10 tips on buying travel insurance plans

Travellers should ensure that the travel insurance covers certain categories of people - senior citizens (above 75 years), young children (below six months) or someone with special needs, for example, a pregnant woman.
Travellers should ensure that the travel insurance covers certain categories of people - senior citizens (above 75 years), young children (below six months) or someone with special needs, for example, a pregnant woman. ST PHOTO: CAROLINE CHIA
NTUC Income's Ms Annie Chua suggests buying travel insurance early to protect against loss should a travel agency go bust.
NTUC Income's Ms Annie Chua suggests buying travel insurance early to protect against loss should a travel agency go bust.
Sompo's Ms Koh Yen Yen recommends higher medical expenses coverage for travel to places such as Japan and the US.
Sompo's Ms Koh Yen Yen recommends higher medical expenses coverage for travel to places such as Japan and the US.

1. Policy coverage and exclusions

Price should not be the only determining factor in purchasing travel plans, advised Ms Annie Chua, NTUC Income's vice-president and head of personal lines.

"(Travellers) should look at the types of benefits and the coverage which are most important and relevant to them, as well as consider any exclusions and claim limits for each benefit," she said.

A good example is coverage for pre-existing medical conditions, which include common ailments such as hypertension, asthma, high cholesterol and eczema. These are typically not covered in travel plans and if travellers without this cover require treatment overseas, the cost is usually very high, Ms Chua added.

Mr Derek Low, Liberty Insurance's executive vice-president for personal lines, suggested that customers ask themselves if the policy is comprehensive enough, given the purpose of the trip.

For example, if a person is planning adventurous or dangerous activities, such as white-water rafting or mountain climbing, it is important to check whether the travel insurance covers such activities.

 
 
 

For unforeseen political threats, Sompo Insurance Singapore's chief distribution officer Koh Yen Yen suggested that customers look for plans that offer full terrorism cover that includes chemical, nuclear and biological terrorism.

2. Adequacy of sums insured

Mr Low said that this will vary, depending on whether it is a basic or superior plan. If travel is to an expensive or far-flung destination such as Europe and the United States, a superior plan with higher sums insured is recommended.

Ms Chua said the individual needs of the insured person, along with the airline carrier or other modes of transport that he is taking, as well as the destination itself, will all have a bearing on the choice of a basic or superior plan.

A good way to assess the level of coverage needed is to gauge the potential expenses or financial losses a traveller has to incur if he does not have travel insurance, she added.

Travellers going on a self-drive trip should look for a plan that offers rental vehicle excess coverage, Ms Koh advised. This benefit is not in Sompo's basic Vital travel plan but it is offered under its superior Elite and Deluxe travel plans.

For personal accident coverage, she reminds travellers to compare the premium against the coverage. By paying a slightly higher premium with another insurer, the personal accident coverage could be significantly higher.

3. Medical expenses, evacuation and repatriation

Many people think that travelling in Asia would not require high-level medical expense coverage. However, for Singaporeans used to the quality of care here, many may end up opting for foreign-run hospitals or clinics when they require medical care in some parts of Asia.

Such treatment may cost 10 times more than the same procedure at a public hospital in order for a patient to have access to better medical facilities and internationally qualified medical personnel.

Hence, you may want to consider a plan that adequately covers the high medical-care expenses in foreign-run hospitals or clinics.

"Higher medical expenses coverage is recommended for travel to countries such as Japan, the US and Europe where medical treatment costs are higher. In any event, please ensure that the policy provides sufficient medical evacuation or repatriation coverage to transport one back home or to a hospital better equipped to render the treatment," said Ms Koh.

In addition, check and compare the medical expenses coverage and the duration offered on return to Singapore. Some policies provide a much-reduced coverage unless evacuation is required.

4. Trip postponement or cancellation

If there is an outbreak of infectious disease such as the recent Zika virus saga, check if the travel policy provides coverage for trip postponement or cancellation should policyholders and their family members contract the disease.

5. Persons travelling with you

Ensure that the travel plan covers certain categories of people - senior citizens (above 75 years), young children (below six months) or someone with special needs, for example, a pregnant woman - if they are travelling with you. Some insurers do not provide emergency-assistance cover for people above 75.

6. Travel duration

It is prudent to ensure that the trip does not exceed the maximum duration imposed under the policy. For example, some policies may limit the coverage to 120 days per trip, advised Mr Low.

7. Closure of travel agency

For those who prefer to get a travel agency to do all the planning, it is essential to ensure the policy covers the financial collapse of the travel agency. The policy should cover the loss of pre-travel cost or additional expenses incurred if the trip has to be curtailed.

Both Liberty and Sompo provide this feature in their travel plans.

Read the fine print to ensure that the amount of coverage is sufficient and find out if there are other conditions on the type of travel agencies covered under this benefit, said Ms Koh.

8. Buy travel insurance as soon as you book your trip

Both Ms Chua and Ms Koh noted that most people tend to purchase travel insurance only in the last few days before travelling.

Ms Chua said that a good practice is to buy travel insurance once your trips are confirmed and the moment air tickets and accommodation overseas are reserved.

"This ensures that travellers are covered for trip cancellation due to unforeseen circumstances, including death or serious illness/injury of the insured, their family members or travelling companions. If travel insurance is purchased after such incidents have happened, the trip cancellation will not be covered.

"For those who booked tours through travel agencies, buying travel insurance early ensures that they are covered for what they have paid in advance should the travel agency cease to operate," she said. Over at Sompo, 60 per cent of its customers buy insurance less than 30 days before their trip starts.

"Most travellers are not aware that they are covered for up to 60 days before trip commencement such as trip cancellation due to natural disasters, unexpected outbreak of strikes, and riot and civil commotions, the financial collapse of travel agency, and death, serious sickness or injury of the traveller or family members. Thus, it makes sense to buy the policy once the trip is confirmed, to fully benefit from the coverage," said Ms Koh.

9. Annual or single-trip plan

If you travel frequently, consider taking up an annual policy which allows unlimited trips within a policy year, rather than buying single-trip policies, said Mr Low.

10. Reputation

Mr Ignatius Chng, AIG Asia Pacific's vice-president of personal insurance, pointed out that travellers should look for a reputable insurer which provides 24-hour worldwide assistance, with crisis-response capabilities and the ability to process claims quickly.

Lorna Tan

A version of this article appeared in the print edition of The Sunday Times on November 27, 2016, with the headline '10 tips on buying travel plans'. Print Edition | Subscribe