Most frequent travellers in the country opt for travel insurance in a bid to protect themselves from various eventualities. Travel insurance is typically provided by general insurers and standalone health insurers, and it focuses primarily on providing coverage against the health issues faced by policyholders abroad. However, travel insurance falls short when it comes to providing life coverage, funeral expenses, burial expenses, etc. If you wish to provide financial security for your dependents after your death, a life insurance policy is a must even when you are travelling abroad.
While signing up for a term insurance plan, an insurer may perform various checks to determine the eligibility of the applicant. The paperwork required for a term insurance plan typically requires income proof to assess the earnings of an individual. The insurer may also check for other things like smoking habits, pre-existing diseases, etc. One of the checks usually performed before issuing a policy is the number of foreign trips taken by the applicant. If the applicant is a frequent traveller, the company will assess whether he/she has travelled to any high-risk zones in the world.
If the applicant has travelled to high-risk zones frequently, the insurer may reject the application even without asking about future travel plans. In certain cases, the company may ask for additional information about one’s job and future travel patterns. All these factors will be considered while calculating the premium amount for a specific plan. If you have not travelled to any foreign country before, most companies do not ask for future travel plans. Once a term insurance policy is issued, it provides worldwide coverage for all policyholders. In other words, all term plans provide compensation even if a policyholder dies in a foreign country during the policy term.
It is worth noting that life insurance and travel insurance differ a lot from each other in terms of coverage provided. One cannot be used as an alternative to the other. Here is a quick look at the difference between these two plans and how they can benefit frequent travellers.
|Travel insurance||Life insurance|
|It provides coverage for medical expenses during the time of an unexpected emergency in a foreign country.||It provides compensation to the family of the insured person against his/her unexpected death in a foreign country.|
|The benefit is usually provided in US dollars in order to manage the expenses in a foreign country.||The sum insured amount is paid to the dependents only in Indian rupees.|
|Most policies provide built-in coverage for other expenses such as loss of baggage, loss of passport, personal liabilities, trip delays, etc.||Additional compensation is provided only if relevant rider covers are bought alongside a life insurance cover.|
|Most of the travel insurance covers include a build-in personal accident cover to provide compensation against the death or disability of the insured person.||Life insurance plans do not provide any compensation against the disability of the insured. However, rider covers can be bought to enhance the level of protection received.|
|Travel insurance covers can be purchased on an individual basis as well as for the entire family.||Life insurance covers are typically available on an individual basis with very few companies in the market selling dual plans for self and spouse.|
|For medical treatments, the claim amount is typically paid to the hospital in which the treatment is undertaken.||Life insurance covers do not provide any medical benefits.|
|In case of death of the insured, the claim amount is paid to the nominee or legal heir.||In life covers, the death benefit is paid to the nominee or legal heir of the insured person.|
In case of the death of the insured person in a foreign country, the dependents can file a claim request to the company with all the necessary documents. Life covers, including term plans, do not have any provisions for the transport of mortal remains from a foreign country. In this situation, the family must bear this cost. The sum insured amount is payable in India and only in Indian rupees. Various documents such as claim form, death certificate, medical certificate (if necessary), certificate from authorities, etc., must be filed while making a claim request. The insurer will verify the documents and provide the settlement amount to the nominee.
Life insurance coverage provided for travellers is not very different from the regular coverage offered by insurers. However, frequent travellers must provide the necessary details while applying for a life insurance cover. Most companies in the market provide a travel questionnaire during the application process. A life insurance company may provide coverage or determine the premium amount based on the risk factors associated with the travel plans of an applicant. Once insured, the same benefits are available even for frequent travellers.