Travel insurance and travel takaful: choosing cover for a trip

Why insurance matters on a trip

A medical emergency abroad, a cancelled flight or lost luggage can cost far more than the policy. Hospital fees differ widely between countries, and some destinations expect proof of cover as a condition of entry or of a visa.

Cover is most useful for the events that are hard to pay for out of pocket, such as hospital treatment and repatriation. Small delays are less important than a serious illness.

Travellers with children, older relatives or health conditions have the most to gain from reading the details before choosing a policy.

Conventional insurance and takaful

Conventional insurance is a contract in which the customer pays a premium and the insurer takes the risk. Many scholars object to features such as uncertainty and interest. Takaful is the alternative: participants contribute to a shared fund from which claims are paid, under the supervision of a Shariah board, and the operator manages the fund for a fee.

Views differ between scholars and between countries, and some travellers accept conventional insurance when no alternative exists. Each reader should follow their own school or a scholar they trust.

In practice, a takaful operator calls its payment a contribution, and any surplus in the fund may be shared or retained according to the rules of the scheme; ask the provider to explain this.

Takaful products for travel

Takaful Malaysia, an Islamic insurer, offers travel cover through Takaful myMabrur, which includes benefits such as flight delay and lost baggage. Etiqa, a Malaysian insurer, lists a travel takaful product called TripCare 360 Takaful.

Both are Malaysian, and their products are aimed at that market. Check the website of the provider to see whether a policy can be bought from your country, which trips and age groups it covers and who is eligible.

A policy bought for a pilgrimage, a ski holiday or a long journey with several stops may need a specific extension, which the provider can quote.

What a policy should cover

Compare the cover under the main headings: emergency medical treatment, repatriation, trip cancellation and interruption, baggage, personal liability and delay. Pay attention to the limits, the excess and the exclusions, which are more important than the headline benefits.

Check whether pre-existing medical conditions, pregnancy, sports and activities such as skiing or diving are covered. Some policies exclude them unless an extension is added.

Pay attention to the age limits and to the maximum length of a single trip, since an annual multi-trip policy often caps each journey at a set number of days.

• Medical and emergency transport limits.
• Cancellation conditions and proof required.
• Excluded activities, ages and conditions.

Hajj, Umrah and religious travel

Pilgrims should read the policy to see whether travel for religious purposes is covered and for which periods. Large gatherings, crowding and heat can raise the risk of illness, so medical cover matters.

Ask the provider to confirm in writing that the policy is valid for the places you will visit and for the full duration, including any extension. Check also whether the official authority requires specific insurance for your visa or pilgrimage.

Whatever the provider, keep the policy number, the assistance line and a copy of the certificate in your phone and in printed form, since pilgrimage sites and airports can have poor mobile coverage.

Comparing offers and reading the fine print

Price is only one criterion. Compare the contributions or premiums for the same level of cover, the excess you would pay and how claims are handled, including whether the insurer pays hospitals directly or reimburses afterwards.

Read the definition of terms such as 'medical emergency' and 'pre-existing condition', and find out which documents are accepted as proof. A clear, plain-language policy document is a good sign.

If you travel often, compare a single-trip policy with an annual one, taking into account how many trips you will really take.

Making a claim and common mistakes

Keep receipts, medical reports, boarding passes and any police or airline report. Notify the insurer as soon as possible, because many policies set a deadline, and call the assistance line before incurring large costs when the policy requires it.

Frequent mistakes include buying cover after a problem has appeared, ignoring exclusions for activities, forgetting to declare a medical condition and assuming the cover applies automatically through a credit card. Check these points before departure.

After returning, keep copies of every document sent to the insurer, and follow up in writing if the claim is slow.