Navigating Travel Insurance Options for Pakistan: Tips and Recommendations

With more people looking for travel options, the rampant inflation and our currency woes can change travel plans unexpectedly. We may not be financially ready to book the next vacation, but it is now smart to consider investing in a comprehensive travel insurance policy when making travel plans. Doing this will protect you from financial losses due to unexpected issues before and during the trip.

Travel insurance is usually a disregarded investment until we suffer from plans being cancelled or changed. It is meant to offer travellers peace of mind and financial protection against most of the travel risks. The best way to decide about the usefulness of travel insurance is to ask yourself what you will lose if you cancel your travel plans at the eleventh hour.

Many travellers skip purchasing travel insurance because they think it is unnecessary. However, it offers additional protection from unforeseen events and expenses. Following are some tips and tricks to find the most effective travel insurance options.

Finding an Insurance Company

Getting travel insurance is pretty easy, and many different options are available. If you have never bought a travel insurance plan, an excellent place to start is insurance company sites that let you compare options based on price and coverage.

The benefit of using sites is that shoppers can view the entire travel insurance marketplace and compare different policies. You can always request a quote or call the firm’s toll-free customer service number for more information.

You usually have the option to buy travel insurance through a third-party provider. You need to carefully review the full details of the policy because the plans are based around the trip, hotel, and flights and can differ every time you book. You have to make sure you comprehend what you are paying for.

What does a standard travel insurance policy cover?

Travel insurance coverages can differ, but policies typically offer coverage for three things: safeguard against financial loss, protection for your health and safety for your belongings.

When buying a policy, look for the following:

1. Trip Cancellation Coverage

Travel insurance policy can compensate you for prepaid, non-refundable trip advance payments if a trip is cancelled for a reason covered by the policy. These expenses include airline tickets, hotel rooms, rental cars, tours and cruises.

Examples of accepted reasons to cancel a trip include illness, injury or death of the traveller, a close family member or a travelling companion; military deployment or civil unrest; a serious family emergency.

Other reasons include your travel supplier stopping its services for 24 hours due to a natural disaster, weather warnings or a strike, your home or destination becoming uninhabitable, or you or a travelling companion losing your job after you purchase your policy.

2. Trip delay coverage

if you experience a delay in your travel itinerary, your travel insurance policy can offer some financial relief.

Travel delay coverage compensates if a traveller is behind travel schedule for one of the policy’s covered reasons. This benefit will usually pay for expenses like food, lodging and local transportation that are acquired due to the delay.

• Covered reasons generally include severe weather, airline maintenance or civil unrest.
• There’s often a waiting period before your benefits kick in.
• A traveller must be delayed for the period listed on their policy to be eligible for this benefit. Some policies are very lenient and provide benefits available for any length delay, while other policies will specifically list a duration requirement. This usually ranges from three to 12 hours.

3. Trip interruption coverage

In cases where you need to cut your trip short due to illness or injury that occurs during your trip, or if there’s a family emergency back home, your policy may compensate non-refundable expenses you sacrifice if you return home early.

Your policy can also cover the price of a one-way economy airline ticket home. Not all reasons are covered by travel insurance, however. For example, if your beach vacation is a washout or you miss your new puppy, your trip interruption benefits won’t apply.

4. Baggage loss

Your travel insurance policy can compensate you if your checked baggage is lost and does not arrive at your destination.

If your travel insurance covers baggage benefits, your insurer can repay you, up to the maximum shown on the Confirmation of Coverage, for the covered loss, theft or harm to your baggage and personal items.

Insurance plans have specific coverage limits for each benefit, outlined in the plan documents.

Personal possessions are also covered by the travel plan if lost or stolen while you are travelling. Travel insurance can repay you for the actual cash value, repair or replacement cost— whichever is less, based on the restrictions in your insurance policy’s confirmation letter.

You have to report losses to your airline, airport, police or other authority like a tour operator or hotel manager. You will need to keep this documentation to give as proof when you file a claim.

Not all losses are covered by your travel insurance policy. For example, cash is not reimbursable, and many policies won’t cover costly jewellery, art, antiques or heirloom items. Don’t bring such items on vacation to reduce the risk of losing irreplaceable items. And make sure to read your policy in detail to see what is covered.

How much does travel insurance cost?

Travel insurance costs can fluctuate depending on how much coverage you’re getting and how expensive your trip is. Most travel advisory sites advise customers that travel insurance plans should cost between 4 to 10% of the total trip cost. So if you’re spending PKR500,000 on a tour, your insurance should be anywhere from PKR 10,000 to PKR50,000.

Budget plans are always available that will cost less but offer much less coverage. And you could also pay a lot for excellent coverage, so you can benefit from a cancel for any reason policy. Whatever you decide, read the fine print to know what you’re paying for.