Traveling the world is exciting, but it can also be perilous. Whether it’s for vacation or for business, everyone can agree that traveling is so much better if you don’t have to nurse nagging fears about the unexpected. The risk each traveller is subjected to during their journey differs from one situation to the next. The value of your luggage, the refundability of your ticket, your destination, your tour company, as well as your physical condition at the time of the trip may play a role on the potential losses you may incur. Travel insurance is a kind of insurance policy especially made to protect against these risks. There are different categories, which could be classified according to the situations they cover, or how they are purchased.
Here are three general types of travel insurance according to how it is purchased, which basically depends on the duration of your trip:
• Single or Per-Trip Travel Insurance is usually arranged at the time of the booking of a trip and covers only exactly the duration of that trip.
• Multiple Trip Travel Insurance provides protection for multiple trips during one year, but none of the trips must exceed 30 days.
• Annual Travel Insurance provides coverage for a full year like multi-trip, but without the 30-day limit.
Classified according to coverage, travel insurance has more variety. The number may vary according to the insurance provider, but we have listed down the most common ones below.
Types of Travel Insurance (According to Coverage)
People often think of travel insurance as one package plan. This isn’t necessarily so. While travel insurance usually does come offered in a bundle, there are actually more clear-cut categories under it.
1. Travel Insurance Package/Comprehensive Travel Insurance
Comprehensive travel insurance is what most people mean when they say simply say travel insurance. It delivers coverage for trip cancellations or delay, medical emergencies, evacuation, lost or stolen, and delayed baggage, AD&D (accidental death and dismemberment) – the whole enchilada. This type of plan is the most popular since it is inclusive of everything most travellers would need and is ideal for family trips. Of course, you must still read the fine print when getting this plan since not all insurance providers are the same.
2. Trip Cancellation Insurance
Trip cancellation insurance covers you in the event that you or your traveling companions need to cancel, interrupt or delay your trip. Insurance companies may differ in terms of which reasons are acceptable. It's fairly typical for this policy to cover cancellation or interruption due to sudden business conflicts, delay in visa processing, and weather-related issues.
Some plans may also include additional coverage, which would insure you against terrorism, accident on the way to the airport, or if the tour company, airline, or cruise line going out of business
3. Travel Medical and Major Medical Insurance
Both of these policies provide medical protection should you become ill or injured while abroad. These types of insurance can help you cover medical expenses and locate doctors, hospitals, healthcare facilities as a regular health insurance would. The only difference between these two types of travel insurance is the duration of coverage: travel medical insurance is short-term, while major medical insurance is for longer trips.
4. Evacuation/Medevac Insurance
Medical evacuation plans or medevac provide coverage for emergency evacuation and transport to medical facilities. This is extremely useful should you become stranded in a remote rural area without easy access to needed facilities.
5. Travel Accident Insurance
Travel accident insurance is a policy which focuses on AD&D (accidental death and dismemberment). This disburses benefits to a traveller’s beneficiaries, as with regular life insurance. Benefits are paid out in the event of an accident resulting in death or serious injury to the insured.
6. Specialty Plans
Specialized travel insurances exist for specific risks a traveller may be concerned about. It is usually purchased separately, as it is an insurance that is made specifically to cover situations which regular people may not need. Corporate kidnap, ransom and extortion coverage, and car rental coverage are some examples.
Be wary of travel insurance companies that overprice their policies. There are online calculators available for you to calculate daily travel insurance rate to see if you’ll be paying too much per day.
Remember to always do research on the companies you are looking to buy insurance from, regardless of type. Being covered by a trustworthy firm is important especially when you’re overseas, where it’s harder to get help on your own.