If you are the one who thinks your travel company covers insolvency, you’re not alone. Most travellers expect their insurers to cover airfares, tour booking and accommodation fares if a travel agent busts. But unfortunately, most standard travel insurance policies in India, including HDFC ERGO Travel Insurance, don’t provide assistance for insolvency, a collapse of airline, hotels, tour operators, cruise operators etc. However, some state tourism boards in abroad, encourage the customers to purchase a travel insurance plan with insolvency coverage against the travel agent. But the fact is that only a handful of insurers exist that cover bankruptcy of a travel provider like tour operator or airline.
Having Travel Insurance with Insolvency Cover is good Having a travel policy with insolvency coverage saves you from being financially affected in the event of financial default of the service provider. Your travel expense will be compensated in case you’ve re-arrange your trip due to the bust of the service provider, hotels, resort operators, trip operator, car hire companies etc. Travel agent’s cancellation fees incurred will also be reimbursed due to any of these financial failures. Ways to Protect Yourself Travel via Agent: If you are among does who believes in ‘help yourself’ and arrange for all travel related things by own for your next trip, then you’ll be at risk when it comes to financial protection. Instead, we suggest you to go through a travel agent. This way, if the airline collapses, you might be able to get the reimbursed amount or in some cases, they may help you get home safely. Use Your Credit Card Always: It is always advisable to use credit cards over debit cards while buying travel arrangements. Using your credit card is a good way to ensure protection while making any purchase. In case of an unexpected situation, the credit card company might be able to recover your money. Read the Policy Document: It is mandatory to read the policy documents thoroughly. Whenever you get stuck in some points, do give a call to the insurer and clear your doubts before buying it online. Compare to Get Best Deal: Before buying, you can compare travel insurance policies that provide protection against insolvency online. There are N numbers of comparison tool available online, which help you get the best plan and secure your trip. Shop around to get your exact insurer. You may read : The Problems of Travelling to a Foreign Country and its Solutions It is sad that there are no such insurers, who cover insolvency of a travel agent. Their discontinuation of membership of Travel Compensation Fund (TCF) could be a reason. This association provides financial assistance to the traveller who bears a loss when a travel agent collapses. But there are few countries in abroad which continue the trend of providing travel insurance with insolvency. For instance, the Singapore Tourism Board encourages its outbound customers to have travel insurance with insolvency coverage. However, the insolvency coverage may vary policy to policy depending on the terms and conditions posed by the insurer.
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AuthorInsurance and financial manager. Archives
May 2018
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