provides for emergencies that may arise during the trip.
Deductible or excess is the amount that the Insured has to bear before the insurance Claim can be availed. It is an acceptance by the insured person to bear this minimum cost. As in motor insurance, Travel Insurance also has deductibles for various heads. Some of the deductibles are compulsory. That is, the Deductible forms a part of the Policy and is fixed for a specific sum Assured by the insurance company. The insured has to bear this cost.
While taking insurance, one has a choice to increase the amount of deductibles under various heads, called voluntary deductibles. So, voluntary deductibles allow the buyer to fix the deductible in addition to existing compulsory deductibles.
When one opts for voluntary deductible a major Risk is borne by oneself. In case of claim, the insurance company might have to pay lesser amount. The insurance company therefore charges lesser Premium for their customers taking higher deductibles.
On one hand, deductibles reduce the premium, on the other hand in case of a claim, one has to be prepared to pay more from pocket as individual liability becomes more. Compulsory deductibles are clearly mentioned in the policy document. The list may vary based on the type of policy and insurance company.
In case of hospitalization, one has to bear this minimum cost and the insurance company pays only if the cost of treatment exceeds this. Depending upon the policy one has to bear a minimum cost of medical treatment overseas that cannot be claimed.
Cost of dental treatment in emergency situation is reimbursed only after the deductibles payment by the insured.
Passport loss is covered under travel insurance for Reimbursement of the expenses resulting due to the loss. Depending upon the insurance company and type of policy, the deductible amount is fixed in case of loss of passport.
The deductible in case of checked baggage delay is duration. You are not paid for first few hours of baggage delay which is generally 12 hours delay. There after you are reimbursed as per the policy schedule.
Just like in case of baggage delay, flight delays are also not covered for first few hours of the delay. You are reimbursed for flight delay for the duration starting after this time as per the policy.
Many insurance companies provide cover in case the carrier (plane or the ship) is hijacked. The cover kicks in only after first few hours, generally 12 hours, after the hijack.
If an insurance company is covering home burglary, there usually is a deductible involved. Losses up to a minimum amount as mentioned in the policy are not covered.
Travel insurance sun heads mentioned here are the most common ones that have deductibles. An insurance company may implement them under other heads as well depending upon the type of policy and Coverage amount.
Any claim when presented to the insurance companies is subject to the deductibles even if you have not opted for any voluntary deductibles. If opting for any voluntary deductibles, keep the amount to levels that can be conveniently borne by you. After buying the policy, it is always advisable to read the policy document carefully to avail maximum benefit if a claim situation arises.