In the middle of the summer travel season, we highlight the importance of travel insurance for policyholders. A typical travel insurance plan for around a week to the USA costs less than ₹1,500 per person. But ignoring the same for international trips can introduce a significant financial risk even on a short trip. Also, the number of exigencies covered even by the cheapest travel insurance plans makes such a cover all the more necessary.

At the outset, we will address the critical question. Travel insurance does not cover war-related triggers for a claim. Flight rescheduling, cancelled hotels or trip cancellations arising from wars, conflicts or government actions are not a basis for claims. Also, travel insurance may be void if the policyholder is travelling to a destination that has been placed under a government travel advisory. But the other ‘regular’ risks covered by travel insurance are comprehensive.

Medical emergencies

The primary risk is that of falling ill on a foreign trip, considering the cost of healthcare for the uninsured in a developed country. Travel insurance policies generally provide medical expenses cover of $200,000-$500,000.

But this cover is for unplanned medical emergencies and the medical care provided will most likely be limited to emergency treatment to allow for travel back home and not comprehensive care. Travel insurance plans also cover medical evacuation, up to the sum insured, to transport the policyholder back home for medical conditions.

If the ailment is a pre-existing condition (PED), which must be declared at the time of issuance, the claim may not be supported. But some insurance companies, Tata AIG for instance, cover PED treatment but up to a lower cover of $30,000 only. In the unfortunate case of death or disability during the trip, plans provide personal accident cover of $20,000 along with repatriation of mortal remains.

Travel insurance plans also accommodate incidentals like a daily allowance during hospitalisation ($125-$150 limit), ambulance charges of $500 and OPD charges for consultations. These factors, while manageable in India, can strain finances in a foreign country.

Trip cover

While medical care is one of the primary concerns, the other risks in travel arise from trip logistics themselves.

Travel insurance can pay up to $750-$1,000 to cover non-refundable bookings if the trip is cancelled. But the reason for cancellation can be serious illness, injury, extreme weather or an accident. A cancellation on account of external disturbance like a war cannot be a reason to trigger a claim.

Similarly, cover of $500 is also provided to compensate for a return trip due to an unplanned emergency (affecting not the policyholder but his/her family).

Travel plans also accommodate an upgrade to business class in case of an injury with a limit of $1,000. Flight delays or missed connections are covered with a limit of $150-$300 as well.

Travel insurance also addresses a range of baggage-related contingencies. For instance, in the event of the loss of a passport, an international driver’s license or other travel documents during travel, policies typically reimburse the cost of obtaining a replacement, usually within a range of $300 to $500.

Similarly, if checked-in baggage is lost or significantly delayed by the airline, the policy can compensate for the purchase of essential items until the baggage is recovered or delivered, up to a limit of $100-$200.

Additionally, many plans extend personal liability cover of $100,000 to $200,000, offering financial protection in the event the policyholder faces a legal claim from a third party during the trip.

Travel insurance covers not only health and logistics but also theft at home while the policyholder is on the trip, with a cover of ₹50,000.

Fraud or scams while on a trip are also addressed in some policies, up to a limit of $500.

All in all, travel insurance is a must-have companion on a trip with many features. But policyholders must note that a deductible applies to claims, which affects the payout to an extent. Also, the coverage, premiums and features may vary across insurers. Policyholders should go through the fine print to assess if their risk priorities are covered.

Published on May 23, 2026