Should you buy insurance for travel within India?

While travelling internationally, most people ensure that they buy travel insurance policies, and many countries have this as a pre-condition for issuance of visas, not too many people opt for domestic travel insurance.

Let us take a look at why it is important to opt for travel insurance even for travel within the country.

What do most domestic travel insurances cover?

Medical/accident cover, cancellation/delay cover, and lost baggage cover. These are useful especially when travelling to places like north India in the winter, when there is a chance that flights are unduly delayed due to heavy fog or when travelling with valuable items in your baggage, which if damaged or lost can be expensive to replace.

There are also various covers, ranging from covers for that particular trip, to family covers, to frequent business covers.

Let us look at some of these covers a little more in detail:

• Medical/Accident cover: This takes care of any medical emergencies during the trip, or if there is any accident. It is especially useful for those who have no or limited medical cover otherwise.
• Flight cancellation/Delay: Airlines are notorious for delaying flights and sometimes even cancelling the flights. This can not only cause inconvenience but can also be costly as one can miss connecting flights or hotel accommodations. The insurance cover compensates you for the delays or cancellations -- but ensure that you get it in writing from the airline that the event occurred; else the claim might be rejected.
• Lost baggage: Every traveller fear loss of baggage in transit, and sometimes this actually comes true. Although most airlines have compensation policies for lost baggage, it may not be sufficient to cover the cost of the lost bag. Travel insurance goes some way in ensuring that the cost of your belongings is at least recovered.
• Personal liability: This is a new cover that some insurers offer and it covers against accidental damage to other people’s property. It is ideal for people travelling with children.

The various options in the policies such as one time travel, frequent travel, etc. pertain to one’s requirement. For example, if you are going on a holiday to Delhi, then it is unlikely that you need long-term travel insurance, but on the other hand if you travel often on work, then a long term plan gets handy.

For most people on domestic trips the last two covers will be worthwhile, while the first (medical) cover will be redundant since they may already have a health policy.

Also, the medical cover will typically not cover a variety of illnesses such as maternity, pre-existing conditions, etc. It will also not cover acts of terrorism or other acts of violence.

Since one’s existing health policy might cover more illnesses, this travel plan is not ideal for people with a good health insurance. However, the flight delay/cancellation, lost baggage, and personal liability covers are worth having.

Keep in mind that selecting the right insurance policy has to be done carefully, since just like regular insurance, travel insurance comes in many options, and there is no one right plan.

Also, read the fine print and ensure that you have all the documentation required for successfully submitting a claim.

Summary:

• Domestic travel insurance is cheap and useful for the various covers it offers
• Read the fine print carefully and select the right insurer
• Select the right insurance for you

Illustration: Dominic Xavier/Rediff.com

Anil Rego is the founder and CEO of Right Horizons, an investment advisory and wealth management firm that focuses on providing financial solutions that are specific to customer needs.