Everything you need to know about travel insurance – Forbes INDIA Advisor

What is travel insurance?

The Covid-19 pandemic has shown that even perfectly planned itineraries can sometimes go awry. Caution is paramount and all safety measures must be in place at all times. This is not limited to vaccinations, masks and disinfectants, but travel insurance is also a priority.

While planning a trip, many people understand that travel insurance is a mandatory requirement when applying for a visa to certain countries. However, many of them buy travel insurance just to comply without going into the details of the policy they are buying and what exactly it covers. There are a number of factors that distinguish one policy from another.

Also, travel insurance should be on your checklist while planning a trip, whether it’s mandatory or not. In order to get the most out of your policy, it is imperative that you understand what is covered and what is not. So here’s a summary of everything you need to know about travel insurance.

How does travel insurance work?

A travel insurance policy covers various types of financial losses that a person may encounter during their trip. The policy term is usually the entire duration of the trip. While this protection is quite useful while traveling abroad, one can also get travel insurance to cover their travels within the country. Depending on the policy you buy, you can get coverage for emergency medical expenses while traveling, trip cancellation and delay, lost baggage, delayed checked baggage, lost passport, accidental death or disability, etc.

Since the cost of travel insurance is only a small part of the cost of the entire trip, it makes sense to choose it to secure your trip. By making this small investment, you ensure that you won’t suffer a big loss if you have to cancel the trip, cut it short or even face any health emergency during the trip. For example, you can get a starter plan for just INR 50 per day for a 15-day trip to the UK.

Plus, in these uncertain times, your travel insurance also comes with global cover against the Covid-19 virus. If you are infected with the Covid-19 virus while traveling, your medical expenses will be covered by your insurer. Travel cancellation or delay due to Covid-19 is also covered by travel insurance policies.

Types of travel insurance plans

Not all travel insurance policies are alike. There are mainly variations depending on whether you are traveling domestically or internationally, whether it is for a single trip or multiple trips, and whether you are traveling alone or in a group. Here are the main types of travel insurance plans:

International and domestic travel insurance plans

While the former covers foreign travel, the latter covers domestic travel. Even in the case of international travel insurance, plans are often divided into countries they cover. Therefore, there are plans that cover specific countries or regions; meanwhile, others cover all but a few countries. Finally, there are some plans that cover travel to every country without exception.

Single and multiple trip insurance plans

As the name suggests, a single trip insurance plan covers one particular trip for a specific number of days clearly stated in the policy. This starts from the date of departure to the date of return. On the other hand, a multiple trip insurance plan covers multiple trips taken within a period of one year from the policy inception date. This is a convenient option for those who travel often. It is not only convenient but also cost-effective to choose a multi-trip insurance policy if you travel several times a year.

Individual and group travel insurance plans

Individual travel insurance plan is for those who travel alone or with their families. While the name says individual, it covers the policy holder and his/her family members accompanying him/her during the trip, as long as their names are clearly mentioned while purchasing the policy.

On the other hand, a group travel insurance policy is for companies whose employees travel for work. Tour operators often purchase a group travel insurance plan to cover individuals who may be traveling together as part of a package tour. This type of insurance is often included in the travel package.

Student travel insurance plans

The Covid-19 pandemic has caused millions of students to suffer due to the restrictions imposed. This is especially true for students studying abroad. A student travel insurance plan comes in handy in such a situation as it not only covers medical expenses that may eat into your limited expenses while studying abroad, but also reimburses semester fees paid if the policyholder’s studies are interrupted by real reasons. In addition, these plans also cover the cost of canceled trips.

What a travel insurance plan covers

Emergency medical expenses

Traveling is fraught with risks, especially when traveling to a land with a different climate, culture, customs and food habits. What you planned to be a relaxing vacation can quickly turn into a stressful nightmare when an unforeseen emergency occurs and leads to not only mental stress but also financial stress. In an unfamiliar place, finding help can be difficult, especially in the case of additional financial costs you may incur due to a medical emergency that exceeds your travel budget.

However, if you have opted for travel insurance, it will cover your hospitalization expenses as well as your other medical bills if you become ill or injured. In the event that there is no suitable hospital nearby, some policies even cover the cost of emergency transport and evacuation services to transfer the patient to an appropriate medical facility.

In addition, some plans also offer daily sick pay if you are hospitalized during your trip. This allowance can help you take care of those additional expenses that may be related to, but not fall into, the category of medical expenses. Some travel insurance policies even cover post-hospitalization expenses up to a certain period of time. It is therefore advisable to confirm whether the plan you are considering offers all these benefits.

Cancellation and shortening of a trip

Consider this scenario: You’ve made elaborate travel plans to your favorite destination. You’ve booked tickets, made hotel reservations, and even paid for that cruise you’ve been meaning to take with your loved ones. However, just a day or two before the expected date of departure, you are forced to cancel the plan – perhaps someone in your family has suddenly fallen ill and is unable to travel, or there has been a death in the family, or there is a forecast of sudden weather disaster or crisis at your destination. What happens to the money you’ve already spent on arranging your trip? With a decent travel insurance policy, you will be reimbursed for all prepaid and non-refundable travel expenses.

On the other hand, what if you are already on your way and in the middle of it you have to cut it short due to an unavoidable emergency? With trip interruption coverage, which many insurers offer, you get protection against such a scenario as well. The insurance policy would not only reimburse you for hotel bookings and other prepaid expenses, but also cover the cost of your return flight, which you may have to book at short notice and at exorbitant prices. Also, if due to an unforeseen event the departure of your flight is delayed beyond the specified reasonable period of time, the insurer compensates you for the same.

Another event where a travel insurance policy comes as a lifesaver is when you are traveling on connecting flights to your destination and miss one of those flights due to unavoidable reasons. Travel insurance covers the cost of the new flight you need to book in place of the one you missed if it’s part of your cover.

Loss or delay of baggage

Let’s say you arrive at your destination, but your checked baggage is delayed. Or worse, your luggage never arrives at its destination and gets lost. All your belongings are gone in a flash. This can put a significant strain on your travel budget. Even in the event of a delay, which can take anywhere from 12 hours to a week, you will be forced to purchase some items until your luggage arrives. You would not account for these costs when planning the trip. So, does this mean your entire travel plan goes to waste? The answer is no if you have travel insurance.

If your checked baggage is lost by the airline, the policy will cover the financial losses, regardless of whether it is lost or delayed after the specified time (usually 12 hours). So you can go ahead with your vacation as planned without worrying about these costs.

Loss of passport

It can be quite stressful if you lose your passport while traveling. While arranging for a duplicate of your passport would certainly be a bit of an inconvenience, it also comes at a significant expense. Most travel insurance policies take care of the latter as they cover the cost of arranging a new passport. Some policies also cover the cost of arranging a duplicate international driving license up to a certain limit if you lose it during your trip.

Personal responsibility

It can be difficult to understand the law of the land in a foreign destination. If you cause damage to someone or their property due to an accident, you may have to pay substantial financial compensation to the affected party. It can range from something really minor to something quite serious. Your travel insurance policy may cover costs paid to a third party in an event like this.

Bottom row

Travel insurance often comes with other benefits depending on the insurer you choose and the plan you choose. For example, there may be a kidnapping disaster benefit that pays you for the suffering you suffer, or compassionate visit cover that pays for the return ticket of a family member to visit you in the foreign country if you are hospitalized during on your trip. There’s also an emergency cash advance cover option, which provides you with a cash advance to cover your travel-related expenses in case you lose your wallet while traveling due to theft or robbery. Visa Refusal Cover pays for the refund of the visa fee if it is refused through no fault or negligence on the part of the insured.

Buying a travel insurance policy is highly recommended as it is the shield you need in an unknown land. However, always remember to do your research and choose the policy that properly meets your needs and adequately protects you. With that sorted, you can focus on relaxing and enjoying the ride!