Travelling with Peace of Mind
You have bought your tickets, planned your itinerary and booked your accommodation. Are you ready to embark on your holiday? If you have answered yes, think again. Have you purchased your travel insurance yet?
Singaporeans love to travel. We take it for granted that our holidays abroad will be hassle-free, fun and relaxing. Yet every year, thousands of travellers find themselves in some difficulty or other while overseas. Medical expenses comprise a large proportion of travel insurance claims. Other common claims are for lost or stolen baggage and/or other personal belongings, baggage delays, flight cancellations or delays, missed connections and trip cancellations due to death or illness. Without travel insurance, travellers are personally liable for such expenses.
Travel insurance offers protection to deal with a range of events. Here are some key benefits:
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Benefits
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Examples of coverage
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Medical Expenses
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Medical bills, hospital allowance, emergency medical evacuation and repatriation.
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Personal Accident
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Accidental death and permanent disability.
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Travel Inconveniences
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Loss or damage due to baggage loss or delay, travel delay or cancellation, loss of travel documents and missed travel connections.
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Many insurers now offer a 24 hour emergency and assistance hotline. Emergency services include medical assistance, emergency evacuation, hospital deposit guarantees and travel assistance due to loss of passport.
Your credit card may provide you with some form of ‘free’ insurance. However, be sure to check what is covered and what isn’t. You should also find out if an "excess" will be applied to the benefits. For example, policy-holders may be liable to pay a fixed amount before claiming the difference for certain benefits. In addition, you should find out the extent of the coverage the policy provides. Don’t just buy the cheapest travel insurance available. It may not actually suit your needs nor offer the level of coverage you need. Here is a list of things you should consider when buying travel insurance.
1. Think about your needs
If you plan to engage in leisure or sporting activities such as scuba-diving, hot-air balloon rides or snow sports, you should shop around for a comprehensive policy that extends cover for such activities. Or if you are planning to travel to a hard-to-reach destination such as in the Himalayas, you may want to check whether the travel insurance policy you are considering will cover your medical evacuation from such a location.
2. Know what is and what is not covered
It is important that you know what the policy covers, the extent of coverage as well as what is not covered. Take the time to read the terms and conditions, especially the exclusions, carefully. For example, some dangerous or higher-risk sports may be excluded from coverage. Pre-existing conditions are also generally not covered in most policies.
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Scenario
While in China for a holiday, Mrs Tan suffered a stroke and was immediately admitted to a local hospital. The hospital’s doctors diagnosed that she had suffered from a brain haemorrhage due to the stroke. She was operated on immediately. After a two week spell in the intensive care unit, her condition was stable enough for her to be flown back to Singapore. The medical and hospital expenses as well as evacuation proved substantial.
Based on the travel insurance policy that Mrs Tan purchased, her overseas medical expenses were covered up to 30 days from the date of her first treatment, even though it exceeded the original period of insurance.
Important note to readers: The extension of cover beyond the original period of insurance is not guaranteed and may vary between insurers. The coverage is also subject to policy limits and terms and conditions. You should check with your travel insurance policy for full details.
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While different insurers may offer the same benefit, you may find that the coverage offered by each one differs. For example, under travel delay benefit, one insurer may pay for each six consecutive hours of delay, while another may only pay for each eight hours of delay.
If you are travelling as a family, you may want to explore purchasing a family travel insurance plan. The definition of ‘family’ may differ between travel insurers. Most plans allow for one or two adults travelling with any number of children. Some plans do not require the adults to be related, but the children must be related to one of the insured adults. Others require the adults to be legally married and the children to be the legal offspring of the insured couple. Children are generally defined as unmarried and unemployed persons under the age of 18 years old or up to 23 years old if he or she is enrolled full-time in an institute of higher learning. Do double-check these definitions in order to purchase a policy that is appropriate for your situation.
If you are a frequent traveller, you may wish to consider purchasing an annual travel insurance plan if this is more economical and covers you automatically each time you travel. Some annual plans allow you unlimited travel within the insurance period. However, there may be limitations on the maximum number of days allowed for each trip.
3. Shop and compare
Get quotes and information on different travel insurance policies. By comparing, you can identify the one which provides the most suitable coverage for you.
After purchasing your travel insurance, it is a good idea to check what documents are needed when submitting travel insurance claims. Even if you are covered, you might be unable to make a claim because you lack the necessary documents. For example, to claim for baggage loss, you will need to obtain a Property Irregularity Report or Police Report or Hotel Management Report, depending on where you lost your baggage. You will also need to submit receipts of items lost/proof of purchase.
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Scenario
During a trip to Perth, Australia, Elaine consulted a doctor when she developed a bad bout of the flu. The doctor provided her with an official receipt for the consultation charge. Then she went to the pharmacy to obtain her prescribed medicine. She was given a receipt from the pharmacy’s cashier when she paid for her medication.
Upon returning to Singapore, she submitted her medical claims to her insurer. The claim for her medication was rejected as the insurer said there was no official receipt accompanying the claim for her medication. She was told that the non-itemised receipt from the cashier was insufficient. What she needed was an official receipt which can be provided from the pharmacist upon request.
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Purchasing travel insurance is an important aspect in travel planning that should not be overlooked. While we have the primary responsibility for taking care of our own safety and that of our personal possessions, having appropriate travel insurance can help us travel with greater peace of mind.
This article is based on information provided by the General Insurance Association of Singapore and the Monetary Authority of Singapore (MAS) as part of the MoneySENSE national financial education programme.
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