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Insurance a must read for studying overseas

LiveMint logoLiveMint 10-07-2017 Shaikh Zoaib Saleem

Indian students are increasingly opting to study abroad. According to EducationUSA, the number of Indian students in the US rose 24.9% in 2015-16 compared to 2014-15. EducationUSA is a US Department of State network of international students advising centres in over 170 countries.

While these numbers are only for the US , they indicate that the number of Indian students going abroad is growing rapidly. “Over 50% of the students from India go to the US. The other major destinations are Germany, UK, Australia and New Zealand,” said Puneet Sahni, head, product development at SBI General Insurance. And all these students have to take medical insurance because all the major universities mandate it. For this, students can either get health insurance or a travel policy that provides medical cover in foreign countries. We take a look at some basics of travel insurance policies specifically aimed at students studying abroad. 

Mukesh Kumar, executive director, HDFC Ergo General Insurance Co. Ltd said that students’ overseas travel insurance plans provide coverage throughout the tenure of the education programme of the student. “Apart from covering accidents and medical treatment, the policy also covers loss of baggage, loss of passport and documents,” he added. 

Sahni said compared to a regular travel insurance policy, those directed at students are more like mediclaim covers as they are customised to suit students’ requirements for longer stays abroad. In fact, today there are policies that provide cover for up to 3 years at a go.  

Travel policies, especially those aimed at students, are more than medical covers. “Students must opt for a policy that goes beyond health related coverage. While certain universities may not prescribe this requirement, it is advisable to opt for a policy that covers other contingencies such as sponsor protection, coverage for study interruption and bail bond,” said Anuj Gulati, chief executive officer, Religare Heath Insurance Co. Ltd. 

A regular travel policy covers only one trip and provides cover for, among others, loss of baggage, health emergencies, trip cancellation, delay in flight and loss of passport. However, the covers for students travelling abroad are more comprehensive. Students should ensure that their insurance provides covers for “sponsor protection—to reimburse tuition fee in case of death of sponsor—and bail bond; for false arrest or wrongful detention” in addition to what regular overseas insurance policies provide, said Anand Roy, executive director and chief marketing , Star Health Insurance Co. Ltd. 

“Student travel insurance policies these days also cover risks like suicide, treatment of mental or nervous disorders, and treatment for alcohol and drug dependency. Some policies also cover extended treatment in India,” said Mahavir Chopra, director-health, life and strategic initiatives, Coverfox.com. On payment of extra premium, students can opt for additional covers like psychological coverage, treatment for expectant mothers, childcare benefit and cost of screening and examinations, Kumar said. 

Most importantly, the travel insurance policy for students has to be in line with the guidelines of their particular university. “This is important because a student stands a chance to lose the benefit of insurance waiver offered to them by the university in case their policy’s coverage does not meet with the respective university’s guidelines,” Gulati said. 

Check that the policy covers out-patient expenses outside the campus too, as some policies limit coverage to in-campus clinics only. Also, check if there are any co-payments or sub-limits applicable on the policy, Gulati added. 

Check if your university allows you to buy a policy from outside. “Some universities tie up with local insurers and the students are then mandated to buy those policies,” Sahni said. 

The cost of policies bought in India is much cheaper compared to insurance policies bought abroad.

However, “Not understanding the requirements laid down by the educational institute before deciding on policy is one of the common mistake made by students. Apart from this, many students buy policies from the university as well as from a local insurance company, which turn out to be way expensive than the Indian policies with equal or better benefits,” Chopra said. 

For instance, Sahni said, a policy with a medical cover upwards of $250,000 in the US could cost you around $700-750 a year, with sub-limits like out-patient, dental and sports-related treatments, while you can buy a similar student travel cover for Rs15,000-20,000 in India. “There have been product improvements that actually aim at matching the coverage that universities demand. More or less, those are covered but there are certain aspects like a very high OPD limit or a very high dental cover limit, which the Indian policies may not be able to cover as these are very expensive services there,” he said.

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