One of the things I said last time while discussing “Managing Finances while travelling” that I would be writing about saving while travelling. However, I feel I have missed an important topic, that of Insurance for travellers. Insurance is an essential aspect of travel that is needed to be discussed even before managing expenses
Colourful Umbrellas always at hand! Insurance against a rainy day!
In a nutshell, we can define insurance as a device that could protect us or our family from extreme unforeseen event of the negative kind. It could be financial, health, emergency or even death.
Alternately, one can term it as a risk mitigation option in return for a nominal amount paid as premium. The value of the risk mitigated is many times more than the value of the premium amount paid, for example, the term plan and term insurance premium calculator can assist you with estimating the premium based on your requirements, age and place.
Without going into further details of how insurance works, we see that there are many types of insurance coverage. There are insurance plans for individuals and businesses. We will restrict ourselves to individual travellers here.
Broadly two categories of insurance exist that are broadly termed as life insurance and non-life insurance also called general insurance.
In simple terms, life insurance is an agreement of a person with an insurance company where the insured person pays a pre-determined amount called the premium to guarantee payment of a pre-determined amount (death benefit), on his or her death, to the insured person’s nominee.
Types of Life Insurance: There are broadly two types of life insurance. One in which, if the insured person survives the term or period of insurance there are no survival benefits. Most of the Term policies and whole life policies fall under this category. The other type is where survival benefits accrue as a part of the premium invested in some form of equity or bond market which is returned at the end of the period of insurance. Endowment policies, annuity schemes, savings plan etc. fall under this category.
In India, the second type of insurance is quite popular even though the premiums are higher.
Why is Life Insurance important to travellers?
According to me, life insurance is one factor that ensures, the family of the insured does not feel the economic pinch when he or she is no longer around. It may sound morbid but it is a fact of life.
Health, Travel, Home, vehicle insurance etc. falls under this category.
There is a periodic or one-time payment of premium upon which the insurer guarantees payment of the agreed sum. Travel Insurance and Home insurance are perhaps, more important to us travellers, than other types.
Travel Insurance: In general, Travel Insurance covers hospitalization during travel, flight cancellations, delays and sudden change in plans, pre-existing diseases covered at no extra cost, Baggage and Passport loss, Personal Accident and Personal Liability covered and so on. Many of them also cover medical evacuation for extreme illnesses and repatriation of the mortal remains if there is an occurrence of someone’s death during travel. In fact, many countries do not give a visa if you are not properly covered. Travellers are more prone to one or more of the above situations during their travels.
However, if the traveller is involved in adventurous activities then most companies would shy away from any insurance except for a few at a high premium. I remember taking such an insurance for about 90USD for 15 days when I was out trekking to Everest Base Camp.
For travellers, I highly recommend Travel insurance that covers health and also Home insurance against burglary when you are travelling.
Home insurance is generally to insure against loss or damage of house due to fire, burglary, lightning strikes, explosion, flooding, rains, vandalism, and third party liability and so on.
As a traveller, if you don’t have anyone looking after your home while you are away, this insurance is of utmost importance. It gives you peace of mind while travelling, so much so that even if there is a total loss, you are at least covered financially.
One big advantage is that the premium amounts are very low and the insurance value is often based on self declaration. One of the reason is , the probability of occurrence of the incident is a factor for calculation of premiums. Most of the incidents covered here are of very low probability hence low premiums.
I have covered only those types and aspects of insurance that are most important and beneficial to a traveller. This is a generic treatment of the subject. However, individual circumstances may involve different mix of solutions.
Please feel free to share your views on the subject.
If you want to travel places with us, we invite you to join us on our feed or Facebook travel page.
P.S.- This article Importance of Insurance for Travellers belongs to Le Monde, the Poetic Travels, an Indian Travel Blog, by the traveling couple, Nisha & Vasudevan R. Reproduction without explicit permission is prohibited. If you are viewing this on another website rather than the RSS feed reader or www.lemonicks.com, then that website is guilty of stealing our content. Kindly do us a favour. Please visit our site and let us know. Thank you.
Right, Now a days insurance is very necessary for every person and if you want to travel in any where like; Hill station and other places so you need to this ….
And i like your information in this Article .. Thanks 🙂 Very Nice
How easy it is to claim travel insurance in your experience? Let us say you lost your wallet n all cash- can you file an FIR with police, walk into a nearby bank and get some emergency cash or you’ve to manage entire trip on your own, come back and then claim?
Also I’ve some similar umbrella photos towards the end of this post – take a look https://www.enidhi.net/2017/11/tanah-lot-balis-most-popular-temple.html
useful insurance information for traveler thanks to sharing
I always read such stuff but never do it! Except of course the IRCTC ones that happen by default.
I think someday I will have to start thinking about it.
I couldn’t agree more! As someone who travels a lot having travel insurance is a MUST! it doesnt always only cover travel issues (injury etc) it also covers misplaced luggage, passports and legal affairs as well!
Travel insurance is incredibly important. My father had emergency surgery in Spain right before he was supposed to get on a cruise ship. Without the insurance, the expense would have been horrendous.
Insurance is a smart thing to have for sure! We get it mostly just for our bigger trips that we have to book farther in advance. And of course we have life insurance and car insurance too. It’s worth it. Love your tip to have someone check on your home when gone. Great tips here.
Insurance is very useful for protecting you from life’s ups and downs. It can also be useful for tax purposes and piece of mind. Insurance is a valuable tool for everybody, especially travellers.
I don’t think I’ve ever travelled without travel insurance – but then, we are so nervous of places that might not have free healthcare I suspect most people from the UK are like me and very cautious. Similarly, I have home insurance just in case…
Great advice though and a good guide to why you should be covered when you travel
I’m touching wood now and hoping I don’t need it!
I’m always amazed at how many people travel without insurance. My feeling, for those of who are fortunate enough to travel, is that if you can afford to travel, then you can afford insurance. Even budget travellers should ensure they are covered for health at the very least, even if they don’t need cover on loss or theft of their luggage.
Travel insurance is very important. I was so glad I had it whilst traveling in Africa a few years ago when I became sick for a short time. Medicial costs were expensive but I got all the money back (and had great health care).
I am lucky that I have travel insurance included as part of medical insurance offered by my company and also the Citibank credit card that I have provides me with travel insurance. I have never considered home insurance though, it’s food for thought!
I actually just bought insurance on plane tickets for the first time… baby steps!
I am always amazed that people don’t consider travel insurance to protect their vacations. We don’t have life insurance because we have enough to cover us in the event of death. But we have had to exercise our travel health insurance several times for very expensive healthcare costs when travelling. We made sure that our home insurance included no constraints for accidents that happened when we were not at home. Insurance buys us some peace of mind. One less thing to take away the enjoyment from travelling.
You have touched such an important topic. We all travelers usually ignore the importance of Insurance. Honestly, we only have a part of it covered for us but now need to include others too. Thanks for compiling this up.
Useful information about insurance for travellers. Thanks for sharing