Recent incidents have put the spotlight on insurance against terrorism-related incidents. “Recognise the importance of travel insurance, even when you are going to countries where it is not mandatory,” says Nikhil Apte, Chief Product Officer, Product Factory (Health Insurance), Royal Sundaram Alliance Insurance. “Travel insurance provides you financial cover and peace of mind if you get caught in volatile situations,” says Naval Goel, CEO and Founder, PolicyX.com, an insurance aggregation portal. Insurers distinguish between war, riots and terrorism. The latter is defined as an act of violence that causes loss of life and property where perpetrators belong to groups that seek to weaken control of governments.
When you seek insurance against terror strikes, you need to read the fine print to understand the scope of coverage and the items the company will not pay for.
“All risks like trip cancellation, loss of passport, medical expenses, repatriation of remains etc are covered as part of the regular travel policy even if they result from terrorism,” says Sanjay Datta, Chief, Underwriting and Claims, ICICI Lombard General Insurance. Your accommodation expenses will also be reimbursed if you have to extend your stay due to an emergency. Depending on the variant chosen, the company will also pay for your journey back home.
However, you need to go through the policy documents in detail before signing up as some companies may not pay for risks emanating from terrorism. Besides, even in policies that provide insurance against terror, insurers will not admit claims if policyholders visit destinations that are known to be facing such risks or knowingly violate safety regulations. You also need to figure out whether the coverage applies only to a city, or extends to the country as a whole.
Terrorism-related medical emergencies fall under the ambit of health insurance coverage. “Hospitalisation expenses of victims of terrorist attacks are covered. The insured would also be covered for pre and post-hospitalisation and ambulance expenses as well as other expenses as per the policy coverage,” says Sasikumar Adidamu, Chief Technical Officer, Non-Motor, Bajaj Allianz General Insurance. Several higher-end health covers today cover medical emergencies across the world, and not just India.
Personal accident insurance
Such covers compensate the policyholders for disabilities suffered due to accident or the nominees in case of the former’s death. “Domestic personal accident policies will cover death due to accidents, including terror attacks,” says Apte. However, medical expenses linked to biological, chemical or nuclear terror attacks may not be covered.
While some home insurance policies like New India’s product come with an in-built terror cover, several others offer it as an addon cover requiring a minimum extra premium of `80-100. This terror insurance component covers damage directly caused by attackers and loss incurred during counterterror action. “Home insurance does not cover for loss arising out of burglary, housebreaking, looting or theft that occur after an act of terrorism,” says Adidamu.
The policyholder’s dependents will be entitled to life insurance proceeds upon his or her death in a terror attack.
The Time of India