In July 2004, Sheila Chaman was paralysed after she slipped an hour before catching a flight back to India from the US, where she had gone to visit her son. Chaman required three months of physiotherapy before she could walk again.

That's when the 21-day Travel Insurance Policy she had taken from Bajaj Allianz General Insurance before her overseas trip helped her. Says Chaman, "A visit to a doctor, even for a small problem, can burn a hole in your pocket. Hospitalisation is a step further - it makes you bankrupt. That's why a cover is needed even while travelling."

Nearly 4.9 million Indians travel abroad every year. A safe way to travel is to buy travel insurance to cover many risks door-to-door (see Travel: Risks Covered). A good travel cover reimburses all your medical expenses, even if you fall sick while in transit. Some policies also provide financial liability cover where a fixed amount is paid as emergency assistance if the policyholder loses travel funds.

If you damage any property unintentionally during a trip abroad and are liable to pay the damages, all the personal liability will be paid by the insurance company. Apart from these covers, you will get personal accident cover, which insures you against both permanent and partial disability.

The products. Travel insurance is provided for slabs of five to 30 days. You can renew the policy if you extend your travel beyond the number of days for which you had taken cover. Public sector insurance companies provide overseas mediclaim policies and cover other risks like loss of baggage and passport as top-ups.

Private insurers, however, provide all these covers under one policy. Most insurers segregate policies according to age brackets such as one-40, 40-60 and 60-70 years. Premiums are higher for higher age brackets. They also vary according to the country you are travelling to. For example, the premium for the US is higher than for Europe.

Travel: Risks Covered

• Health
• Loss and delay of checked baggage
• Loss of passport
• Theft, robbery of travel funds
• Personal liability
• Personal accident

Exclusions. Travel policies don't cover any treatment which can be postponed until you return to India. Only serious illnesses that need immediate medication or hospitalisation are covered. Illnesses that existed before you started travelling as well as cosmetic treatments are also not covered. Insurance is not provided against accidents caused by a war, suicide attempt, self-injury, and illness resulting from alcoholism or drug addiction. Finally, damage done intentionally by the insured to himself is not covered.

How to lodge a claim. You have to inform the insurance company within 24 hours of the occurrence of anything for which you are covered. The policy document mentions the helpline number for this purpose. Some of the western countries have made travel insurance policy a prerequisite for granting visas. Most hospitals settle bills directly with insurance companies. Recounts Chaman: "My son called up the Bajaj Allianz helpline number and they assured us that it would all be taken care of. That was a huge relief for us."