Five Things to Know Before Buying Travel Insurance
Travel insurance covers an incredible amount of accidents that could happen to you on holiday. Take, for instance, the British couple that got a full payout because a monkey broke into their hotel room and stole their clothes while they were on holiday in Malaysia. Yes, ‘Monkey Theft’ is covered!
Before you rush to buy the first Travel Insurance you see, make sure you know what to look for in Travel Insurance policies. For starters, while it might be convenient to add on insurance while booking your flight, more often than not, the insurance that comes with flight tickets only covers you for the duration of the flight. This means accidents in the airport may not be covered, like falling while walking to board the plane.
Single vs. Annual Plan: How often do you travel?
Based on cost, if you travel twice or more a year, it is cheaper for you to purchase an Annual Plan package. This is because a Single Trip package, defined as a return trip, can insure you for up to 30 days at a single destination for about RM 41. However, an Annual Plan package will only cost you about RM 108 for 365 days, worldwide. While pricing strategies may differ for different insurers, the general rule of thumb is, if you travel more than twice a year, get an Annual Plan.
Individual vs. Family Plan: Who are you responsible for?
There are generally three broad categories of packages when it comes to who is covered. There is the Individual Package, which covers only one person who is between 18 to 70 years old. There is the Spouse Package, which covers two people legally married to each other in the country of issue, between 18 to 70 years old. Then, there is the Family Package, which is the spouse package plus a maximum of 4 children, defined as being between 30 days to 17 years old. What makes the Family Package attractive, however, is that it allows coverage for children who are 18 to 25 years old, provided they are full-time students and unmarried.
These three packages are therefore comprehensive enough to cover all immediate family, depending on who you are responsible for. In terms of cost, a basic Individual Annual Package costs about RM 108, while a Spouse Annual Package costs RM 216. The Family Package, however, costs only RM 264, which makes it an incredible value for money investment for up to 6 people in the family!
Destination: Where are you going?
Where you are going matters. If you’re buying a Single Trip Package, all you need to do is: key in the destination & layover countries and you’re covered! However, if you’re thinking of an Annual Plan and aren’t sure where you’re going yet, then know that prices vary across regions. For Malaysia insurers, the regions can be categorised as such:
Domestic (East & West Malaysia)
Asia Pacific (SEA, Australia, etc)
Worldwide (excluding USA & Canada)
Worldwide (including USA & Canada)
Most people don’t usually buy insurance when travelling domestic, as a combination of their flight insurance, medical and life insurance usually provides sufficient coverage. Hence, focus on the other three regions, which are the Asia Pacific, Worldwide (excl. USA & Canada) and Worldwide (inc. USA & Canada). On average, the Worldwide (excl. USA & Canada) plan is sufficient for coverage.
However, if you are planning to go to USA & Canada, it is absolutely crucial to cover yourself, as the healthcare costs in the United States are obscenely high. The premiums to include USA & Canada under your plan, however, are relatively low, costing between an additional RM 40 to RM 100.
Duration: How long will you be there?
If you subscribe to an Annual Plan Package, you can disregard this consideration as you’re covered for 365 days! If you’re thinking of a Single Trip Package, then you’ll need to plan accordingly for the duration of your trip. The minimum amount of days covered is 5 days. The next duration bracket varies according to insurers. For example, some price by week up to 31 days (i.e 4 weeks), after which you pay by the day! As you can imagine, this can quickly rocket costs.
Thus, it’s important to plan wisely, and make sure to factor in flight and layover durations as well. The rule of thumb here is that the longer you travel, then the more it’ll cost you on a Single Trip.
Coverage Amount: How protected do you want to be?
In general, the coverage amounts you should be concerned about are Medical Expenses, Medical Evacuation & Repatriation, Personal Accidents and Loss of Belongings. These four categories can be financially devastating if not insured. Most insurers will have a selection of packages based on your budget. The rule of you get what you pay for applies here - the higher your insurance premium, the higher your coverage amount.
For example, HLMT’s Basic Package costs RM 108 a year and covers up to RM 150,000 in overseas medical expenses. Their Elite Package costs RM 189 a year and covers up to RM 500,000 in overseas medical expenses. That’s an additional RM 89 to 3 times the coverage! Check out Qompanion’s Comparison Tool for a more comprehensive overview of different insurers and packages.
Bonus: Additional Tips
Buy only from a reputable provider. If it’s on Qompanion, you can trust it!
For Single Trip Packages, buy the policy around the same time you buy the tickets.
Study the payout terms. Some insurers reimburse rather than cover on-the-spot.
Many policies do not cover accidents that happen under drug and alcohol use. This means that even if drug use is legal in the country you’re visiting, you may not be covered. So always party safely, and limit the use of intoxicants wherever possible!
Remember, insurance is a way to make sure you’re covered so you can have fun and enjoy your vacation without any stress. Enjoy your holidays and don’t forget your passport!