Who doesn’t love a freebie? Whether it is a complimentary appetiser with your meal or a stay at a hotel, if it’s free, then, you are likely going to take advantage of it! And the people who understand this all too well are credit card issuers. If you have a premium credit card, there’s more than just a good chance that it includes complimentary travel insurance.
While credit card travel insurance is a great benefit to have, how does it stack up against a stand-alone travel insurance policy? Which one of these will ultimately give you better travel protection?
Let’s find out.
1. How Much Does Travel Insurance Coverage Cost?
Typically, your credit card comes with complimentary travel insurance cover up to S$1 million. That being said, there are usually terms and conditions for the coverage on your policy to kick in.
Most card issuers will require you to charge your entire trip to your card – from flight bookings, and hotel stays, to car rentals. At times, you may even have to notify your bank of your travel plans.
On the other hand, the cost of a regular travel insurance policy depends largely on the duration of your trip, where you are travelling to, and the kind of activities you are likely to take part in. On an average, a stand-alone travel insurance policy can set you back anywhere from S$25 (for a single trip plan) to around S$355 (for an annual plan).
And these are just basic travel plans. If you plan to buy insurance riders for adventure sports or pre-existing medical conditions, the costs will increase. Where stand-alone policies win, though, is the fact that the policy cover kicks in as soon as your purchase it. There are no hoops for you to jump through or any minimum spend to meet.
2. The Flexibility of Choice
Credit card travel insurance coverage is the same for all credit cardholders. You can’t tailor the policy to fit your needs. If you plan to go rafting on your holiday or paragliding, and if something were to go wrong, you are on your own if you rely on your credit card travel insurance.
The same can be said for regular policies. However, the only difference being that regular policies come with several add-on options which provide additional coverage. Additional coverage is available for activities such as bungee jumping, hot-air ballooning, scuba diving, and skiing, among others.
If you know that you are going to participate in an activity or sport that isn’t covered by your credit card insurance policy, it would be a good idea to buy a stand-alone policy along with additional coverage in the form of an optional add-on.
3. Pre-existing Medical Conditions
Pre-existing medical conditions have always been a bone of contention between policyholders and their insurance companies. While most stand-alone policies do not provide coverage for pre-existing medical conditions, their coverage for medical conditions, more often than not, includes coverage for diabetes and asthma.
You can also purchase a travel insurance plan, such as NTUC’s Enhanced PreX Travel Insurance Plan, that provides comprehensive coverage for pre-existing medical conditions.
4. Protecting Those Travelling With You
The travel insurance provided by your credit card usually provides coverage for you – the cardholder. In some cases, the insurance policy also covers your spouse and children. However, the travel inconvenience benefits such as cover for baggage delay/loss, flight delay, trip cancellation, etc. are only extended to you and not your family, in most cases.
A stand-alone policy is way more generous in this regard. They usually provide coverage for you and your dependents. You can also choose to buy a joint policy that provides separate, but comprehensive protection for both you and your spouse.
There is also the component of age limit with credit card travel insurance to consider, i.e. many policies do not cover any member above a certain age. What happens if you are travelling with elderly family members?
So, Which Travel Insurance Should You Use?
Can you use the travel insurance policy provided by your credit card? Well, of course, you can.
The real question is, should you?
If you think that the policy that your credit card offers is good enough and that you won’t need any add-on options, then it’s fine to stick to your credit card policy. If you are travelling to a country that is close by or your trip is for a short duration, then it makes sense to use the travel insurance provided by your credit card.
If, however, you are looking for protection that covers all aspects of your holiday, or your trip duration is lengthy, then you consider a stand-alone policy.
Standalone policies offer a wider range of coverage as well as to a higher level. Moreover, they also provide coverage for your dependents. And if you plan to indulge in some adventure sports, then a stand-alone policy that provides additional coverage is your best bet.
While travel insurance does protect you from any unforeseen situations that may arise while on your holiday, the real protection is knowing exactly what you are signing up for, as well as understanding the policy exclusions and limitations. If travel is food for your soul, then go ahead and indulge with no worries. That’s what travel insurance is for.
This article was written by BankBazaar.sg.
BankBazaar.sg is a leading online marketplace in Singapore that helps consumers compare and apply for a credit card, personal loan, home loan, car loan and insurance.
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