How to Calculate the Premium on Travel Insurance
Did you know that the premium rates on travel insurance are the highest in Japan, among all the Asian destinations, because it is prone to natural disasters, such as earthquakes and tsunamis? Similarly, you should also know that premiums would be higher when you seek insurance for traveling to countries like Canada and America, since medical expenses are high here, especially in comparison to South East Asian countries.
Budgeting for Travel Insurance
Holidays are essentially about budgeting, and allocating the cost of insurance should be part if this. In order to arrive at travel insurance premiums that might be comfortable for you, it would be important to have a fair idea of the factors that determine the amount of premium you will have to pay for your policy, whether you travel to an international or Indian destination. Some of the key factors have been discussed here for your benefit.
Factors that Determine the Premium for a Travel Insurance Policy
Some of the key factors that influence the premium that you pay on your travel insurance policy include:
- The Sum Insured: The amount of sum you wish to insure will naturally determine the premium you will have to pay. The higher the sum, the higher would be the rate of interest charged. Remember to take the destination into account when you decide on your sum insured. Medical coverage costs would be an important component of the insured amount for your travel insurance.
- The Type of Insurance Plan: Prominent types include the single trip plan, multi trip plan, student plans, senior citizen plans and so on. Your premiums would be calculated on the basis of your choice.
- Coverage: Depending on the nature of your holiday, you can always seek added cover from your travel insurance plan. For instance, you could add home insurance, cover for risks associated with adventure sports and insurance for expensive items and important documents to the cover. And all these extra covers would attract a higher premium.
- Duration of Stay :Your premium will be directly proportional to the duration of your stay.
- Travel Destination :As has been discussed earlier, the destination can determine the premium on your insurance plan.
- Health and Age :Age and health are important determinants for underwriting the policies of your travel. For instance, pre existing conditions as well as conditions arising out of drug abuse or alcoholism may not be covered by travel insurance.
Buying your travel insurance online is a great idea. Just make sure you have carried out a comprehensive evaluation before choosing a policy.