While many consumers may have already planned their travel itineraries for the upcoming Easter holidays, some may make last-minute purchases of travel insurance, without fully grasping the extent of coverage. The Consumer Council surveyed 27 single trip individual travel insurance plans and found that the maximum benefit limits for adults could vary by up to onefold among plans with similar premiums, while the scope of coverage across different plans exhibited considerable disparities. Furthermore, excluding 3 plans which charged seniors a higher premium, a staggering 92% (22) of the plans reduced the maximum benefit limits for “Medical Expenses” and/or “Personal Accidents” for the elderly and children, despite these groups often paying the same premiums as adults, with the highest being a 75% reduction or even omission from certain coverage items. While the Council acknowledges that these adjustments may stem from risk management considerations, but since consumers may not fully understand these distinctions at the time of purchase, the industry is recommended to regularly assess the adequacy of travel insurance coverage for seniors and children, and to consider raising both the maximum enrolment age and the maximum benefit limits for these 2 consumer groups. In addition, consumers should carefully compare the scope of coverage and benefits of various plans to ensure they align with their needs and those of their travel companions, rather than merely considering the premium or defaulting to their regular insurance company.
Between February and March this year, the Council gathered information from the websites of 11 insurance companies, covering 27 single trip individual travel insurance plans (excluding optional/add-on coverage items requiring additional premium and travel insurance plans specifically for short trips to the Mainland and Macau, or cruise holidays). 10 surveyed companies provided 2 to 3 plans with different scopes of coverage for consumers to choose from, while the remaining company only had 1 plan available. Taking for instance a 7-day trip in Asia, excluding the higher premium charged against individuals aged 76 or above by individual insurance companies, the premiums for individuals ranged from $145 to $509, while that for a 14-day trip across destinations worldwide ranged from $241 to $859.
Benefits for Medical Expenses Varied by Onefold Among Similar-priced Plans
Out of the 11 surveyed insurance companies, 10 offered 2 to 3 different plans. Typically, a higher premium correlates with a broader scope of coverage and increased maximum benefit limit for coverage items. It is essential for consumers to assess their personal needs before deciding. However, consumers should be mindful that the benefits and coverage scopes could vary significantly even among plans with comparable premiums from different insurance companies. For example, among the 7 travel insurance plans for a 7-day trip in Asia with a premium under $200, the maximum benefit limit on “Medical Expenses”, one of the items consumers are most concerned about, was found to range from $250,000 to $500,000 for an insured adult, representing a onefold difference; 1 of the plans had more exclusions, such as “Baggage and Personal Property”, “Personal Money and Travel Documents”, “Delay or Interruption”, “Rental Vehicle Excess”, etc. Moreover, only 2 plans covered the damage or loss of mobile phones and computer devices respectively, with the maximum benefit limits being $2,000 and $5,000 respectively. Consumers should carefully compare the coverage scopes of different plans before taking out a policy.
18 Plans Fully Compensated Emergency Medical Evacuation
In the unfortunate event of illness or accidents while travelling abroad, indemnity for medical expenses is crucial. All 27 plans included “Medical Expenses” coverage, indemnifying medical, hospitalisation and treatment expenses arising from accidental injury or illness during the trip, as well as the cost of follow-up medical treatment upon return to Hong Kong. The maximum benefit limit for an adult varied from $100,000 to $1,500,000. 21 plans offered “Overseas Hospital Cash Allowances”, with maximum benefit limits for adults ranging from $2,000 to $12,000 and “daily” payout ceilings from $200 to $500, equivalent to around 4 to 50 days’ allowance.
15 plans included coverage on “Personal Accidents” as a benefit pool for death or permanent disablement of the insured person arising from “Accidents on Public Transport” and “Other Accidents”, with maximum benefit limits ranging from $250,000 to $2,000,000, a significant disparity. In case of serious incidents or even death, all 27 plans provided “Emergency Assistance”, covering expenses required for “Emergency Medical Evacuation”, “Repatriation of Mortal Remains”, “Compassionate Visit” and “Return of Unattended Dependent Children”. 18 plans would fully indemnify necessarily incurred charges for “Emergency Medical Evacuation”, 16 would fully indemnify necessarily incurred expenses for “Repatriation of Mortal Remains”, while the remaining plans all set a payout ceiling, such as maximum benefit limits ranging from $200,000 to $3,000,000 for “Emergency Medical Evacuation”. As for “Compassionate Visit”, all plans would only cover reasonably incurred travel, pick-up and accommodation expenses for 1 to 2 family members. Consumers must remember to contact the insurance company via the 24-hour emergency assistance service hotline if “Emergency Assistance” services are required, and allow their authorised emergency services provider to arrange and provide such services, otherwise the related expenses might not be reimbursed.
Only 9 Plans Without a Maximum Enrolment Age
Benefits for Seniors and Children Generally Lower than Adults
The survey also revealed that seniors and children might not enjoy the same benefits as insured adults despite mostly paying the same premiums. 92% (22) of the plans lowered the maximum benefit limit on “Medical Expenses” and/or “Personal Accidents” for seniors and/or children, of which 1 insurance company’s 3 plans even halved the maximum benefit limit for insured persons aged 75 or above and 17 or below for some coverage items, including “Medical Expenses”, “Other Accidents”, “Baggage Delay” and “Trip Cancellation”. The 2 plans from another insurance company set a standard maximum benefit limit of $300,000 for “Personal Accidents” for insured persons aged 71 or above and 17 or below, equivalent to only 60% and 30% of that for insured adults. Although 3 plans provided seniors with the same benefits as adults, their premiums were around 27% to 36% higher.
It is noteworthy that 18 of the surveyed plans had a maximum enrolment age. Apart from 3 plans from 1 company which set a maximum enrolment age of 120, that for the remaining plans ranged from 79 to 85 years old. Compared to the Council’s 2023 survey on travel insurance (17 out of 26 surveyed plans had a maximum enrolment age from 80 to 85), although the plans in the current survey were not identical to the previous one, the data for these 2 items reflected similar trends.
Coverage Scope of Unexpected Incidents Varied
Only 3 Plans Offered Kidnap and Ransom Coverage
Travellers may encounter unforeseen events, such as loss of personal property or travel documents, flight or public transport delays, or even trip cancellation or curtailment due to emergencies. Close to 93% (25) plans provided coverage for “Trip Cancellation” and “Trip Curtailment”, compensating the insured person for losses arising from paid and non-refundable transportation or accommodation expenses, with maximum benefit limits ranging from $3,500 to $50,000. However, insurance companies may have different definitions of coverage items, generally including natural disasters, political unrest, outbound travel alerts (OTAs) issued by the HKSAR Security Bureau against overseas territories, severe injury or death of the insured person’s immediate family members, etc. If the trip is cancelled or curtailed for reasons not defined by the insurance company, it may fall outside the scope of coverage and thus not compensated.
22 plans provided a “Trip Delay Cash Allowance”, typically compensating for every 5 to 6 hours of travel delays with maximum benefit limits ranging from $500 to $5,000. For 1 insurance company, its 3 plans did not provide cash allowances, but instead offered the insured person use of its lounge services for trip delays exceeding 1 hour. 25 plans offered “Baggage Delay” coverage though their definitions and payout basis varied. If the baggage is delayed by 6 hours or more than its original arrival time at the destination, 12 plans provided the insured person with a one-off cash allowance with maximum benefit limits from $500 to $3,000; 6 reimbursed the insured person for purchase of essential items, while the remaining 7 only reimbursed the purchase of essential items when the baggage is delayed by 8 hours, 10 hours and 12 hours respectively, with maximum benefit limits ranging from $500 to $1,500. Self-drive tours have gained popularity in recent years. In the event of theft or damage to rental vehicle, 22 plans provided “Rental Vehicle Excess” coverage with maximum benefit limits from $2,000 to $10,000.
Recently, consumer concerns regarding personal safety when travelling to Southeast Asia have also surged. Only 3 plans from 1 company in the current survey offered “Kidnap and Ransom” coverage, with a daily payout ceiling of $500 per incident, and a total compensation limit of $15,000. The insured person or his/her family must report the case to the local police and obtain an official report in order to submit a claim. Other insurance companies recommended the insured person’s family to contact the Hong Kong Immigration Department, Hong Kong Police Force or relevant consulate for assistance. Furthermore, if the insured person contracts communicable diseases caused by coronavirus during their trip, only 3 plans from 1 company specified that this disease would not be covered.
When selecting a travel insurance plan, consumers may refer to the following:
- Different insurance companies may have varying definitions of coverage items. Consumers should carefully read the policy terms for confirmation and refrain from focusing solely on the premium and maximum compensation for individual items;
- Before taking out a policy, thoroughly understand the plan’s coverage scope, maximum benefit limits and claim arrangements, as well as whether some items have daily payout ceilings. If travelling with the elderly or children, be mindful that their coverage scope and maximum benefit limits may differ;
- Pay heed to exclusions, such as arranging emergency medical evacuation services without the insurance company’s consent, travelling to specific regions, or participating in high-risk activities. If planning to engage in higher-risk activities during the trip, such as skiing, hot air balloon rides, or scuba diving, check beforehand to ensure such activities are covered, to prevent non-compensation should accidents arise;
- Some plans provide coverage for trip delays or cancellations before departure, such as when the HKSAR government issues a black OTA for the destination or the insured person’s family member falls severely ill requiring trip cancellation. Since definitions of coverage items varied among plans, consumers should purchase travel insurance as soon as air tickets and/or hotel accommodations are confirmed, allowing time to understand compensation terms and claim limitations, and avoid last-minute purchases before departure;
- Remember to carry the insurance company’s emergency assistance hotline number and contact details of family or emergency contacts for contingencies. In case of travel delays, personal accidents, or hospitalisation due to illness during the trip, retain all written proof or original receipts to file claims with the insurance company, as well as noting claim deadlines.
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