Do I Really Need Travel Insurance?

Today, everyone’s a jetsetter. Whether it’s for work, holidays or any excuse to get out of the office and country, we’ll take it. Travel insurance can often feel like a complete waste of good money but it’ll end up being the wisest choice you made if your flight gets delayed or your luggage gets lost in another country.

Travel insurance helps to cover some costs caused by inconveniences before, during and after the trip. But don’t just buy any travel insurance, here are some things to note as a beginner.

Scope of coverage

There are various scopes of coverage such as:

  • Medical evacuation, which involves air lifting you to the nearest hospital and back home. This would be my personal reason for buying travel insurance. If I were to get into an accident during a ski trip, I would want to be sent home as soon as possible, and be in the comfort of my own country and be with my family. A medical evacuation from Haikou, China to Singapore in 2015 was $175,000. And if you have it covered in your insurance, that would mean you pay nothing for that ultimate lift home!

  • Loss of belongings during travel, including your valuables like laptops, handphone, money, passports. Some countries are safer than others. If someone robs you of your belongings, you won’t necessarily be able to get the item back, but at least your insurance can help to compensate you (partially) for replacing the item.

  • Medical expenses abroad. You never know when a medical emergency would happen and if it happens overseas, travel insurance can help to cover those crazy costs involved. Some accidents require immediate attention before you can be airlifted back to your home country so it would be important to have this coverage too.

  • Medical expenses upon returning. The sudden change in weather from sunny Singapore to the Swiss Alps, can cause you to catch a cold. Travel insurance allows you to get reimbursed for medical bills incurred within the 3-7 days from the return due to illnesses that occurred during or because of the trip.

  • Travel cancellation due to a family emergency, natural disasters or emergency situations. Most flights are non-refundable but with insurance you can make sure that you don’t lose all that flight money if anything major happens before you can go on your flight.

There are many terms to keep an eye out for:

  • Annual or single trip – Check if the coverage is for single or annual trips. Annual trips are usually capped at a maximum of 180 travel days.

  • Non-committal – Check if the terms are non-committal meaning you don’t need to renew the annual travel plan and the insurer can also choose to do the same.

  • Refund – The terms would often include that you don’t get any refund on your premiums even if you don’t make a claim.

  • Prices vary – Depending on the claims experience on the overall industry and the insurer, they may increase the insurance premium rates without any explanation in the future.

  • Geographically categorised – The insurance are categorised into areas of coverage, usually Asia alone and Global. Even when it says global, it does not cover places with your local travel advisory board advise against, or war zone areas. So do take note of such terms and make sure you’re covered for the country you’re going to.

Here are some common pitfalls that you may not be aware of:

  • Pre-existing illnesses are not covered. For example, if someone with hypertension has a heart attack during a roller coaster ride during their trip to Australia, regular travel insurance will not cover it. However, there are now some providers that cover pre-existing conditions as part of the travel insurance. Just note that these options are, of course, a lot more expensive.

  • Insurance costs the same whether you buy it 10 days in advance or 1 day in advance. You should always buy your travel insurance as soon as you book your trip. The premiums are calculated based on your actual travel dates, so it won’t cost you more when you buy it earlier. Better yet, you can get covered for unforeseen trip cancellations if you or a family member have a medical emergency.

  • You simply cannot buy travel insurance after your travel has started. If you forgot to buy it before your trip, and you’re already in another country, pray hard nothing happens and don’t waste your money buying travel insurance.

  • Medical expenses are covered within a specific timeframe upon returning. This is usually 3 days or slightly more. If you fall sick during the trip and did not get to see a doctor while travelling, your costs can be covered if you see a doctor when you return.

  • Keep your flight ticket stubs for unforeseen claims. For most claims, you would need your boarding passes both to and from the trip. Don’t be too quick to throw away the boarding passes once you’ve reached your destination. In case of a mishap, I always keep my boarding passes for a week after my trip.

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