Most UAE residents lack adequate travel insurance cover

Dubai: UAE holidaymakers risk spending hundreds of thousands of dirhams, or more, abroad by neglecting to secure the right travel insurance policy before hopping on a plane.

Recent estimates done by independent financial advisor Nexus Group showed that an alarmingly low number of residents in the country, less than one per cent, are covered by a comprehensive travel insurance plan. What most people do obtain, is a travel policy that provides the lowest possible amount of coverage just to comply with a requirement, such as when processing a tourist visa.

Financial advisors warned that buying just any insurance could prove to be costly, as not all policies provide comprehensive coverage. Some only shoulder a very low amount of hospital expenses or won’t pay out in case the bags are stolen, the passport gets misplaced, the flight gets delayed, or the traveler gets hospitalized in the United States, Canada or in a foreign country where medical bills are excessively high.

An insurance policy that promises $250,000 worth of coverage may sound like good enough, but in reality, it may be insufficient if the traveler gets seriously ill or injured.

In the United States, hospital bills could hit approximately $10,000 daily, while sending the traveler back home for emergency treatment could easily set someone back $100,000, according to World Nomads, which provides online travel insurance service

“Medical treatment in foreign countries can cost tens of thousands, which is why it’s essential to have a travel insurance policy that will cover you, should you need it. Travel insurers pay £1 million a day for cancelled trips or to cover medical costs and offer support during an emergency abroad,” said Mark Shepherd, manager for general insurance at the Association of British Insurers.

Some insurance experts have advised that travelers would be adequately protected if their insurance policy provides up to $1 million worth of coverage and is valid in countries like United States or Canada.

“[However,] many residents [in UAE] rely on travel insurance that banks offer as part of a membership or credit card package, or that which is required by the Schengen visa. The problem is that such policies tend to offer very limited cover, and are often not sufficient when it comes to claiming incurred losses,” said Phil Ashkuri, head of general insurance at Nexus Group.

Ashkuri said the trend “urgently needs to be addressed,” especially since travel is a prominent part of UAE residents’ lifestyles.

He said most people tend to associate travel insurance only with delayed baggage, loss of passport or personal accident. But what most travelers fail to consider is that they need adequate coverage that will pay for all their medical bills in case something bad happens.

“Most insurance companies offer travel policies with and without US and Canada coverage because of the cost of healthcare in those countries,” noted Ashkuri.

Medical expenses in the United States, Nexus said, can run up to hundreds of thousands of dollars, while a Schengen policy only covers emergency medical expenses and not those associated with flight and baggage delay, or loss of personal items.

“Similarly, people should not assume that their home contents policy will cover them internationally in the event of theft or loss of personal belongings,” added Ashkuri. 

“For example, if you are backpacking through Europe and suddenly have all your valuables taken from you, you need to know that you will be compensated for this loss. These details vary from policy to policy, but will make all the difference when it comes time to make the claim. It is crucial that people read and understand the fine print so that they are not left stranded should a disaster strike.”



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