Many Malaysians still see travel insurance as an unnecessary cost. Sunday Star takes a closer look at what it offers and the fine print policy holders should look out for.
WITH the new KLIA2 runway finally opened and AirAsia moving its operations here from LCCT on Friday, travellers are bracing themselves for the usual glitches that come with the opening of a new airport.
Legal officer Mandy Soo, 35, who is flying from Kuala Lumpur to Miri, Sarawak, in June, is considering getting travel insurance for her trip.
“It will be the first time I am flying out from KLIA2, so I’m hoping for the best but also preparing for the worst,” says the adventure buff who plans to hike up the Mulu Pinnacles.
“I’ve already paid for the guide, accommodation and transportation package, so I can’t afford to miss the flight. It will be my first time buying travel insurance.”
Copywriter Ding never buys travel insurance despite travelling at least five times a year.
“If I lose my luggage, there’s nothing much inside anyway,” says the 30-year-old globe-trotter who has travelled to about 40 countries.
Many Malaysians, according to a senior insurance agency manager, have the wrong perception that travel insurance is redundant. This probably explains why travel insurance is still unpopular here.
“Life and personal accident insurance cover death and accidents but what happens if your flight is delayed or cancelled, your luggage is lost or you fall sick away from home?
“Travel insurance is very cheap relative to what it covers,” the agency manager from Petaling Jaya points out.
WorldNomads.com offers good advice – always act as though you are uninsured! The popular online global travel insurance provider for independent and adventurous travellers covers residents in over 150 countries, including Malaysia.
It cautions prospective travellers that while “accidents happen, stupidity doesn’t”.
The latter and, of course, “extreme risks” such as trekking across the Arctic in a t-shirt, are obviously not covered.
Elaborating, WorldNomads head of content Phil Sylvester says travel insurance covers unforeseeable events but there are many activities where bad outcomes are predictable.
“You have to do everything in your power to limit any claim, which is to say, don’t do anything stupid.
“Something might be dangerous or exhilarating but if proper precautions have been taken to reduce the risk, it may be covered,” he adds, citing examples like wearing a helmet while skiing.
He, however, feels that there are things that no level risk mitigation could prevent from being defined as “stupid”.
Patting a lion cub, even if the safari park manager says is okay, would be silly because it is a wild animal with sharp teeth and claws!
There are times when bad things happen, but they are rare, he admits.
“From a dropped camera to an Australian who broke his back skiing in France, every claim we pay is a ‘thank God’ moment.
“He (the Australian) is now a paraplegic. The cost of his medical care in France and repatriation back to Sydney for rehabilitation would have meant his family selling their home and going bankrupt if they had to pay for everything themselves.”
Some attention-grabbing testimonies on the website were from a monkey-bitten traveller in Thailand and another who was “drugged, kidnapped and robbed” in Ecuador.
Ex-insurance agent A.L. Lee, 36, is a firm believer in preparing for the “what-ifs”.
“You hope you will never need it, but you still have to get it. But people tend to feel cheated when everything goes smoothly and they don’t need to make a claim.”
Having processed numerous claims, including one of a couple whose holiday got cancelled after the wife had dengue, she sees no point in being “penny wise but pound foolish” when it comes to getting travel insurance.
Like Lee, lawyer Ch’ng Sen Mei, 36, never travels without insurance and recommends getting a comprehensive package.
She recently went on a family trip to Hong Kong armed with a RM57 premium for six days of coverage – a purchase she was glad she made.
A paediatric consultation in Hong Kong cost her a whopping HK$1,000 (RM435), excluding medication.
A recent experience with her agent, however, left a sour taste.
“I asked my agent to get travel insurance for my mum from April 5 to July 3. Imagine my horror when she e-mailed the cover note for coverage from June to September. Now we have no remedy because the insurance company cannot issue a fresh policy once the plane has taken off,” she gripes.
She recommends buying travel insurance at least two weeks prior to departure or getting annual insurance if you are a frequent traveller because it is cheaper and more convenient than making “as and when purchases”.
Kendra Kong of Multi-Purpose Insurans Bhd (MPIB) says travel insurance provides coverage before and during travel but it is important to buy once you have booked your air tickets or package tour for the pre-departure benefit to kick in.
The local insurance provider, which offers travel protection plans from RM5 onwards, highlights emergency evacuation as the most important benefit travel insurance offers.
A bad fall while trekking through a remote mountain in China, Kong says, is just one of many possible situations where emergency evacuation becomes a necessity.
“The nearest village hospital won’t have the facilities to treat you. Emergency evacuation ensures that you are brought to a well-equipped hospital in the city even if it is miles away.”
She says even those with personal and employer-provided life and personal accident insurance coverage need travel insurance because it is doubtful that these will cover medical evacuation. And the sum awarded for mortal remains repatriation, if provided, is at best a few thousand ringgit.
“A travel insurance provider like us, for instance, allows a maximum claim of up to RM100,000,” she says.
She also reminds travellers to check if the medical benefit covers both sickness and accident expenses.
“A travel policy that covers sickness will reimburse you for treatment of diarrhoea or flu but not necessarily hospitalisation cost,” she says.
For Peter Daams of Travellerspoint, a global travel community portal, travel insurance is a must.
Small things like lost luggage are not the main concern for him. He is more worried about medical and hospitalisation costs.
“Unexpected medical bills can run into tens or even hundreds of thousands of dollars if you need medical help in somewhere like the US (United States).
“I know of travellers who have really been hurt by overseas medical expenses.”
A little-known fact is that travel insurance covers car rental excess fees and is usually far cheaper than buying insurance from the car rental company, he adds.
Executive E. Bernice, 36, still buys travel insurance although her bank provides coverage when she charges her flight ticket to her credit card.
She, however, says the problem with travel insurance is that there is no clarity – an issue that became evident when her luggage was delayed for three days while she was travelling from Copenhagen to Basel.
“I was alone and did not know how to go about making a claim, nor did I know how much I was entitled to.”
She managed to get a token sum from the airline, which paid for a made-in-Malaysia
t-shirt that ended up being one size too small.
The only time P. Anna did not sign up for travel insurance was the one occasion she needed it most.
What was to be a grand tour of Nepal ended with the yoga instructor and her 21 tour mates battling a severe bout of diarrhoea and vomiting.
About to keel over with a soaring temperature and dehydration, she was admitted to the nearest hospital.
The nightmare continued when the group were told that the airline they were to fly out on had gone bust and they were stranded for another week.
With not much money left after paying the medical bill and hotel accommodation, the holiday was memorable for all the wrong reasons.
The General Insurance Association of Malaysia (PIAM), comprising 30 members, reminds Malaysians to “always read the fine print” as travel insurance coverage is usually limited to the period of travel.
“Insurance companies offer various protection packages, so be sure to purchase one that is specific to your needs.
“Travel insurance provides peace of mind because if things go wrong, there will be recourse and financial protection against any inconveniences.”
Having a life and medical policy does not render travel insurance redundant, according to PIAM. Both travel and life are a “benefits policy”, meaning that if death or permanent total disablement occurs due to an accident while you are travelling overseas, the claimant or nominee can claim under both policies, the association assures.
“A medical insurance policy, however, is paid on an indemnity or reimbursement basis, meaning that the insured will only get paid for what he has actually incurred and nothing more.
“The majority of medical policies limit treatment to hospitals located in Malaysia, so always check whether your insurer has extended the scope for treatment overseas,” it adds.
Travel insurance: What you should know
In Malaysia, travel insurance is global, affordable, and can be easily purchased from an insurance company, its agent or online. Most policies share common features, but there can be differences in the scope of coverage and the claim payment cap. Just remember to read the FINE PRINT.