A friend of mine just returned from a week-long holiday in Singapore. She had a fall and ended up going to the hospital to get a painkiller and a few stitches.
Needless to say, it set her back by quite a few dollars -- Singapore dollars in this case.
Being a meticulous person, I had a look at her checklist before she left. It included clothes, footwear, camera, gifts, hotel bookings, tickets, visa and foreign currency as the broad categories (with innumerable sub-heads in some cases).
But she forgot a crucial element -- insurance.
My friend is not alone in making this kind of mistake. It is estimated that there are around 6 to 6.5 million* trips made abroad in a year. But, of every 10 tickets booked, only two or three passengers opt for travel insurance.
Do I have to get insured?
The answer to that depends on where you are headed.
Only the 15 Schengen countries insist on an insurance cover. With a Schengen visa, a traveller may enter any one of the member European countries and travel freely throughout the Schengen zone.
The Schengen countries are Austria, Belgium, Denmark, Finland, France, Germany, Iceland, Italy, Greece, Luxembourg, Norway, Portugal, Spain, Sweden and The Netherlands.
Those who are over 60 years old and travelling to the United States, Canada or Australia must have an insurance policy. Insurance, however, is not compulsory for those who are younger. So, unless mandatory, most travellers do not take travel insurance.
In case you think travel insurance is just a con job, one private travel insurance company claimed they had 5,000 claims last year. If anything, this indicates that, at times, things can go wrong (as my friend will testify).
It costs money, does it not?
Yes it does. But, if you are counting your dollars, you need not worry. You have to pay the premium in rupees. The reimbursement will be done in the currency of the country/ countries you will be travelling to.
Should you fall sick, the entire hospital treatment will be paid by the insurance company up to the amount insured. So, you pay in rupees here and are covered in the local currency of the country/ countries you are visiting.
In fact, it works like a cashless service. The moment you gets admitted to the hospital, you can call the contact number provided and give the policy number to the hospital. The insurance company will make the payment directly.
For any problem -- as covered by the insurance company -- you may face, you can call the contact numbers given to you.
Do note: when you take an insurance policy, only the person taking the policy will be covered. So, if you are travelling with family, you will have to get an insurance for each family member.
Which brings us to what is on offer.
What will be covered?
You may be in excellent health and not feel the need for a cover. But travel insurance does not just cover illnesses. What if you meet with an accident?
Interestingly, if you look at the insurance packages, what is being offered today is not just health but a comprehensive package that ensures compensation and peace of mind when travelling abroad.
The most essential aspect of travel insurance relates to the medical angle. It will cover hospitalisation and expenses due to sickness or an accident.
Emergency dental treatment is also considered.
Should you lose your passport, you will have to get a duplicate passport issued abroad and pay for it in the currency of the country you are in. These expenses, if covered by your insurance, will be taken care of by the insurance company.
If baggage is lost or delayed and you are stuck with no clothes, you will be given an allowance.
If there is a flight delay or cancellation and you are held back till the next flight, you will be given a fixed allowance.
In addition, some policies also give a home insurance in case your home in India was burgled while you were on holiday. There is also a hijack distress allowance in case your aircraft is hijacked.
Do note that all of these will have an upper limit. Look at them closely when comparing polices. The passport loss, for instance, may just be limited to $200. The dental treatment may be capped at, say, $250. The hijack distress allowance will only be for a fixed number of days (five or seven) and a fixed maximum allowance per day.
Check the exclusions too. If you already have an illness when leaving the country, you will not be reimbursed for it if you have to get treated abroad.
Also, if you meet with an accident as a result of war, it will not be covered. If the accident was a result of your drunkenness or addiction, that too is excluded.
And yes, cosmetic treatment is certainly not on the cards.
How much will this cost you?
Go through the policies in detail to find out who is offering what. If you find such add-ons unnecessary, go for the most basic package on offer.
A basic policy for 28 days or less that will give you a cover of $50,000, would cost you between Rs 850 - Rs 950 on an average. This is a one-time payment and is calculated on the assumption that you are less than 40 years of age.
Their policies are always offered based on geographical location: Worldwide, worldwide excluding the United States and Canada, and neighbouring countries. The above figures are for a worldwide policy.
Depending on which insurance company you opt for, the basic package will differ. With some, it may just be the reimbursement of illness and accident expenses and hospital costs. But, another company may include lost passport expenses and flight delays too.
Where can I buy it?
The private insurance companies have some good schemes on offer. Check out Bajaj Allianz, Cholamandalam MS, ICICI Lombard and Tata AIG Insurance.
Some of them even sell it online, so all you have to do is log onto their Web site and buy it.
Or else, check with the banks. HSBC sells insurance Tata AIG. Similarly, ICICI Bank sells insurance of ICICI Lombard.
Also check with the travel houses or your travel agent. Thomas Cook, for instance, sells travel insurance of Tata AIG.
Depending on the number of days you are going to be abroad, you can take a policy for that time period. But, if you are going to be making more than one trip abroad in a year (business or pleasure), then it may make sense to opt for a one-year policy that takes care of multiple trips.
*This number includes trips made for business, tourism and education. It could also mean one person making more than one trip, as in the case of corporate travel.
