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Is Travel Insurance Necessary If You Have Medical Insurance?

BY Team Loanstreet

Updated 29 Apr 2022

You must've been wondering... "What’s the worst, non-death related thing that could happen to you while on holiday?" For most people, it is ‘medical emergencies’. ‘Flight cancellation/delay’ usually comes a close second. Thus, many people believe that their regular medical insurance plus flight insurance is sufficient.

But, here’s what you don’t know: Your regular medical insurance typically DOES NOT cover accidents that happen overseas! And if it does, it’s usually as a reimbursement, which means you have to pay for the cost out of your own pocket first, then claim it within 30 days after returning home.

Imagine having to use up all your vacation funds because you sprained your ankle!

What's covered in this article?

What are the differences between Travel Insurance and Medical Insurance?

Travel Insurance is a comprehensive, end-to-end coverage for the duration of your trip. This means flights, luggage, medical, and even home coverage. Medical Insurance is a long term plan that is expected to last your whole life. Hence, when it comes to international coverage, you are subject to the clauses in your policy, and almost always as a reimbursement. This is not very helpful when you’re overseas and in need of insurance!
Data from Allianz Insurance shows that the most common medical emergencies abroad are Fractures/Falls, Cardiac Arrest, Accidents & Trauma, and Pulmonary problems. All of these WOULD NOT be covered under your medical insurance, or if they are, it'll be reimbursed to you at a minimal amount. You have to decide how much are you willing to risk, should you be caught in a foreign country with unfamiliar medical procedures and astronomical costs.

Did you know that outpatient care is one of the most common claims under Travel Insurance?

In the United States, a trip to the emergency room costs, on average, USD1300. In Australia, it costs AUD380. In the Philippines, it costs about USD200. Without travel insurance, you will need to fully pay this cost as your medical insurance will not reimburse you for outpatient treatment.  This also includes coverage for prescription medications. As a rule of thumb, as long as the condition you sought treatment for is covered by your travel insurance, the prescriptions will be as well.

As outpatient care is one of the most common claims under Travel Insurance, it is highly recommended to invest in a Travel Insurance plan, as the premium per single trip can be as low as RM 8. Thinking you’re ‘saving’ RM 8 by testing your luck is rather like not paying for parking - it’s nice when you don’t get fined, but then the traffic police only needs to get you once and bam, it’s RM 300 down the drain - except, in this case, we’re talking about your health and thousands of ringgit.

If there's an emergency reunion, who will come for you?

Should you find yourself alone, suffering a serious illness or injury abroad, your Travel Insurance will usually pay for a round-trip ticket for an immediate family member to visit you. This means what you don’t have to endure the worst time of your life alone.

How far does Travel Insurance stretch, when it comes to holiday activities?

While this may seem terribly obvious, many people DO NOT realise there are clauses for certain regions or countries in regular medical insurance policies. Most travel insurances, however, offer global coverage. Some have extreme sports coverage, insuring you if you, for example, break a leg snowboarding in the Tatra Mountains of Poland. If you’re an exotic or adventurous traveller, you will need to pay more attention to your package details.

Having said that, take note of the Exclusion Clauses - your personal responsibility

Every single type of insurance has exclusion clauses that protect the interest of the insurance company. Most have exclusion clauses that include Personal Responsibility. This means suicide, self-inflicted injury, sporting competitions, certain pre-existing conditions, and going on a holiday for the sole purpose of receiving medical treatment (i.e medical tourism) are usually excluded from travel insurance and medical insurance coverage.

Therefore, it’s always important to read your policy in its entirety before signing the dotted line. Whichever provider you choose, make sure you don’t skimp on travel insurance when you enjoy that hard-earned holiday, because yes, travel insurance is absolutely necessary for a great holiday and peace of mind!

Now, if you're looking for an affordable Travel Insurance, head over to Loanstreet's travel insurance page. Purchase it online within a few minutes.

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About the Author

Team Loanstreet

Run by a professional human-sized team, get resourceful tips & guides from our very own library of financial articles that can help improve your financial lifestyle & make a well-informed money decision. We strive to provide you with the best service in helping you to get the most out of that DUIT!


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