Whenever I go overseas for a holiday, I will buy the travel insurance. Recently, it comes to my mind on whether there is a need to do so. The reasons are as follows:
- The travel policy covers loss of luggage, flight delay and other risks. The amount of compensation is quite small about few hundred or so.
- If one falls ill during the holiday, the medical expenses may cost a few hundred dollars. The chance of making a claim is rather low.
- If the chance of a claim is 1 in 100, it may be worthwhile taking a risk. The saved premium on 100 trips would probably cover any future claim.
- The risk can be covered under the personal accident. A personal accident policy may be insured by paying an annual premium of $600. This covers one for accidents 365 days, 24 hours a day, in Singapore and overseas.
Based on the above reasons, it is advisable to avoid buying travel insurance.