With the advent of COVID-19, one thing has become abundantly clear, that insurance is no longer optional but a strategic necessity, particularly when travelling. It follows that the demand for travel insurance in South Africa is skyrocketing. We have received a number of questions around travel insurance, people have been asking us, “Rateweb, should I buy travel insurance? Should I insure my next trip? Is it right for me? Do you guys buy travel insurance? Who sells the best travel insurance?”
Those are some of the questions we will address in this article
Travel Insurance is a range of insurance offerings covering unforeseen losses while travelling, either international or domestic. Travel insurance generally covers including but not limited to medical emergencies, trip cancellation, trip interruption, delays, medical evacuation, and lost, damaged, or stolen luggage.
The first thing you need to know is that travel insurance doesn’t make sense for everyone. To determine whether it makes sense for you, you have to decide how willing you are to take financial risks related to travel.
Travel insurance exists to minimize financial risk when travelling. So you have to look at the trip you are taking, how much money did it cost? If for unforeseen reasons you can’t go or something happens, how much money will you lose? Do you lose a few hundred rands in airfare or is it an R150,000 once in a lifetime trip?
Those are things you have to look at to decide whether you want to buy travel insurance or not. You also have to ask yourself, how much is peace of mind worth to you? If you’re someone who worries a lot, peace of mind might actually be worth quite a bit.
Travel insurance is not a one-size-fits-all thing. And every travel insurance plan covers different areas and different conditions. These are the most common types you might be interested in and looking for in a travel insurance policy.
If you see a policy labelled as a comprehensive policy, that’s typically one that covers almost all of the things that we have talked about. If you are looking at a policy that says it’s reimbursement only, then the way that policy works is you pay first and then you get reimbursed.
Travel insurance generally costs 5% to 12% of the total costs of the trip. The biggest determining factor in the cost of insurance is the age of the people being insured. If you are above the age of 50 years, then the cost generally considerably goes up.
Children under the age of 17 might be covered for free or discounted provided that there are some adults on the policy already. The prices of travel insurance can range widely, so it is important to shop around policies.
You may be interested in checking our article on what you need to know before signing up for insurance in South Africa. Don’t just buy the travel insurance company that your airline or cruise company is pushing on you when you book directly with them, do your own research.
Many people think that you have to buy travel insurance at the same time that you book your tickets or flights or cruise, but that’s actually not the case. Typically, you don’t have to buy many types of travel insurance until just before you go. However, if you are buying something like trip cancellation coverage you are better off buying early, it tends to be cheaper that way and gives you more value.
If you buy it later on, well, you might not be reaping the benefits, cause something might already have happened, and you had to cancel the trip. There are some policies that do require you to purchase within 7, 14, 21 days of booking your trip.
So you should research the policies and try to book it around the same time, but you don’t have to.
The fifth thing to know is a bit more detail about medical insurance coverage. This is one of the most important areas of travel insurance and so it is paramount that we dive into it a little deeper than we did earlier.
First of all, if you already have health insurance, your existing health insurance plan or policy might cover you when you go on travel. Read the details, call your insurance company, figure that out before you buy travel insurance so that you don’t spend money twice on something you’re already covered for.
You need to dive into the details a little bit because if your insurance company says they cover you, well, they might actually be billing those coverage things out of network rates, which could actually lead to some really expensive medical bills if something happens to you while you are on travel.
We mentioned earlier, but we will say it again, If you are going to someplace kind of sketchy, you might really want to look into a policy that gives you an emergency airlift service to take you to a civilized hospital.
This type of coverage becomes more important the more adventures and the more remote places you go. For example, if you are hiking Mount Kilimanjaro and something happens to you upon the mountain, well, you are first going to need a helicopter. And then after the helicopter, you will need an airplane to actually take you someplace civilized.
So that can get expensive really quick.
So a lot of people ask us, “Rateweb, do I need travel insurance if I already have a credit card that comes with some premium benefits?” Well, it depends on the card that you have. Our favourite card for travel is the Capitec Global One Card.
If you are below the age of 75 years and you buy your air tickets through the Capitec Global One Card you automatically qualify for basic travel insurance. You may also opt for the comprehensive travel insurance cover. The basic cover covers emergency medical and related expenses of up to R10 million.