whizzing pilfer: Tour Companies Promote Travel Insurance ? TalkVietnam

Although travel insurance costs are not high ? they only account for a small percentage of total tour costs (about VND1,500/day/person for domestic tourists and US$1.5/day/person for foreign tourists), it is necessary for visitors to have travel insurance as they have to face with potential risks during their visits. Therefore, visitors and travel agents have paid more attention to travel insurance in addition to tour destinations and value for money.

A survey conducted by the Saigontourist Company shows that travel insurance is among top five issues for tourists. Travelers are especially interested in seeking detail information on the level, scope and benefits of insurance coverage, administrative procedures for payments are very important for older tourists during their domestic and foreign tours. To enhance competitiveness in the domestic market and attract more visitors, travel agents should pay more attention to travel insurance services. Carlos Vanegas, the general director of US-based Liberty Insurance Company said, travel insurance is considered the second key factor for travelers who usually have to go abroad. Therefore, travel insurance should be included in every trip.

Although it is necessary to have travel insurance for every trip, few travel agents realize its importance. Saigontourist head of marketing Doan Thi Thanh Tra, said that less attention has been paid to the travel insurance market in Vietnam, pointing to its lack of professionalism. Phung Tan Loc, the general secretary of the Association of Vietnam Insurers, said Vietnam attracted more than 4.5 million foreign visitors and 15 million domestic visitors while over 3 million Vietnamese people went abroad in 2010. However, the percentage taking travel insurance was limited. 95 percent of domestic and foreign visitors who traveled through tours of travel agents didn?t have travel insurance.

In Vietnam, Saigontourist, Vietravel, Ben Thanh Tour and Fiditour have offered travel insurance services to raise the quality of their tours and attract more visitors. Since 2004, Saigontourist has been offering free travel insurance coverage for its clients. Visitors traveling abroad will receive a maximum disbursement amount of VND630 million/person/case. Visitors to European countries can receive the maximum amount of VND2.1 billion (equivalent to US$30,000-100,000). Meanwhile, insurance levels for domestic tours amount to VND60 million. Saigontourist has been the first travel agent in Vietnam to apply insurance in case that terrorism, natural disaster and pandemics. Tourists using Saigontourist?s outbound tours feel totally secure with open insurance cover when tours are extended or interrupted and any potential health treatment costs are incurred. The cover is extended to include any health treatment duration in Vietnam of up to 31 days. Travel insurance packages for outbound tours have been extended by two more days and include cover for travel to and from the airport.

Together with Saigontourist, Vietravel has been one of the first travel agents which offer travel insurance free of charge. Vietnamese people and foreign visitors using inbound tours can receive a maximum insurance payout of VND100 million/person and US$10,000 respectively. The figure for visitors using Vietravel?s outbound tours is US$10,000. Clients have been impressed with tour prices remaining static, while increasing in quality.

Leading global market research company Research and Markets said that Vietnam?s insurance market is one of the fastest developing in the world. Vietnam offers many opportunities for foreign insurers. It is estimated that the growth rate of Vietnam?s insurance market will reach 22 percent during 2011-2014. The insurance market in general and travel insurance in particular will have great potential for development. The effective development of this market will contribute to developing the tourism sector in a sustainable way.

The Association of Vietnam Insurers said that it is necessary to disseminate the important role of travel insurance for visitors. Currently, the Vietnamese embassies in foreign countries should require foreign visitors to purchase travel insurance when they grant visa to visitors. This is what foreign embassies are doing now.

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