Holiday travel insurance
Life is full of unexpected events and to secure ourselves from such misfortunes we need insurance. There are various policies available for safeguarding us against the risks to life and our belongings.
Holiday Travel Insurance is one of its kinds that makes your travel safe and happy. For the people who plan a holiday trip aboard and for them who travel frequently, Travel Insurance may prove to be a wise option.
One may be doubtful in getting travel insurance because it may be a waste of money for him but to foresee the events of life is not in ones hands. You may never know in what kind of painful circumstances you may get stuck into while on a holiday trip. Thus spending a few hundreds of dollars on a policy that gives you peace of mind can prove to a good option.
Types of travel insurance
There are different types of Travel Insurance policies available in the market at present. These policies can be classified manly in following categories:
* Bundle
* Custom
* Flexible
Bundle Policies -
Bundle Policies contain all the important aspects of a travel insurance policy. It typically consists of trip cancellation, baggage loss, accidental death, emergency medical evaluation (medevac) etc. But these types of policies are more expensive than other travel insurances.
Custom Policies
These are those policies where you make the policy suitable for your needs of life if you want to get insurance for Medical Evacuation or specialized activities like rock climbing, scuba diving etc., you can add it to your travel insurance policy.
Flexible Policies
These policies are those Bundle travel insurance policies which tend to be cheaper than a typical Bundle Policy. For example, if a trip requires you to deposit a non-refundable amount, with flexible travel insurance, you can cover only this particular amount rather than the cost of the whole trip.
* Sources of travel insurance
Wholesale or Retail Insurance
When you buy a travel insurance policy, the premium you pay gets allocated in several different ways. A typical
$50 premium gets spent something between $5 to $15 for commission, $5 for advertisements and selling costs, around $20 for administrative costs, $5 for profits, and $5-$15 for actual risk/benefit coverage.
A Retail Insurance policy is that insurance in which you fill out a special insurance application form, and pay the premium directly to the insurance company, and get a certificate of insurance from them.
A Wholesale policy is that where a tour operator groups together many insurance policies. By this kind of policy the tour operator insures all the people traveling on that particular trip. The benefit of a Wholesale Policy is that the administrative costs goes down to 2% or less against the premium you pay, by this your actual risk/benefit coverage increases something between 50% to 70%, more than double the benefit you get in a retail policy.
Real Insurance or House Insurance Policies
A Real Insurance policy is that which you get from a Travel Insurance Company. Sometimes the cruise lines or tour operators offer their own house insurance policies which cover the cancellation fees of your tour with the company. Although, house insurance policies may seem to be less expensive but the policy offered is rarely a good value.
Annual or Single Trip Policies
Mostly travel insurances are offered for a single upcoming trip. However, Annual Travel Insurance policies are also offered which cover you for a whole year. It depends on your traveling needs whether to buy a single trip or an annual policy. If you have some trips lined up for you in the coming twelve months, Annual Trip policies can be a good offer.
*Types of coverages
Travel Insurance companies provide at least following types of coverages, intended for different types of travelers and trips:
Trip Cancellation and interruption Insurance covers the cancellation or refund penalties and the cost of coming back if you cancel your trip, or cut it short, for specified reasons. But it may not always cover all your cancellation costs. For example if you are on a restricted airfare costing $600, and a total package costing $900 per person, then if you have to come back for a family emergency, you might be getting the cheapest urgent return air ticket costing $1000, that is even more than the entire package cost. You might have to bear the cost of this urgent air ticket on your own.
If you have to interrupt or delay your trip due to some reasons which are under your own control, the insurance policy may not compensate you against this. For example, if your boss asks you to delay your trip because of some crisis in the office, you might not get a penny from the insurance company for this type of interruption caused to your trip.
Comprehensive Travel Medical Insurance is for those who dont have a medical insurance at home. Comprehensive Travel Medical Insurance is mainly of interest to those long term travelers who are working outside of their country or who have lost their medical coverage at home.
Emergency Assistance cover offers medical assistance during the travel abroad if any medical emergency arises. All expenses on your emergency assistance are taken up in the cover but it does not cover all types of medical emergencies. Suppose, if you have injured yourself during rock climbing, scuba diving, bungee jumping or other such kind of adventure activities, you would not get any financial aid from the insurance company because of specific policy provisions.
Medical Evacuation (medevac) covers the cost of air ambulance, attending physician and nurse etc. if you are so badly injured, or ill, that you are to be brought back on a stretcher. Medical Evacuation insurance is quite expensive but rarely proves to be a necessity. Most of the times after an emergency treatment, even badly injured people manage to board on regular flights.
Supplier Default Insurance covers the risk of compensating yourself if the tour operator company goes out of business. This type of cover is not often provided by the supplier against their own bankruptcy. So buying a policy from a travel insurance company may be a better option but even these companies have mostly pulled back on offering insurance against supplier bankruptcy after 11 September 2001 terrorist attacks.
Terrorism Coverage offers the coverage relating to terrorism but that too with some specific conditions. After 11 September 2001, there has been cancellation due to the terrorist threats/acts and most of the policies do not cover this sort of cancellations.
* Tips for choosing a suitable travel insurance policy:
To get an economic and comprehensive travel insurance coverage, few points need consideration:
Review your Existing Insurance Policy
If you already have coverage for lost luggage in your homeowners policy, you can exclude this from your Travel Insurance Policy. Similarly, if your health insurance policy also covers your medical expenses while traveling overseas, you can cut it off from your Travel Insurance. This will make your trip equally safer with cost effectiveness but opting for a policy that is less expensive that does not offer the coverage which you really need, is not worth considering being half insured is false economy.
Know what is the Best Insurance
Know what type of insurance is best for the trip. It is dependent on ones age, health, place of travel etc.
Read the fine Print
One should know about the things like international coverage, emergency assistance, medical evacuation, cancellation/interruption cover etc. In addition to this, coverage offered should be read in detail.
The cost of premium for a Travel Insurance is insignificant compared to what you can get in times of crisis, during a tour aboard. You may feel like wasting money on Travel Insurance but sometimes it can make you safe from some worst experiences of life.
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