TRAVEL INSURANCE

Travel Insurance – an insurance that is often overlooked

When comes to insurance, travel insurance is often a policy that has been overlooked by consumers frequently, it is an insurance that provides you with protection and with peace of mind while traveling, yet, majority of travelers simply do not feel it is necessary as they trust themselves and will look after themselves when traveling.

The most important thing about travel insurance is protecting the unforeseen events, indeed, it is impossible to predict if you will get sick while traveling, if your luggage will be lost, if something will happen that delays your trip or if something happens to travel companies or airlines you are dealing with.

Once considering these factors, you will see that a lot of events are unpredictable, especially if you are traveling with a family; maybe travel insurance is needed after all.

What exactly is covered by travel insurance?

Travel insurance provides protection for the following main areas:

1. Medical expenses – travel insurance provides medical expenses while you are sick when traveling, this includes hospitalization, medical examination and medicine.
2. Loss or damage to luggage or properties – if your luggage is stolen or damaged when traveling, the insurance will pay for the value.
3. Lost tickets, emergency accommodation – in case of emergency, your travel insurance may also pick up these unexpected expenses.
4. Cancellation Fees – the definition in insurance is widely interpreted, this means, cancellation due to weather or other events, cancellations due to bankruptcy of operators was a major concern recently.

Where to purchase travel insurance?

Travel insurances are usually from 3 channels:

1. Travel agents – they will usually recommend you to take up travel insurance before you travel.
2. Directly with insurance companies, you can also purchase directly from them
3. Online – there are websites where you can apply for travel insurance directly online

Why is the insurance premium different?

Insurance premium for travel insurances varies considerably, the contributing factors are:

• Travel destination – some areas are classified as more dangerous areas; some areas may have certain disease outbreak. In many instances, travel insurance companies may put an exclusion zone on certain countries, so you must contact your insurance company to ensure they are not excluded before you take up your insurance policy.

• Duration of Travel – This will also determine your insurance premium, and also depends on how long you stay in each destination.

• Activities – What kind of activities you will be participating, many travel insurance policies will exclude any losses or damages if you engage in dangerous sports like bungee-jumping or rock-climbing.

• Insured value of your luggage and goods – there is always a limit for your insured value on your insurance policy, so if you buy an expensive item overseas and is over the insurance limit, they may not be covered when you make a claim.

Tips to choose travel insurance

Although most of travel insurance policies are provided by the major insurance companies, the coverage in each policy varies considerably.

You will also see a lot of credit cards, especially gold card or platinum cards that mention you will get complimentary travel insurance if you use them to pay for your expenses.

However, travel insurance policies offered through credit card companies maybe very different, so it is important to read the insurance policy.

Common Mistakes made when choosing travel insurance include:

• Under Insured: The values were under estimated, so comes to claim, the payout was much less than the goods value.
• Medical Expenses: Some travel insurance policies only provides coverage to certain limit, this means, extended hospitalization could result in costs from your own expenses
• Underestimate the importance of travel insurance: The biggest mistake people make are, they do not buy travel insurance at all.
• Exclusions: There are a lot of exclusions in travel insurance wordings, this can cause issues when lodging a claim, some insurance policies do not provide coverage on costs from flight cancellations for instance, some airlines will pay for the compensation already and therefore, you can not claim that from your travel insurance again.

Making a Claim

Travel insurance is different from other insurance, it is not a health insurance, and therefore, you need to pay for your medical expenses first. You need to ask the medical practitioner to produce a detailed receipt and for you to make a claim when returning to Australia.

A claim process can take several weeks before you receive the payout, depending on circumstances, the payout can be less than your medical expenses, and circumstances such as exchange rate will also affect your payout figure.

Making a claim from insurance on your lost luggage can also be a lengthy process as a lot of times; it is delayed by transit, which means insurance companies will wait for a number of weeks before ensuring the luggage is truly lost. It is a very difficult claim sometimes as it is very difficult to track where the luggage is once missing.

Flight cancellations or additional accommodation costs are relatively straight forward insurance claims, but receipts must be always kept to make a claim.

As for conclusion, when comes to travel insurance, it is better to have something than having nothing.