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Skimping On Travel Insurance Will Cost You Way More
Monday, 30 May, 2022
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How Much Do You Think you'll need?
So, you’re booking a holiday and you’re going to need travel insurance how much do you need?
Or
You could be looking to get an annual multi-trip policy for when you travel for business. And you’re wondering the exact same thing?
We’ve talked before about some countries having minimum cover requirements. Though these tend to be less than the level of cover that you’d want to have.
At the end of the day most of us aren’t going to make a claim. And that’s the way that we want it. Right?
That’s not why we have insurance though is it?
When the shit hits the fan we want to know that we’re covered and that there is what insurance is for!
So how much do we need?
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That's The Perfect Amount Of Travel Insurance
Sorry to say there’s no such answer and as with most things in life then it comes down to “It all depends”
There’s several factors that will make a difference to how much cover is going to be enough.
Now, we’ve said this before and I’m sure that we’ll say it again!
The main reason for having travel insurance, is to cover potential medical expenses.
There’s other things to claim for, trip cancellation or lost/damaged possessions
Though in the big scheme of things then these are completely insignificant!
Because the financial impact that they’ll have on you won’t make a massive difference to your life
Medical expenses can and will, though!
If the unthinkable happens then the cost of treatment could prove to be devastating
And leave you in a financial hole for the rest of your life
So, this is what we’re insuring against
What are the key factors that we should consider when we ask how much is enough?
Here’s the important stuff to take into account that’s going to make a big difference:
Destination
Activities
These are the two things that are going to make the difference to how much cover you should have.
Let’s start with the the most important…
Destination
Why where you makes a difference to how much travel insurance you need!
The reasoning behind this is quite simple!
The cost of healthcare varies from one country to another
The more it costs in a certain location means the more cover you’re going to need
What you may not appreciate is how much these costs can vary from one location to another
So we’re going to take a deep dive into this so you fully appreciate the difference it makes
And what you need to do to plan for it
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medical costs around the globe!
So this isn’t going to come as a surprise to many of you but the USA tops the charts when it comes to medical costs…
Not only that the trend continues when it comes to medication also
A bypass operation in the US will cost you in the region of $80,000 for the operation alone. Then on top of that there’s going to be aftercare, room, medication, scans and the treatment
Now if we use this as our benchmark we can compare medical costs in other countries.
Kind of like a medical McDonald’s test!
The cost of the same operation in New Zealand would be about 48% of our benchmark. In Australia then it would be in the region of 45% with the U.A.E & Switzerland at 40%. In the UK then the cost would run at around 35%.
As a visitor to Japan the same operation would be around 98% of that in the US. In South Korea you’d expect to pay 38% of the cost, Singapore 31%, Thailand 29% and Malaysia 23%.
In China you’d be looking at 26% and in Taiwan it would be 38%.
In France it would be 50%, Germany 22%, Spain 20%, Poland 11%, and Turkey 18%.
If we move onto Africa then Egypt is 26%, Tunisia 19% and South Africa 38%.
Now for the Americas starting with Argentina 21%, Canada 86%, Costa Rica 33% and Mexico 33%.
You get the idea, Right?
The USA is one of the most expensive places that you can go to if you need medical attention. You can easily wrack up $250-350K in a short space of time.
It’s much better to over-insure that it is to have too little.
So if the USA is on your destination list, you’ll need at least $500K of cover.
so, that's the USA what about other places?
The percentages above give some indication of the differences in costs.
Though these are not uniform across all procedures and healthcare systems.
Also, just because the cost of a bypass in Thailand is 29% of one in the USA. That doesn’t mean that you can’t run up a massive medical bill there, because you can.
Search the internet and you’ll find people who went on holiday to Thailand…
And ended up with a hospital bill over $300K!
Granted, it doesn’t happen all the time, though, it happens and guess what?
There’s no way of knowing exactly when it will happen, Right!
And that there is the whole point of having insurance and making sure you’ve got adequate cover!
So, whilst the entry requirement for Thailand is $10K insurance cover. That isn’t anywhere near enough that isn’t going to get you out of the shit, is it?
We’d recommend that even if you’re traveling to a country with reasonable costs. You should be looking at having $250K minimum cover for your travel insurance.
Here's something else about location and travel insurance that we need to talk about
I’m sure that you’re aware of this though you may not have thought about the implications of it…
Not all healthcare systems provide the same quality of care!
You could find yourself in a situation where you can’t get the treatment that you need where you are…
Now that could be because you’re in a remote area that has basic facilities
And if you move to a more built up area then you may be able to get the care that you need
The issue could be bigger than that and you may not be able to get the necessary treatment in the country you’re in
Which would mean that you need moving to a neighbouring country that’s got what you need
Or you may need transporting back to your country of residence where you can get looked after
Now much of this will depend on your situation
The more serious it is the more complicated it’s going to be to move you
The more complicated it is to move you and the more serious your health condition…
The more it’s going to cost to move you
The further they have to move you the more expensive it gets
When you have to move across national borders the more complicated it is and guess what?
Yes you got it the more it’s going to cost more
If you need moving by air, helicopter or plane then that’s going to be expensive. You could be looking as much as $300 per mile.
That’s going to add a significant amount to your treatment costs!
If you are travelling to somewhere that’s got a very limited healthcare system
Then account for that!
Make sure that your policy has evacuation coverage…
And also increase the overall benefit level of your policy to reflect this
If you want to know if the place that you’re visiting falls into this category. Then you can find this information at World Population Review
Now let’s move onto the other factor that’s going to have an impact on how much cover that you need…
Activities
Before that though…
If you want to know more about travel insurance and what you need to do to get it RIGHT…
Then click below to “subscribe” for our FREE Travel Insurance Secrets guide…
Plus you’ll get our Travel Insurance Email series!
Subscribe And Get...
Our FREE "Travel Insurance Secrets" Guide And "Travel Insurance" Email Series
Why What You Do Makes A Difference To How Much Travel Insurance Cover You Need
First of all if you’re taking part in hazardous activities…
Then the chances of you making a claim is going to increase
The first thing that you’ll want to make sure of is that you’re covered for such activities
Some policies will cover some of these activities as part of the standard policy. If this is the case you may find that some more extreme activities aren’t covered.
Others will involve you adding then to the policy at an extra cost
Now if you’re doing activities that travel insurance companies won’t cover. Even for an extra fee…
Then you may need to go and find a specialist policy that will!
Depending on what activities you’re doing then this may take you off the beaten path
Get injured or fall sick here and this could mean that you have to be rescued
Again as with the evacuation this isn’t going to be cheap
And as a visitor to someone else’s country you’ll be expected to pay for this
If you don’t have an adequate enough benefit sum then you’ll be expected to pay the difference
You’ll want to make sure that the policy covers evacuation and rescue. Though this may involve adding this to the policy.
If you have to add it as an extra to the policy then it’s likely that it will have a separate allowance amount
If it is included in the policy as standard then it would be worthwhile adding an extra $50K to the cover amount
One other thing that effects the amount of travel insurance you need
Finally there’s one other thing that’s going to impact how much cover you’re going to need.
And that is a pre-existing condition!
So you can get cover for this, you’ve got to get the right policy
What they won’t cover is the ongoing management of the condition (which is fair enough)
They will provide cover for a chronic reoccurrence, which is what you want…
Because, that’s the expensive bit
Why does this result in you needing more cover?
Ongoing conditions don’t tend to improve with time
So the likelihood is that the treatment that you’ll need will get more involved
So, if you have had health issues in the past (depending on the seriousness)
Then you might want to make sure that you add an extra $150-200K to the amount of cover you intended taking
So now you have an idea of how much travel insurance you want
Now, we know that no one wants to spend more than they need to on travel insurance
Though having too little will end up costing you a lot more if it comes to that
Now you’ve got an idea of what you need depending on where you’re going and what you’e doing
If you’re looking for a a multi-trip annual policy then base your cover amount on…
The destination with the most expensive health care
If you want to know more about travel insurance and what you need to do to get it RIGHT…
Then click below to “subscribe” for our FREE Travel Insurance Secrets guide…
Plus you’ll get our Travel Insurance Email series!
Subscribe And Get...
Our FREE "Travel Insurance Secrets" Guide And "Travel Insurance" Email Series
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