About 2.5 cr Indians travel abroad each year to holiday, according to data from The United Nations World Tourism Organization (UNWTO). A multiple times that number travel on a vacation within India. But most of us don’t prioritize travel insurance, and are often unaware of what it covers. Here’s a brief look at the kinds of travel insurance policies available in India-
Basic travel insurance policy – This usually covers expenses related to emergency medical care and loss of belongings
Domestic travel insurance policy – This takes care of most accidents that occur while travelling within India. It also reimburses transportation and medical care costs arising due to hospitalization
Overseas travel insurance policy – Apart from emergency medical care costs, this covers loss of passport, documents and baggage. It also covers fraudulent charges made on your credit/debit card
There are also travel insurance policies that cater to Indians studying abroad. This usually protects a student from study interruption, health cover, sponsor protection, and compassion visits
Certain countries will require that you have purchased sufficient coverage should something happen while you are traveling to that country. Those governments do not want to be burdened with the costs of your medical care and require you to have a suitable plan meeting certain minimum requirements. For example students traveling to the USA are required to have a coverage during their period of study. Depending on the length of stay, travelers to countries in the Schengen area are required to have sufficient insurance at the time of their visa application. Health insurance is mandatory for visitors to enter the UAE (Dubai, Abu Dhabi etc). Companies running group tours often require insurance, as do many cruise companies.
Travel insurance can usually be arranged at the time of the booking of a trip to cover exactly the duration of that trip, or a “multi-trip” policy can cover an unlimited number of trips within a set time frame. Some policies offer lower and higher medical-expense options. The higher ones are chiefly for countries that have high medical costs, such as the United States or EU while Asean countries in comparison will have lower premium.
Insurers use some personal information, other than the cost of your trip, to calculate the cost of a plan:
- Age of the travelers
- Number of travelers
- Length of travel
- Type of coverage
The age of the travelers is considered one of the most important of the four factors. Typically, a traveler over the age of 65 can expect increased rates while minors may be added to the plan at no additional cost, or at a lower rate depending on the travel insurance company.
The common exclusions in travel insurance policies include pre-existing medical conditions, unlicensed operation of a vehicle, travelling for the purpose of receiving medical treatment, elective surgery or treatment, or injury or illness caused by alcohol, drug use, or reckless behavior, including engaging in some sporting activities. Events arising from war and terrorism are usually excluded, but most policies allow trip cancellation arising from war or an act of terrorism that meets the policy’s criteria.
Sabyasachi Paul has been associated with equity research and advisory on equity markets in India for over 10 years & currently heads the equity research desk of Eastern Financiers Ltd, Kolkata. He also manages a portfolio on the online platform Kristal. Find link to the strategy named ‘The Tortoise’