How to Buy Travel Insurance: 7 Common Mistakes

Everyone knows that travel insurance is a must-have, but are you making any of these mistakes that are costing you more money?

Travel insurance plans are relatively affordable, and it gives you the peace of mind knowing that you are sufficiently insured. Be it medical expenses, trip cancellations and flight delays, travel insurance helps to cushion the costs when you’re abroad.

Though they are not that expensive, there are still some things that could make you pay even more than you have to, when it comes to expenses you thought you were covered for but are not.

Are you guilty of any of these points? Read on to find out what they are.

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Why travel insurance may be costing you more money

Travel insurance can potentially save you money – if it’s used right. 

Essentially, this boils down to understanding what risks you want to protect against, and finding the right travel plan that covers said risks. 

A mismatch between your needs and your benefits will cause gaps in your coverage. This translates to not having adequate compensation should you encounter mishaps on your trip. 

Thus, despite buying travel insurance cover, you may find yourself still having to pay out of your own pocket – in effect, costing you more money.

To avoid this unfortunate scenario, watch out for these seven following mistakes. 

Top 7 common mistakes

#1 Getting travel insurance as a top-up on your air ticket

More often than not, you might be tempted to top up a travel insurance policy when you purchase your air ticket because of its very low price. However, these policies usually have very minimal coverage with low claim limits and may even exclude certain coverages from the plan.

Though the low premium you might make you think you have copped a good deal, you’ve actually just paid for bare-bones travel insurance cover.

Though you might think you have copped a good deal by paying a low premium for your travel insurance and skipping the hassle of finding one for yourself separately, you might not be getting sufficient coverage that you need.

When the unexpected happens, you may realise that the travel insurance you bought doesn’t cover for it, and end up having to bear the cost of it yourself. So before you commit to the policy, make sure you read through the coverage and policy documents.

#2 Buying travel insurance last minute

Though the saying “better late than never” also applies to buying travel insurance, getting a plan while you’re heading to the airport or once you land might actually be too late.

Travel insurance cover such as travel delay cannot apply retroactively, so you cannot purchase a travel policy after your flight has been cancelled, and expect to be compensated. This also applies to coverage for trip cancellation, baggage delay, natural disasters and agent insolvency.

Hence, be sure to purchase your travel insurance policy once you’ve confirmed your travel plans, just in case you have to cancel or alter them at the last moment.  

#3 Not reading through the travel insurance policy documents

However tedious, there’s an important step you need to take before you purchase the travel insurance plan you selected — and that is reading through the policy document.

This is because not all travel insurance plans offer equal coverage, and there are exclusions and sub-limits you may not be aware of. For example, a policy may have up to S$5,000 coverage for personal luggage, but only a fraction for credit cards or laptops. Also, some travel insurance plans exclude mobile phones altogether. 

COVID-19 cover is another example – some plans (like FWD’s travel insurance) require you to opt-in for an extra fee, otherwise your benefits won’t apply should you catch the disease and have to cut your trip short. 

See also: FWD Travel Insurance Review 

#4 Buying the cheapest travel insurance

You might think getting the cheapest travel insurance policy out there would be sufficient because at least you’re covered right? 

But it might be cheap for a reason. Perhaps the baggage loss coverage isn’t enough for the latest Macbook Pro. Or maybe the plan itself doesn’t come with any COVID-19 coverage to cover you for any trip cancellations or COVID-19 medical expenses incurred.

Even more serious, a basic travel insurance policy may not come with emergency medical evacuation, repatriation or even travel delay coverage – which are all critical to any traveller. 

#5 Always getting the most basic plan

I bet many of you are guilty of this because I used to do this too — always gravitating towards using our credit card, buying the most basic plan, and calling it a day.

Have you read through the coverages and exclusions? Have you compared it to the next plan tier? Maybe that extra top-up is worth it because it offers much higher coverage. And there are some things that the most basic tier plan doesn’t cover that you might overlook.

For example, Singlife has this unique clause whereby you can cancel your trip for any reason and they’ll let you make a claim. However, this coverage only applies to the Travel Plus and Travel Prestige plans, not the basic Travel Lite plan.

If you perhaps are going for a longer trip or are participating in adventurous sports overseas, you might want to consider a better plan with more coverage. But do look out for the fine print and make sure what you want to be covered for is being covered.

See also: Singlife Travel Insurance Review: Well-Rounded Coverage

#6 Buying multiple single plan policies

Single travel insurance plans are relatively affordable, especially for shorter trips to countries near Singapore, which only cost about S$20+ for each plan. However, these plans add up, and beyond a certain point, cost more than an annual plan.

Generally, if you’re planning three or more trips per year, you should look into annual travel insurance policies for potential cost savings. Also, you need only purchase travel insurance once to be covered for the next 12 months – provided you observe the restrictions that come with such plans.

#7 Not purchasing travel insurance for short trips

A 3D2N trip to Genting Highlands. Or a 2D1N trip to Batam. Do you need travel insurance for this? Absolutely yes! There’s no way you can be certain that you won’t meet with any travel inconveniences when you’re abroad, no matter how short your trip is. 

What if you want to cancel your trip because of COVID-19? Or fall sick during the trip and require medical assistance? You won’t be able to claim anything if you don’t have any travel insurance. And if for any reason you’re really ill and require hospitalisation,  the medical bills can be really hefty and cost you way more than if you decided to purchase a travel insurance plan.

Though the chances of it happening are pretty low, it’s always better to be safe than sorry.

FAQs when buying travel insurance plans

1. What should I do if I have a medical emergency overseas?

You should seek help from the nearest clinic or hospital. After treatment, be sure to obtain an official receipt for all costs and expenses involved – hospital bills, taxi fares, extra accommodation, etc. 

Once you return home, you can submit a claim to your insurer along with your receipts for compensation. 

2. Will my travel insurance cover me if I travel overseas for medical treatment?

Most likely not. Travel insurance is meant to offer a safety net should you require medical care while travelling, due to illness, accidental injury or other unexpected scenarios. Travelling overseas expressly for medical treatment is considered a planned event, one most travel policies are not priced to cover. Instead, you will require a global healthcare plan or one that has overseas treatment benefits to be covered in this situation. 

3. How much travel cover should I get?

This will depend on personal circumstances and preferences. In general, you should prioritise medical expenses, emergency evacuation and repatriation and personal accident coverage, as these are likely to have the largest financial impact. Travel delay, trip curtailment and trip cancellation benefits should be high enough to cover the costs of non-refundable items such as tickets and accommodations, while personal luggage and belongings cover is likely to be appropriate only for mid-range or mass-market consumer items. 

4. If I need to go to the hospital when overseas, will my travel insurance policy cover everything?

Most travel insurance policies will cover the majority of your hospital bill, but some items may be excluded. Some examples are ambulance fees, certain drugs or treatments, and hospital admin fees. You may also face deductibles, co-pays or excess, depending on the insurer. 

5. Does my travel insurance plan cover the costs of dental treatment while overseas?

Travel cover for dental treatment largely only applies during an emergency, such as a serious traffic accident which requires emergency dental repair. There is usually a separate claims limit for emergency dental coverage. Simple events such as toothache or tooth extraction are unlikely to be covered by travel insurance policies.

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