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Covers For Carefree Travel

Private insurance players offer better products and services to outbound travellers, uncovers Manika Gupta

his is a classic case illustrating the comparison between the travel insurance policies offered by public sector undertakings and the private players. In November 2001, a mother-daughter duo went abroad. The mother had bought a policy from a public sector undertaking (PSU), and the daughter had it from a private sector player. The mother fell ill in Mexico and had to be hospitalised. She was admitted to a hospital affiliated with the PSU. She had to pay her own bills with the expectation that they would be reimbursed later on by the insurance company. She is still engaged in paperwork.

The daughter fell ill in Washington, DC. She had to be shifted to a hospital, which was not even affiliated with the private insurer. But she got her reimbursement within months. The delay, she explains, was partly because of the forex transfer.

So, which product should one choose for quick issuance, less cumbersome documentation, the plans offered and claim settlement? The competition is between two government-owned companies, New India Assurance Company and Oriental Insurance Company, and private players like Tata AIG and Bajaj Allianz.

“The PSUs suffer mainly on account of issuance and settlement of claims,” says Divya Narang, an executive in the general insurance department of Bajaj Capital, an insurance product distributor.

PSUs even have more or less standard plans. While they cover only accident and sickness expenses, hospitalisation, emergency (medical) evacuation, repatriation of remains and baggage loss, the private players also cover the baggage delay, loss of passport, flight delays etc. If there is a delay in take-off by more than 12 hours, one is given US$ 10 for meals.

Issuance of policy in case of PSUs may take anywhere between three-four days. One has to fill out seven to eight pages and get a medical check-up done before one can get a travel policy. On the other hand, in the case of private sector, the procedure is simple and the form is not lengthy. “Private insurance policies are designed in such a way that the whole process takes not more than 15 minutes,” claims representative of a travel policy distributor. The policy document to be carried along is only one page or of the size of a small ID card.

The basic policy from private insurers, like Tata AIG starts at Rs 651 per person for a two-week trip as against Rs 642 from Oriental Insurance and Rs 645 from All India Assurance for the same period. Emphasises Devesh Kumar, a manager at Oriental Insurance: “Our basic policy is cheaper than the travel policies elsewhere.”

Says frequent flier Saurabh Mishra, who is a senior executive with Tata Consultancy Services: “The premium for a private insurance policy is Rs 5 or Rs 10 more than a PSU policy, but the add-ons and the value for money is incomparable.”

In case of a PSU policy, you have to be admitted only to an affiliated hospital and settle your own bills, which are reimbursed once you are back in the country. Kumar admits: “The claim settlement in PSU companies does take a very long time due to red tape, but we are in the process of streamlining.”

In case you are holding a private insurance policy and need help, all you have to do is to call up the insurer, give your policy number and contact details. They contact you immediately and refer you to the nearest affiliated hospital.

But, if for some reason you are not able to travel and are looking for a refund, be it the PSU or the private players, they all are bound to disappoint you the same way. They have no refund provisions.