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Understanding travel insurance

TRAVELLERS-FRANKFURTTravel insurance is the one thing that most travelers complain of being ‘robbed’ by their agents citing that it is not necessary. Many have complained that it should be left to those that feel they absolutely need it.

I have been asked by many clients especially those travelling on private businesses why it is important to buy a travel policy every time you travel. Many have argued that they have been flying for ages and never experienced anything that compelled them to be insured.

It is true that air travel is arguably the safest mode of travelling with slightly above zero percentage of all flights recorded in a year getting into accidents. One is almost certain that the flight he/she is taking will safely get to its destination unlike road travel where we have more than 3 percent of uncertainty, but we are not compelled to be insured when we use vehicles.

The reason for travel insurance, however, is not just against the risk that may come in case of an accident.  Most people who travel by air have health insurance in their own countries but it is important to note that when we travel out of our countries, our local health insurance doesn’t cover us. These policies only cover us within the boundaries of our home countries.

But the worst can happen and you fall sick while away from your country. It happened to one of my clients whom I had traveled with last year. We had to call an ambulance. Despite the short distance to hospital, the cost of the ambulance was 250 USD. The doctor’s consultation fee was 235 USD and after it was decided that he had to be admitted, we were asked to pay a hospital deposit of 3000 USD. Luckily we had been insured for the trip. The cost of the travel policy had been about 50 USD.

Now imagine the friend had travelled without insurance. The loss would have been immense but just for 50 dollars, he was saved from incurring a medical cost of more than 6000 dollars.

What is important is that travellers need to buy their travel insurance from reputable companies that will act promptly in case a need arises. Not every company or broker who comes marketing their policies to you is necessarily useful to you when you are in need.

By Bernard Gitonga

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