Travel insurance: Must-have or good-to-have?

Whether it's a weekend getaway or taking the road less travelled on a month-long adventure , planning ahead is crucial to ensure a smooth and hassle-free trip. 

An essential aspect of travel planning is purchasing travel insurance. With a plethora of options available, it's tempting to opt for the cheapest travel insurance plan available.

But is the cheapest always the best choice? Read on to learn how to make an informed decision when it comes to purchasing travel insurance and some scenarios where investing in a more expensive plan might be beneficial.

The temptation of cheap travel insurance

In today's digital age, finding cheap travel insurance is just a few clicks away. Many budget-friendly options promise adequate coverage at a fraction of the cost of premium plans. While saving money is always a plus, it's essential to understand what you're getting for your money.

What does cheap travel insurance typically cover?

Cheap travel insurance plans often offer basic coverage, which may include:

• Trip cancellation or interruption
• Baggage loss or delay
• Emergency medical expenses
• Emergency evacuation

While these coverages are essential, they may have limitations in terms of coverage amounts, exclusions, and deductibles. For instance, a cheap plan may have a low coverage limit for emergency medical expenses or exclude coverage for adventure sports or pre-existing medical conditions.

When is it worth investing in a more expensive plan?

Extended coverage and higher limits

If you're embarking on a high-value trip or travelling to a destination with high medical costs, investing in a more expensive travel insurance plan with higher coverage limits can literally be lifesaving if emergencies arise. Premium plans may provide:

• Higher coverage limits for emergency medical expenses including evacuation
• Coverage for adventure sports and activities
• Additional benefits such as trip delay, missed connections, and rental car damage

Pre-existing medical conditions

If you have pre-existing medical conditions, opting for a cheap travel insurance plan may not provide sufficient coverage.

Many budget-friendly plans exclude coverage for pre-existing conditions or offer limited coverage, which can leave you vulnerable to significant out-of-pocket expenses in case of a medical emergency abroad.

Comprehensive coverage

For travellers seeking comprehensive coverage, including cancel for any reason (CFAR) or upgrade options for lost or stolen items, a more expensive travel insurance plan may be worth the investment. Premium plans often offer:

• Cancel for any reason coverage
• Upgrade options for lost or stolen items
• Enhanced 24/7 travel assistance services

Risks of insufficient travel insurance coverage

Opting for the cheapest travel insurance plan without carefully reviewing the coverage details can expose you to potential risks such as:

Financial risks

Inadequate coverage for emergency medical expenses, trip cancellation, or lost baggage can result in significant financial impact on you.

Medical emergencies abroad can lead to exorbitant medical bills, and without sufficient coverage, imagine the horror of you paying out-of-pocket!

Limited protection

Cheap travel insurance plans often come with limitations and exclusions that may not provide adequate protection for your specific travel needs.

For instance, exclusions for adventure sports or pre-existing medical conditions can leave you unprotected in case of an accident or illness related to these activities.

Additional stress

Dealing with unexpected situations such as lost baggage, flight cancellations, or medical emergencies without adequate travel insurance coverage can be stressful and ruin your travel experience.

How to make an informed decision

Assess your travel needs

Before purchasing travel insurance, assess your travel needs and the potential risks associated with your trip based on the following factors:

• Destination and travel activities
• Value of your trip and prepaid expenses
• Health condition and medical history

Compare plans

Shop around and compare different travel insurance plans to find one that offers the best value for your money.

Pay attention to the coverage limits, exclusions, deductibles, and additional benefits offered by each plan.

Read the fine print

Carefully read the policy terms and conditions, including the coverage exclusions and limitations.

Make sure you understand what is covered and what is not to avoid any surprises in case of a claim.

Consult an insurance expert

If you're unsure about which travel insurance plan to choose, call and ask an insurance expert or travel advisor who can help you find a plan that meets your specific needs and provides adequate coverage for your trip.

It's always better to get the conversation on record, preferably on email so you can clarify any questions before purchasing. 

Conclusion

While cheap travel insurance can save you money upfront, it may not always provide sufficient coverage for your travel needs. 

Investing in a more expensive travel insurance plan with comprehensive coverage can offer better protection and peace of mind, especially for high-value trips or travellers with pre-existing medical conditions.

By assessing your travel needs, comparing different plans, and reading the fine print, you can make an informed decision and choose a travel insurance plan that offers the best value for your money. 

Ultimately, we travel to relax and create happy memories for ourselves and our loved ones, so all you need is that one purchase to ensure a safe and worry-free experience.

ALSO READ: 6 best travel insurance with Covid-19 coverage in Singapore (2024)

This article was first published in ValueChampion.