Buying Travel Insurance? You NEED To Read This!

You may have heard of (or even experienced) postponed flights, lost or damaged luggage, and accidents overseas.

With travel insurance for any trip you make (or an annual plan if you're a frequent flier), you can travel without fear of the unexpected. Isn't that great? However, are you sure that the policies provide the right coverage in unique situations? Unsure what to look out for now? No worries. Here‘s a guide on what to look out for before buying your next travel insurance.

1. CHECK: What Exactly Does It Cover?

Not all insurance policies are the same. You might have seen different tiers of travel insurance plans when making your purchasing decision. But what really is the difference between them, other than their pricing and fancy names?

Some of the coverage types included in travel insurance plans:

• Trip Cancellation and Interruption Insurance

This reimburses you on non-refundable travel costs if your trip is cancelled or severely delayed due to illness, natural disaster, etc. The coverage in this area varies by who you get it from and individual policies that you may have purchased.

• Baggage and Personal Items Coverage

If your baggage is stolen or damaged, travel insurance is there to reimburse you. Even the most basic travel insurance in the market will give some degree of coverage in this area.

• Emergency Medical Insurance

It has the same reason as why people are covered by medical insurance in everyday life. The extensiveness of this coverage often varies widely, so be sure to read thoroughly!

• Accidental Death Insurance

This insurance type offers payouts of differing amounts depending on the situation. For instance, if you or a loved one dies on the trip or suffers a life-impairing accident, such as losing the sense of sight. The extensiveness of the coverage often varies widely.

2. RE-CHECK: What Doesn't It Cover?

It’s good to consider the limitations of the travel insurance policy that you are considering, before committing.

For instance, most travel insurance provides coverage for cancellation and interruptions, but the reason for the cancellation makes a difference because not everything is covered. Most travel insurance policies will provide a list of covered reasons for trip cancellation. If your reason is not on the list, it means that you will not be covered. It is recommended to run through scenarios which you might encounter and see if the policy you are considering to get can provide protection in that area.

Lastly, any cancellations for medical reasons need to be recommended and documented by a certified doctor. This means that you cannot just cancel a trip because a family member has fallen ill without a doctor's stamp of approval.

3. PRICE: How Much Should It Cost?

Expensive doesn’t always mean better. Let's look at how the cost of the plan is being calculated to understand how much travel insurance policies should cost.

Here are some of the factors that providers will include in their calculations other than the cost of your trip:

• Age of the travelers

Generally, a traveler who is over the age of 65 can expect higher rates. If you are traveling with young adults or children, you may be able to add them to the plan at no additional cost, or at a lower rate. This really depends on the travel insurance company and their fine print.

• Number of Travelers and Length of Travel

The number of travelers and length of travel can affect the rates of the plans as there are more variables introduced, resulting more risk attached to the plan. For example, you are travelling with 5 people for 3 weeks, there is a higher possibility of medical risks and travel interruption than if you were to travel with 2 people for just a week.

• Type of Coverage

The type of coverage you choose will also influence the cost of the insurance policy. A basic plan will naturally cost less than one that includes a ton of optional benefits. Similarly, higher coverage limits for medical expenses or medical evacuation will result in higher cost.

4. READ: The Fine Print

One of the most common and biggest mistakes people make when choosing a policy is not giving the policy document a good thorough read. Failure to read the policy document can put possible future claims at risk, as the different types of risks the trip may present was not considered beforehand. Take note of the schedule of benefits, as it provides important information such as the terms and conditions of cover, limits of payout and the procedures of claims submissions as well as emergency contact numbers.

Understand the fine print and it will pay off well if you take some time to read it. A little time taken to do this can save hours or even days of frustration if there are any hiccups while you’re overseas.

Travel insurance is well worth it...

... if you're going overseas and your health insurance does not cover international emergencies or when your trip is largely non-refundable. It costs just about 5% of your total trip expenses and cushions the impact of unexpected travel occurrences.

Have a safe trip!