Ensure your travel insurance meets your needs

Travel insuranceWhile attending a business conference in Guangzhou, China, Mrs Sithole collapsed and was rushed to the intensive care unit of a local hospital with cerebral bleeding. She was diagnosed with an aneurysm and was hospitalised in China for four and a half months. Her travel insurer, TIC, covered her hospital stay and paid for her aunt’s travel and accommodation expenses so that she could stay in China at the patient’s bedside for three months.

Sithole was eventually airlifted to Centurion where she died from multiple organ failure a month and a half later. The total cost of her travel insurance claim was R4.5 million. Noel Joseph, TIC claims manager, says, “The cost implications of the rand/dollar exchange rate are astronomical and this case illustrates the absolute necessity of having adequate travel insurance cover.”

Simmy Micheli, manager of sales and marketing at Travel Insurance Consultants (TIC), says there are many benefits on a travel insurance policy. “The heartbeat of travel insurance is the medical cover where we pick up medical costs in foreign currencies. What seems to be a simple claim can quickly become complicated, racking up huge medical bills. For example, we had a recent claim in Switzerland where the client fell ill with pneumonia and passed away – the total claim amounted to R1.4 million,” she says.

Read the fine print

While you might have automatic travel insurance benefits when you pay for your trip with your credit card, you should always read the fine print to make sure that you know what you are covered for. For example, if you have used frequent flyer miles accumulated via your credit card to fund a trip, then you do not qualify for automatic travel insurance. Pre-existing conditions are not covered but you have the option to take up additional cover for this.

The complimentary travel insurance offered by banks when you pay for your travel using your credit card is usually limited to some medical cover, accidental death and disability cover. The majority of travel insurance claims are related to medical costs, cancellation expenses and luggage losses. You can add top-up cover to the free basic insurance that your bank offers you but it will often work out cheaper to simply take out a comprehensive specialist travel insurance policy. Micheli notes that when you compare different policies and benefits, it is important to check that you have cover for all three risks.

You are also likely to find that the automatic travel insurance linked to your credit card has a low limit, such as R150 000, and usually only covers emergency medical treatment and personal accident cover.

Other common exclusions include any hazardous sports or activities, consequential financial loss, war and terrorism, mental disorders, yuppie flu, and employment involving manual labour. Note that leisure sports are usually covered while organised sports or professional sports can be covered by special arrangement.

Top tips

Use these tips to ensure you get the best benefits out of your travel cover:

  • You must purchase your travel insurance before you leave. However, you can extend your policy while travelling, on condition that you contact your travel insurer while the policy is still in effect.
  • Find out what the exclusions are on your contract. Common exclusions include accidents that take place while you are participating in hazardous pursuits, speed or endurance activities; any injury resulting from your own negligence; self-harm; and illnesses or injuries sustained during illegal activities.
  • Before you travel, find out what vaccines or shots you need to have. You may find that some vaccines may not be compulsory in order for you to enter another country but, for example, if you don’t take a malaria vaccine and you contract malaria, your travel insurance may not cover you. Micheli says, for example, TIC, does not deny benefits if a traveller has not taken their malaria medication. “This is an important question to ask because we have found that 50% of business travellers travel into Africa and other travel insurers do withhold benefits if malaria meds or vaccines are not taken.”
  • If you lose your luggage, cash or any documents while travelling, you need to obtain a written police or airline report as soon as possible.

Read more of Neesa’s columns at www.moneyissues.co.za