The tremendous travel insurance price gap

Photo: Reuters/ScanPix

Comparing various travel insurances, turns out some may cost almost twice the money while the cover of the dearer offer is smaller.

While Ergo is offering family/kid aged 5 one week Egyptian holiday travel insurance for €42, Seesam asks for €80. Thereat, Ergo offers a €100,000 insurance cover regarding health trouble, Seesam just €35,000.

True, to those going to Egypt Seesam does offer travel insurance encompassing the whole world while Ergo has Egypt sharing the region with Russia and the countries of Europe.

«Every firm has its own conditions and pricing policy – whatever they deem riskier i.e. pricier. As a rule, the price gap rather comes from the differing covers – whether the health assistance is broader or other risks are covered that others aren’t willing to assume,» said Ergo communication manager Merilin Pärli.

In two cases out of three, Ergo’s offer was the cheapest while never offering a cover under €100,000 over the web.

«We wish to offer the clients cover that will in reality cover the costs, should something serious happen. As the experience goes, while abroad the treatment bills may balloon really large,» explained Ms Pärli.

«The price difference between €30,000 and €100,000 insurances is small, but in case of damage it is sure good to have the larger sum,» underlined Ms Pärli. Also, unlike other insurers, Ergo is not offering a separate insurance for those travelling to the Nordics. «In our practice, the damages in Nordics are not lower than in other Europe, rather the opposite may be true; therefore, it makes no sense to price it as a separate product,» said Ms Pärli.

According to Seesam travel insurance product manager Jonatan Jõks, the price differences mainly arise from the scope of the cover offered.

«In many aspects, the conditions are similar, but in case of damage small specifics may make for a big difference. For instance, Seesam compensates the costs of technical aid prescribed by doctors; also, no additional cover needs to be purchased to do lots of specific sports,» he noted.

Further asked about such vast price differences, the company’s marketing specialist Liljan Männiste said in Seesam «Egypt goes under the European region» although an insurance buyer was taught at school the land is part of Africa.

IF Kindlustus press rep Rain Porss said the prices are calculated according to damage statistics, and various companies may price certain risks differently.

«Insurance costs more when travelling outside of Europe, and also for the more elderly (starting from 70 years of age); also, insurance gets dearer if people intend to work or play sports,» said Ms Porss.

Also, insurance is more expensive for those going to America as over there medical services cost much more. As opposed to the other two insurers observer, the IF website offers no insurance at all to those over 70 – the elderly will have to show up at the office.

«To do a contract with those over 70, we need more specific information regarding their health, the length of the trip, its destination, and prior damages,» substantiated Mr Porss.

Most often, it is treatment bills that the insurers have to cover for travellers. Of ailments, Mr Porss said stomach trouble and respiratory diseases are the most common. More often, the elderly are having heart problems. «In Asian countries, however, it needs to be kept in mind that over there all kinds of skin damage is much more expensive to treat than here in Estonia,» said Mr Porss.

In the world of today, trip failures happen for all kinds of reasons. «Mostly, trip failures are not due to people falling ill thus forced to cut the trip short; increasingly, it’s the airlines changing their flight plans,» said Ms Pärli.

Therefore, said she, trip failure insurance is important when doing connecting flights or using various means of transport.