Travel insurance explained
Wondering if you should opt for travel insurance on your next trip? We’ve come up with a quick guide to help you decide!
KUALA LUMPUR, Dec 10 — Traveling to a foreign country for the very first time can be an exhilarating yet dangerous experience.
Accidents can happen at any time and while the fault may not always lie with you, the consequences and subsequent expenses will be yours to bear.
Travel insurance however, can provide you with a sort of cushion against the costs associated with travel related mishaps.
So take a break from packing your underwear and read on for our ultimate, all inclusive, first class guide on travel insurance.
How much does travel insurance cost?
Travel insurance isn’t as expensive as many people think. Considering the amount of coverage and payouts, it is almost a no-brainer to spend a little more into travel insurance.
Today, there are dozens of travel insurance policies available, with varying levels of coverage and corresponding premiums.
Travel insurance premiums are calculated based on several factors: duration, destination, and individual/family travel insurance.
If you are a serial traveller or have a job that requires you to travel constantly, it may be better to opt for an annual travel insurance policy.
Duration of travel
Travel insurance policies are charged based on the duration of the trip.
But instead of charging by the total number of days, insurance companies makes it easier for customers by charging policies based on duration blocks, such as 1-5 days, 6-10 days, and so forth up to a full 30 days; some policies only last for 30 days at a time, while others can be extended with subsequent one-week blocks.
But, if you are a serial traveller or have a job that requires you to travel constantly, it may be better to opt for an annual travel insurance policy.
In the long run, this adds up to better savings compared to ad-hoc policies purchased ahead of each trip.
Domestic vs international travel insurance
Bangkok? New York? Paris? Penang!?
This probably shouldn’t shock you but your travel insurance premium depends hugely on where you plan on traveling. But before we get into that, let’s define how travel insurance companies sort out their regions.
Domestic travel insurance covers all travel within Peninsular and East Malaysia. But before you get too excited, you should probably know that claims can only be made at least 50km away from the insured person’s place of residence.
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So if you live in Kuala Lumpur and plan on making a travel insurance claim for your “staycation” in Subang Jaya, the insurance company will not only flat out deny you, they’ll probably laugh at you as well.
Likewise, international travel insurance covers travel outside Peninsular and East Malaysia. Most travel companies usually split their international regions of coverage by geographic location.
For example, the company could consider all countries in South East Asia to be region A and all countries in Europe to be region B. Premiums for coverage in region A would be much different than coverage in region B, with B naturally being the more expensive of the two due to distance.
In addition, the travel insurance company might also offer world-wide travel insurance coverage packages. But does this mean every single country in the world is covered? No! To minimise risk, countries that are currently experiencing civil war or any other forms of social instability will not be covered by the insurance company.
Family vs individual travel insurance
Most travel insurance companies in Malaysia separate their packages into two distinct categories: family and individual.
The premiums of these two categories are priced differently with the family package usually being significantly more expensive than the individual one.
The individual package offers coverage for one person aged 18 and above. Family insurance, on the other hand, is designed to offer protection to the insured person, his/her spouse and/or all of their children.
There is generally no limit as to how many children the family insurance package can cover, so even if the insured couple has 20 children (gasp!), all of them will be entitled to some degree of coverage.
Wait! My wife and my children are covered, but will my parents be covered by family travel insurance? If you’re planning a big fat family reunion holiday trip then you would most likely have to buy either an additional family package or multiple individual packages to cover all your immediate family members.
Let’s face it, the risk exposure for a family travel insurance package that covered your entire bloodline would be simply too high to consider being introduced.
Travel insurance should be seen as a necessary expense — you can decide how much premium to pay thanks to the diverse range of policies available, and then select the one that has the best balance between coverage and premium cost.
Should i always buy travel insurance?
Buying travel insurance is like rolling a dice. If you buy insurance and nothing happens, then you just spent money — however little it may be — to pay for the premium for nought.
However, if you don’t buy insurance and a random act of God happens, then you’ll be stuck smacking your forehead with your palm in disbelief.
All things considered, travel insurance should be seen as a necessary expense — you can decide how much premium to pay thanks to the diverse range of policies available, and then select the one that has the best balance between coverage and premium cost.
That way, the cost to insure your trip is entirely in your hands.
Our travel insurance page has an extensive list of travel insurance policies available in Malaysia, and it’s sorted by premium price, so that’s always a good place to start.