Our island is tiny, and there is absolutely every reason for us to head out and explore new places ever so often, for work or for leisure. (Or in a certain Amos Yee’s case – to seek asylum and free speech)
So much so that in 2017, Singapore residents clocked a total of 9.8 million trips out of the country (1.7 trips made for every citizen. Source here).
Given our penchant for travel, it would make perfect sense for us to be well acquainted with this cornerstone of the insurance industry, so get ready for a tonne of knowledge bombs to be dropped in the next 3 minutes.
(The content for this article was kindly supplied by the General Insurance Association of Singapore, for which we are grateful)
Common misconceptions about Travel Insurance
Every travel insurance policy is the same (Not true)
Like all things travel related (think hotels and flights), travel insurance policies can vary and provide anything from basic to comprehensive coverage. Travelers should choose the appropriate level of coverage depending on their travel needs and plans.
Policies can also be customized with optional add-ons to provide additional coverage such rental car excess or loss of sports equipment. Insurers are constantly innovating and developing new options.
I only need Travel Insurance for a long trip, not a short one (Not true)
Travel insurance provides essential coverage for high impact events like medical emergencies and other seemingly simple travel inconveniences that would cause unnecessary stress and leave you out of pocket.
Statistically, there would be more things that COULD go wrong on a long trip compared to a short one, but one unfortunate moment is all it takes to ruin a holiday – or worse.
My existing insurance policies will provide the coverage I need (Not true)
Many travelers assume that their existing insurance policies providing health or personal accident coverage will suffice. However, most insurance policies have a geographical limit and may not cover claims events outside of Singapore.
Travel insurance is expensive and unnecessary (Not true)
Travel policies can go for as little as S$20 for a trip across the causeway and provide medical expenses coverage of up to S$200,000 and emergency medical evacuation services.
More often than not, there are always promotions and discounts available – especially around popular travel dates.
Top Considerations for buying a Travel Insurance policy
Now that we’ve gotten some of the bigger misconceptions out of the way, lets check out what exactly should we consider before purchasing travel insurance. The following questions (and their answers) will go a long way to helping you decide what policies best suit your needs.
Where are you traveling to?
This is by far the biggest consideration.
Some insurers do not include Japan and Australia in their Asia-Pacific coverage! It is important to take note of the geographic coverage of your travel insurance.
Make sure each country you are visiting is included in the geographic coverage of your policy. For example if your travel itinerary from Singapore to USA includes a stay in Japan, you will need to make sure both USA and Japan are in the covered regions.
The geographic coverage of your travel insurance can spell a big difference in your premiums. It is cheaper to buy a policy with territorial limits such as Asia only, than one with worldwide coverage.
It is important to note that some insurers’ geographic coverage excludes sanctioned countries.
Out of curiosity, it does seem that not many insurers in Singapore cover travel to the DPRK (North Korea). Just something to note should you want to visit supreme leader kimmie.
How frequently do you travel in a year?
Frequent travelers should consider purchasing an annual policy instead. This would typically cost less than purchasing a single trip policy each time and ensures coverage all year round.
Personally, I travel about 3 times a year, which is sort of the cut off line for purchasing an annual policy. (Yes, I calculated) If I head out of Singapore for 5 or more times, an annual policy is definitely on the cards for me.
What activities are you doing on the trip?
Higher risk activities like bungee jumping or scuba diving obviously require more cover compared to say shopping or the occasional urban hike.
It is also possible to obtain extra cover for car rentals (in case you get into an accident) and sports equipment (golf clubs, bikes and the like) that you bring overseas.
Are you traveling alone or with family?
Most insurers offer family plans which may translate to more cost savings than individual policies.
What YOU really buy Travel Insurance for
Travel insurers offer policies that provide a diverse range of benefits. Always read through the coverage terms, benefits limits and exclusions to understand what the policy covers.
A comprehensive travel insurance policy would typically cover:
Trip cancellation & curtailment
Travel inconveniences (e.g. travel delay, trip cancellations/curtailments)
Damage to or loss of baggage or personal belongings
Emergency medical evacuation
Most policies exclude coverage for certain medical conditions, specific high-risk and/or hazardous activities, natural disasters, chemical and nuclear terrorism, and wars. However, some insurers offer travel insurance that cover pre-existing illnesses.
How to make a claim
Quite literally the money question, and we saved it for the last
Insurers often have different procedures for making claims. Check your insurer’s website on its required procedure and documents for claims submission.
Generally, your insurer would require you to complete a claim form and submit it with the supporting documents (e.g. copies of plane tickets, police report, medical bills and report, carrier irregularities report, etc.)
If you are not clear on what is needed to make a claim, it is best to contact your insurer to clarify while you are still overseas. That will allow you to ask for some of the documents while you are still there.
Here’s a handy guide to help:
In recent years, there have been huge strides made by the industry as a whole to facilitate the claims process – which is definitely a boon for consumers like you and me. Strangely enough, I’ve never had the fortune/misfortune? of ever needing to make a travel claim. Touch wood!
Happy travels! – And be sure to leave any questions or comments you may have about buying Travel Insurance in the section below.
www.ClearlySurely.com aims to eradicate the knowledge gap between consumers and Life Insurance. Our Vision is that one day, every Man, Woman, and Child will be properly insured.
Kind attribution to the content of the article to Mr Ho Kai Weng, Chief Executive, General Insurance Association (GIA) of Singapore. Any errors or omissions are our own. Because we are professional in this way, obviously.