Travel insurance: Do you still need COVID-19 coverage?

SINGAPORE: The year-end holidays are just around the corner. Many of us are planning to travel overseas again after more than two years of the COVID-19 pandemic.

Many countries are welcoming back visitors after easing or lifting their COVID-19 entry restrictions.

But at the same time, new COVID-19 variants have been popping up across the globe. And this is why insurers are advising holiday makers to make sure they get the right coverage when choosing a travel insurance plan. 

IS COVID-19 COVERAGE IMPORTANT? 

A travel insurance plan with COVID-19 coverage is necessary, said Mr Alan Wong, a financial service director at Prudential and an authorised agent of AIG Singapore

He added that the possibility of contracting COVID-19 before and during one’s travel is still high and such coverage will take care of most of the costs related to medical expenses, travel cancellation, travel postponement, travel curtailment and overseas COVID-19 diagnosis quarantine allowance.

Ms Winnie Loh, founder and director of Ad Maiora, an insurance agency, agreed that COVID-19 coverage is important. She also noted that the number of COVID-19 cases is increasing in many countries.

WHAT TO LOOK OUT FOR IN TERMS OF COVID-19 COVERAGE? 

Mr Wong recommended that travellers look out for the limit of COVID-19 coverage in their travel insurance policies to check to see if it's sufficient to cover the cancellation cost of one’s air tickets, accommodation and itinerary.

"For example, airfare costs S$3,000 and accommodation costs S$2,000 but the trip cancellation limit is only S$2,500. Thus only part of the cost is covered," he explained.

Mr Chandramogan, an executive senior financial planner with Great Eastern Singapore, also said it is important to find out the sub-limits of the benefits included in the travel insurance plan.

“There could be a case where a person could be down due to COVID-19 and might need to cancel, postpone the trip or suffer some travel disruption either before, during or after the trip,” he said.

"For such situations, insurance companies will reimburse based on the sub-limit of (the) plan for expenses incurred during these situations."

The destination should also play a part when deciding on a plan, he added.

He said: "For example, in the US, medical costs can be crazy and depending on the type of hospital and number of days, you might incur quite a hefty amount."

HOW EARLY SHOULD YOU BUY TRAVEL INSURANCE?

Buy early and think of it as a way to “maximise your coverage” in case you need to cancel your flight, said Ms Loh.

Others insurers also recommended that travellers buy their travel insurance plan as soon as they book their plane tickets and accommodation.

This is because some people may have to cancel or postpone their trips due to a variety of reasons, including injury or death.

With COVID-19 coverage, those diagnosed with the coronavirus will be covered if they cancel or postpone their trips, said Mr Wong. 

WHAT ARE COMMON MISTAKES TO AVOID? 

Some common mistakes travellers make would be choosing the cheapest travel insurance policy available without ensuring that the coverage is sufficient.

Mr Chandramogan said that one might be infected with COVID-19 while overseas and depending on the COVID-19 measures and protocol in that country, you might find yourself incurring a huge bill.

Some people also prefer to purchase travel insurance online instead of through an agent, said Mr Wong.

He said: "The claims process might not be straightforward in some cases and it might result in some claims being rejected."

Mr Chandramogan echoed his view, saying that there are many scenarios that can happen while overseas and it may be hard for an individual to self-manage the claim.

"Imagine you are overseas and you are in an accident, I doubt you will be in the right frame of mind to know how to do your own claim," he said, noting that buying travel insurance policies online can be "slightly cheaper".

He added that the claim requirements and documents needed vary according to the type of claims made, so it saves the claimant "a lot of hassle" if there is someone telling him or her what to do.

He said: "You do not want to come back thinking you can claim, (only) to realise that you are unable to because you did not get the right documents."

Another piece of advice: Don't save on travel insurance even for a short trip to a neighbouring country. 

"There are many cases of items being stolen, (travellers being) met with road accidents and incidents of food poisoning occurring during short trips and consumers did not purchase any travel insurance to cover these," said Mr Wong.