For Indian students bound overseas, April and May are the two crucial months. This is when their preparations to fly out of the country to pursue their studies in August or September take definitive shape.

While parents and students would have had all the important boxes ticked – destination country, stream, course, university, finances and so on – you will have to make a critical decision at the time of completing formalities: buying insurance.

Most universities make it mandatory for students to have adequate health insurance cover, but even in cases where they don’t, it is in your interest to be insured. And, you will have to choose between buying a policy from the university-partnered local insurance company or a specialised overseas student travel insurance plan from an Indian insurer before you fly out.

What university-recommended plans offer

Education consultants say it is better to go for a medical insurance policy provided by the local insurance companies your university has tied up with. “The authorities are aware of which hospital to take you to in case you fall ill or have an accident. The claim will be settled on a cashless basis, with no questions asked. There will be no delays or uncertainties regarding whether or not the ailment is covered under the policy or if cashless facility is available,” says Rohan Ganeriwala, Co-founder and Director, Collegify, an education counselling firm.

While university-supported insurance policies may be 10-15 percent more expensive compared to Indian student policies, depending on the course and arrangement with local insurers, Ganeriwala says they offer peace of mind, which is their primary purpose.

“The deductibles – the amount you have to meet out of your pockets before the insurer’s responsibility is triggered – could be higher in the case of Indian insurance policies if you get treated at non-network hospitals or clinics. This will not be the case with local insurer-provided covers. We have never had claim-related complaints from such students,” he adds.

Indian student travel policies as add-ons?

Indian insurance companies, on the other hand, say that despite offering comprehensive coverage under their student travel policies, universities abroad often insist on students buying insurance from their partner insurers.

“The biggest challenge that we have faced over the years is educating parents about the importance of student travel covers. Universities overseas make it mandatory to buy insurance from their partner companies as they have their own interests in mind. They keep changing requirements every year so that any of the home country insurers are not able to easily meet them. However, post-COVID, many parents are realising the importance of having a parallel insurance (in the form of student travel policy purchased in India) in place,” says Jaydeep Deorukhar, Vice-President and National Sales Head, Tata-AIG General Insurance.

It is one of the Indian non-life insurance companies which, over the last few months, have revamped their plans in response to demands from universities, particularly in the United States, such as higher sums insured and medical evacuation coverage.

Indian insurers like Tata-AIG and Royal Sundaram have now decided to offer coverage of up to $1 million, up from maximum sum insured of $7.5 lakh earlier.  Insurance officials say it is not possible to price risks involved in offering an unlimited sum insured, which some universities had demanded.

Due to universities’ stance, the approach on promoting these covers has also changed. “We tell them that they can buy overseas student travel policy as a parallel cover that will complement the university insurance. They are, after all, spending lakhs as education expenses. Paying Rs 20,000 more for a student travel policy won’t pinch, given the additional benefits it offers,” says Deorukhar.

Manas Kapoor, Business Head, Travel Insurance, Policybazaar.com, says that several parents often do not opt for overseas student travel plans from Indian insurers. This is because they would have already shelled out huge sums for buying university-recommended insurance covers and secondly, the education consultants’ community does not promote overseas travel plans. “Education counsellors often recommended covers provided by the universities. Also, for a student travelling to study in, say the United Kingdom, NHS registration is mandatory. They have to pay Rs 1-1.2 lakh to enrol into the scheme for a year. So, they are reluctant to spend more on student travel policies,” he says.

Is additional cover worth your while?

Insurers and intermediaries say that an overseas student travel policy offers several covers that a university insurance will not. “For instance, study interruption, trip cancellations, flight delays, injuries sustained while participating in sports competitions, coverage for bail bond (if it is a bailable offence), loss of passport, baggage or laptop while travelling outside the state where the university is located or from India to the destination country and so on,” says Deorukhar.

According to Kapoor, university insurance covers come with restrictions. “These are pure medical policies. Also, they will offer protection only so long as the student stays within the campus or the state. If a student were to go on a vacation and meet with an accident, the university insurance will not come into play, a but a student travel policy will. An overseas student travel policy will also make good the loss of tuition fee if a student happens to miss a semester due to hospitalisation,” he says. Likewise, under the compassionate visit benefit, if a student were to fall sick and parents have to visit, the cost of parents’ travel will be reimbursed by student travel policies.

Ganeriwala, however, believes that the primary purpose of such a policy is to take care of medical expenses, and on this count, university-supported covers are superior to overseas student insurance plans.

Kapoor recommends buying student travel policies as add-ons even if your university refuses to waive off the requirement of buying the insurance cover through its local insurance partners. “The cost will be less than 1 percent of your tuition fee. For instance, a student travelling to the US can buy a $100,000 cover for an annual premium of around Rs 20,000,” he says.

Do note that student travel policies come with certain exclusions, much like leisure or business travel covers. “For instance, claims related to, say, accidents when the insured was under the influence of alcohol, war-like situations, planned treatment and so on will not be covered,” says Kapoor.

Put simply, you can consider an overseas student travel insurance policy if you can afford the cost of an additional plan that complements your mandatory university cover. In any case, you ought to buy a travel insurance policy for covering risks during your journey from India to your destination country. Deorukhar recommends a cover of $500,000-750,000.