Before you provide response to this question, you need to ask yourself the following:
- What could go wrong while you are on your trip?
- Do you have any medical insurance to cover your emergency medical bills in the event of accident while overseas?
- If no, will you be in the position to finance all your emergency medical expenses while overseas?
- What will happen to your family in the event of temporal or permanent disability (death)?
This article will help you know more about travel insurance and its benefits to travellers.
What is travel insurance?
Travel insurance is a type of insurance policy designed to cover travellers against any emergencies as they travel overseas either for business or pleasure. The insurance provides cover for accidental death and permanent disability, medical emergency services, repatriation, hospitalisation, hijack and loss of personal baggage. The policy can be extended to cover trip cancellation or interruption at an additional cost. This policy does not provide cover for inland travels either by air or by land.
For example, travel insurance cannot be issued to a businessman travelling from Accra to Kumasi by air. The appropriate policy to purchase is personal accident policy. Insurance companies in Ghana are considering to design a specialised travel insurance policy for inland travels. Limit of coverage is almost the same for all insurance companies that underwrite travel insurance policy in Ghana.
When does travel insurance policy begin and end?
Travel insurance policy begins from the date the traveller departs from his or her home country or the start date stated on the policy document. The policy ends on the date the traveller returns to the home country or the end date stated on the travel document. Travel period can be days, weeks or months. Annual travel insurance policy is normally issued for only frequent travellers who will be travelling to different destinations or countries within the year.
What does travel insurance policy cover?
- Medical expenses cover
Travel insurance policy provides cover for emergency medical treatment to travellers while overseas. It provides cover for both temporal and permanent total disability (death) as a result of an accident. Permanent total disability is permanent total disablement which entirely prevent the traveller from engaging in any kind of occupation. The limit of cover provided by most insurance companies in Ghana is €30,000.
- Hospital benefit
This is an extra benefit payable to the traveller when he or she is admitted at the hospital as an in-patient. This benefit is different from the medical expense cover explained earlier. This is to cover any extra expenses that the traveller might incur as a result of him been hospitalised. Examples of such expenses are cost of food, Internet data, credit for phone calls, etc. In Ghana, most travel insurance underwriters provide hospital benefit of €82 per day, up to a limit of €840.
- Luggage and personal belongings
Travel insurance policy also provides cover for loss of luggage or personal belongings of travellers as a result of an accident. Average limit provided by local insurers is usually €64 per person.
- Repatriation after treatment
In the event of an accident or sudden illness or death, the travel insurance policy covers repatriation of the traveller to their home country. This will cover one relative who is required on medical advice to travel with you.
- Hijack benefit
Hijacking refers to an unlawful seizure or taking control of an aircraft while it is in transit. Travel insurance policy provides a fixed amount of benefit to the travellers, which is paid within every 24 hours.
Does travel insurance policy cover all emergencies and illness?
Travel insurance policy, like many other general insurance policies, have exclusions. Exclusions refer to cases which are not covered under the policy. The most common exclusions applicable to travel insurances are as follows.
Travel insurance policy does not cover:
- Illness or injuries arising from chronic ailments or those that existed prior to the inception of the policy.
- Mental health diseases.
- Sexually transmitted diseases.
- Any cardiac or cardio vascular or vascular or cerebral vascular illness or conditions.
- Loss that occurs as a result of a bad faith by the traveller for participating in any criminal act.
- Events arising from terrorism, mutiny or crowd disturbances.
- Wars, with or without prior declaration, and any conflicts or international interventions using force or duress or military operation of whatever type.
- Permanent resident and students outside the resident country.
- Pregnancy or child birth-related cases.
What details do insurance companies require in order to enable them issue travel insurance policy?
Key information needed to underwrite travel insurance policy are:
- Name, address, and phone number of the traveller.
- Passport number.
- Details of Next of Kin, including phone number.
- Age or date of birth of the traveller.
The age of the traveller is very important in determining insurance premium. The age limit for most insurance companies in Ghana is sixty-five (65) years. Travellers who are above this age are charged over-age loading which increases the price they pay for their insurance. It can be purchased for both infants and adults.
- Occupation of the traveller. Occupation is an important rating factor for travel insurance. Insurance companies do not provide cover for travellers who are engaged in any professional sporting activities.
- Travel period. The period of travel requested by the traveller is key in determining insurance premium. Travel period can be days, weeks or months. Most travel insurance underwriters in Ghana do not provide cover for more than three months because of the immigration laws that exist in the various destination countries.
- Countries of destination and destination address.
Countries of destination is also a key requirement when patronising travel insurance. Most insurance companies charge high risk loading for travel to countries such as USA and Canada because the high cost of diagnostic and surgical procedure in those countries. It is also possible to get a worldwide travel insurance cover depending on your travel plans.
- Declaration of any existing medical condition.
How do I buy travel insurance policy?
The most common channels available to purchase travel insurance policy are:
- Buying the policy directly from the insurance company
Travellers can purchase their travel insurance policy by contacting insurance companies directly. This can be done through phone calls, emails or a visit to the insurance company’s physical office.
- Buying the policy through an insurance broker or agent
Travellers can also purchase travel insurance policy through insurance brokers. Insurance brokers are independent intermediaries who can assist you to purchase your insurance package from any insurance company of your choice. Most corporate organisations use the services of insurance brokers because of the extra professional services they provide. Accredited agents of a particular insurance company can also be used.
- Bank assurance
Travellers can also buy travel insurance policy through their banks.
- Other digital platforms
Some insurance companies have designed digital platforms and mobile applications that enable customers to purchase travel insurance and other insurance policies at the comfort of their homes.
How much does travel insurance cost?
Cost of travel insurance varies from one company to the other depending on the package provided. In Ghana, the average price for one month travel insurance to any country in the world is GH¢396.
How do I make a claim under my travel insurance policy?
The claims process for travel insurance policy is the same for all other general insurance policy. The claim processes are claims notification, claims assessment, accepting or denying liability, and claim payment. Insurance companies in Ghana have partnerships with foreign medical institutions who manage travel insurance claims on their behalf.
The claims processes are highlighted as follows:
- Claims notification
The first step in making a travel insurance claim is to notify the insurance or the appointed service provider of the accident. This can be done through phone calls, emails, and completion of claim form. All necessary medical report and medical bills should be submitted to the insurance company or the service provider. The contact details of the service providers are provided in the policy document.
- Claims assessment
The next stage is for the insurance company or the service provider to assess the cause of the accident to determine if it is covered under the insurance contract.
- Accept / deny liability
The insurance company accepts liability if the cause of the accident is covered under the insurance contract. They will deny liability if the cause of the accident is not covered under the policy.
- Make claims payment
After assessing the cause of the accident and accepting liability, insurance companies either pay the claim amount directly to the traveller or to the medical service provider.
Conclusion
Travellers must consider the risk and its associated cost in the event of emergencies before making a decision to either purchase or not to a purchase travel insurance policy. If you stand in the position of being able to pay for the cost or have an existing medical insurance policy to cover all the risks, then you can forgo travel insurance. On the other hand, if you are not in the position to provide for the cost, then travel insurance is the best option to undertake. It will provide you with peace of mind.
>>>The writer is a chartered insurance practitioner and an Associate of the Chartered Insurance Institute of UK. He also holds a professional qualification in Risk Management (Associate in Risk Management -ARM) from the American Insurance Institute. He is currently pursuing his CPCU designation with the American Insurance Institute and an MBA (Finance) programme with University of Ghana Business School. He has over nine (9) years’ experience in insurance, reinsurance and risk management. He can be reached via +233249236939 or [email protected] / [email protected]
