Buying travel insurance from airlines may not get you the cover you need, according to a new report.

SINGAPORE, Jan. 25, 2018 /PRNewswire/ -- Travel insurance bought from airlines may invariably cost you more and give you less cover than a direct insurer, says Simon Birch, CEO of Budget Direct Insurance, who is keen to highlight an independent study in a bid to safeguard consumers.

Budget Direct Insurance CEO warns that travel insurance from airlines may not give you the coverage you need.
Budget Direct Insurance CEO warns that travel insurance from airlines may not give you the coverage you need.

His warning comes as more airlines, including Singapore Airlines, introduce auto-inclusion of travel insurance, forcing customers to 'opt out' if they don't want to buy it along with their air ticket.

Statistics, compiled by consumer research firm ValuePenguin, give a run-down of travel insurance costs and sums insured from local airlines versus the average cost and cover from direct to consumer insurance companies.

The chart below compiled by ValuePenguin shows the difference in the type of coverage offered by airlines in Singapore, based on research conducted by them.


Singapore Airlines

SilkAir

TigerAir

JetStar Asia
Airways

Average of
Insurance
Companies

Personal
Accident &

Death

S$200,000

S$100,000

S$25,000

S$20,000

$308,501

Medical

S$200,000

S$500,000

S$10,000

S$20,000

S$563,704

Evacuation &
Repatriation

S$300,000

S$300,000

S$25,000

S$50,000

S$987,931

Trip
Inconvenience

S$5,000

S$1,000

S$1,500

Original Flight
Cost

$S$16,135

Trip Cancellation

S$5,000

S$5,000

Original
Flight Cost

Original Flight
Cost

S$10,685

Trip Delays

S$1,000

S$1,000

S$450

S$1,040

S$1,132

Baggage
Loss/Damage

S$3,000

S$3,000

S$1,500

S$1,000

S$5,449

Baggage Delay

S$1,000

S$1,000

None

None

S$1,072

Cost*

S$55

S$45

S$18.99

$77.95

S$48

*Cost shown assumes a one-week trip within Asia. The majority of costs are maximum limits.

Source ValuePenguin https://www.valuepenguin.sg/travel-insurance-airline-vs-insurance-companies-which-better 

Commenting on the statistics, Simon Birch of Budget Direct Insurance, said: "There are two issues here. Firstly, these figures bear out what we have always known. Travel insurance bought from airlines is often more expensive and generally does not provide you with the same amount of cover you would get from a direct insurance company. In fact, sometimes you're not even getting the basic cover such as baggage delay.

"Secondly, as more airlines are introducing auto-inclusion customers need to be careful they're not opting into something they don't need or don't want or insurance that doesn't provide them with the full coverage they thought they had. These are important issue that needs to be raised to safeguard the consumer."

The ValuePenguin research shows that insurance companies tend to offer higher maximum coverage amounts for lower prices than those offered by airlines. This is because when the insurance is directly offered by insurance companies, they are able to cut costs by bypassing the middleman, as is the case with direct insurers like Budget Direct Insurance.

Airlines, however, tend to receive a portion of the price of insurance as a commission, thereby inflating the price a consumer ends up paying.

Birch added: "Think twice before buying travel insurance from airlines. You may not be getting value-for-money coverage from them. Check them out carefully to make sure the coverage suits your needs before deciding to buy the insurance. And make sure you are not being automatically opted in to buying travel insurance."

About Budget Direct Insurance

Budget Direct Insurance is the trading name of Auto & General Insurance (Singapore) Pte. Limited, which is licensed by the Monetary Authority of Singapore, and bound by the regulations and requirements for insurers.

Budget Direct Insurance was built as a digital start-up here in Singapore, and it is part of BHL Holdings Limited ("BHL Group"), a privately owned, global group of companies whose principal businesses are engaged in insurance underwriting, direct insurance distribution, brokering and related services, online comparison and property development.

The BHL Group provides insurance solutions to millions of policyholders across several countries. The BHL Group includes one of the largest direct personal lines insurers in South Africa, one of the largest personal lines intermediaries in the United Kingdom and the Budget Direct brand in Australia.

Photo - https://photos.prnasia.com/prnh/20180124/2039947-1

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