pays compensation in case of an accidental injury that results in loss of life or permanent total disablement
Emergency Cash Assistance in the event of a financial emergency arising due to theft, mugging, robbery of funds
Considerations for choosing a Travel Insurance Plan :
Company Goodwill: This provides an overview of the company’s past record in terms of claim settlement percentage as well as the sort of clientele it holds. A good track record of some or no complaints is surely the best option to choose from
Solvency Ratio: A high fiscal credibility of an insurance provider will increase its chances of selection
Sum-insured: The sum that is insured is directly proportional to the premium
Affordability: This factor solely depends on the extent of your travel budget for insurance. It is better to opt for plans with lower premiums
Age: Insurance plans for travellers differ with their ages. The premium paid is directly proportional to the age
Coverage: This is an another important aspect as the add-ons that you may opt for that will impact the premium you will pay
Others: Includes duration, destination and purpose of travel
Types of Travel Insurance Plans :
Single trip: This type of insurance is typically custom made for an occasional traveller. The maximum period of this plan generally does not exceed 6 months. It is best suited for businessmen or individuals who travel overseas on occasions and covers accidental death, emergency evacuation, medical expenses, disablement benefits and delayed departure and baggage
Multi trip: This plan is designed for people who frequently travel to overseas locations usually valid for a year and may slightly vary depending on the insurance provider. The traveller can choose from various days as the duration of their trip. This is one plan that saves money for the frequent traveller. It is also convenient as the traveller has to pay premium just once and is secured for an entire year for their travel.
Family travel insurance: This is also termed as Family Floater Plan which provides comprehensive financial coverage to the entire family while traveling overseas for a single trip. Within this plan, each and every member of the family is covered under a blanket policy with a single premium. The family members share the sum assured in this plan
Foreign Travel is as happy occasion and shouldn’t dampen the spirits as a result of all the above negative discussions. But such is the goal of insurance – to protect us from life’s least happy circumstances. However, there is one type of coverage that is included in the Travel Insurance to protect us from the consequences of unusually good luck, and it’s called Golfers-Hole-in-One Policy. The concept of hole-in-one insurance may baffle the uninitiated, but to many, it is a wise precaution, as golf tradition holds that anyone who scores a hole-in- one should buy drinks back at the clubhouse for his playing group. Such coverage protects from the potentially bankrupting consequences of sinking a hole-in-one.to the exuberant golfer buying rounds of drinks for friends and even strangers! So if you hit an ace during your next foreign travel, you know you are covered for a happy reason indeed!
Nikunj Gandhi is an Equity Investor and can be reached at [email protected]. These are his opinions and not necessarily of the newspaper’s.