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Travel insurance mart booming

Jai Arjun Singh | February 21, 2004

It was a precaution which turned out to be a blessing for Delhi businessman Sunil Goswami. On a trip to Bangkok, in January, Goswami was left high and dry after losing his passport.

Luckily, he had taken out insurance with Tata AIG for just such a contingency. A quick call to a toll-free number and he was quickly given $200 to take care of all extra expenditure that he might incur.

"The response was very prompt," says Goswami. "Their local agent got in touch with me and I was reimbursed almost immediately."

Goswami is one of millions of Indians who have been, or will be travelling abroad this year. Some have discovered that travel insurance is mandatory if you want to visit certain countries.

Others have discovered the travellers' variant of the Peter Principle -- when on the road, anything that can go wrong, will go wrong.

Luckily for Indian globetrotters, there are now more travel insurance options than ever before. Some are vanilla policies that cover illnesses and hospitalisation. Others also cover contingencies like lost passports or reimbursements for baggage loss or delay.

The Royal Cover with ICICI Globetrotter Overseas Travel Insurance, for instance, even covers the danger of being a hijack victim -- if you've been through that harrowing experience, you can expect a payment of $125 a day.

Most people will, hopefully, get through their journeys without being hijacked. Nevertheless, travel insurance is more essential than ever before.

At one level, countries demand it. Also, most companies don't allow their employees to travel without a valid travel insurance policy.

Tata AIG has recently signed up with Access Worldwide to offer overseas travel insurance policies. Says Anand S Gupta, chief executive officer, Access Worldwide: "However much you may need medical treatment while overseas, no one will touch you if you don't have insurance."

In the policy options offered by Tata AIG, the premium is based on the countries that you visit, the duration of your stay and the type of coverage you want.

How does this work? If, for instance, you're travelling to the Far East or any other Asian country for between one and seven days, the basic premium under Tata AIG's Silver Plan will be Rs 389 if you're up to 40 years old, Rs 454 for 41 to 60 years and Rs 734 for 61 to 70 years.

If your trip spans eight to 14 days, the corresponding amounts are Rs 670, Rs 734 and Rs 1,102 respectively, for the aforementioned age groups.

The cost is marginally higher for a trip to the Americas; the premiums for an eight to 14 day trip will be Rs 1,037, Rs 1,123 and Rs 1,663 respectively.

The premiums payable under the Gold and Platinum plans are higher; but naturally so are the benefits. Under the Silver Plan, you can get reimbursement for accident and sickness expenses up to $50,000 but this goes up to $200,000 under the Gold Plan and $500,000 under the Platinum Plan.

Also, reimbursement for baggage loss (up to $1,000) is provided under the Gold and Platinum schemes but not under the Silver one.

For frequent travellers, there are annual multi-trip policies, which cover any number of trips made during the year (as long as no single trip exceeds 30 days).

The Platinum Policy provides accident and sickness expense reimbursement of up to $500,000. The premium is Rs 5,033 for 18 to 60 years and Rs 9,720 for 61 to 70 years.

Be warned, though, that you will not be eligible for coverage if you are travelling against a physician's advice, or for treatment. Also, expenses incurred due to terrorism, illegal acts or participation in dangerous sports aren't covered.

Another alternative is ICICI Lombard's Globetrotter Overseas Travel Insurance, which provides two broad covers -- Royal and Raffles. The Raffles Cover is a purely health-related one.

If you're aged 40 years or less, the premium payable for a trip of up to seven days is Rs 489; this will entitle you to medical expense reimbursement of up to $50,000. Other factors being constant, pay Rs 621 and the reimbursement amount goes up to $250,000.

The Royal Cover is a more comprehensive option, providing cover for not just medical expenses but other contingencies as well.

For a premium of Rs 954 (for age up to 40 years and trip duration up to seven days), you get medical insurance up to $250,000.

But you also get reimbursement for personal accident (death or permanent disability caused by an accident) up to $25,000; repatriation of remains (in case of death overseas) up to $7,000; hijack distress allowance up to $125 per day; and reimbursement for baggage loss or delay.

Naturally, for other age groups and for trips of different durations, you can make the relevant calculations as per the plan table. One of the advantages of the ICICI offer is that the premium is calculated on a per-day basis.

This means the method of computing the amount payable is slightly more complicated -- keep your calculators handy -- but the upside is that a 22-day trip, for instance, won't be considered part of a fixed 21-30 day slab.

What about students heading to foreign shores? Bajaj Allianz's Travel Companion offer provides reimbursement of tuition fees up to $10,000 if the insured is unable to continue his studies because of: hospitalisation caused by a serious medical condition covered under the policy; or death or injury requiring hospitalisation of either of his parents.

This scheme, available to those aged between 16 and 35, also provides medical expense reimbursement of up to $50,000 (Standard Cover), $100,000 (Silver Cover) or $200,000 (Gold Cover).

The premium for a trip of up to 30 days is Rs 1,120 under Standard Cover, Rs 1,410 under Silver Cover and Rs 1,825 under Gold Cover. The amounts for a 365-day trip are Rs 8,960, Rs 10,200 and Rs 14,600.

Other plans that enable you to customise your scheme to suit specific needs include ICICI's Royal Family plan, applicable to a minimum family composition of self, spouse and one child. (The maximum limit is four children) For a trip of up to seven days, a premium of Rs 1,389 (for the parents) and Rs 320 per child will get you a policy with reimbursement up to $50,000.

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