Implementing business travel insurance is one way to mitigate the impacts – financial or otherwise – of the unexpected and adverse events associated with business travel, providing peace of mind for you and your employees when they travel.
Business or corporate travel insurance can help ease the stress of dealing with sudden travel changes and protect all parties from occurring loss.
These unexpected changes go far beyond flight cancellations or baggage delays. Without corporate travel insurance, any non-refundable fees that you’ve already paid will be lost regardless of the cause of the changes, for example an existing medical condition for which a doctor advises that you cancel your trip. This is particularly important for small businesses.
What is business travel insurance?
Business travellers are well acquainted with all the elements of a business trip that can go wrong, such as flight cancellations, lost luggage and weather-related delays. Be it domestic or international travel, it’s essential for travellers to be prepared for some level of inconvenience during their travels. For business travellers in particular, travel delay can result in much more than just inconvenience. There can be business ramifications such as missed sales opportunities or disappointed customers.
Business travel insurance coverage can provide for emergency medical expenses, work and job loss related trip cancellations and interruptions, travel assistance services, corporate equipment damage and loss, baggage delays and many more. Corporate insurance travel policies typically include provisions for both medical care and property loss or damage.
Should travel disruptions incur financial burdens or schedule changes, most business travellers have the peace of mind that their employers will cover those costs and take care of any additional related needs. As such, corporate travellers' insurance needs may differ from those of the average traveller's comprehensive policy.
How does business travel insurance work?
Like leisure travel insurance, business travel insurance can be purchased on a one-off basis, to cover a single trip, or on a ‘blanket’ basis, meaning you are insured for all trips made by your company’s employees throughout the year.
Blanket insurance is the more cost-effective option for companies who send many employees on business trips. With a blanket insurance policy, your company pays a monthly or annual premium based on its level of risk.
Types of business travel insurance
Typically, there are two categories of commercial travel insurance under which policies are made. These categories are domestic and international travel.
These are further categorised into single trip insurance, only covering a journey from the start date to the end date of a single-trip, and multi-trip insurance, covering all trips made within a fixed time frame like six months, one year, etc., for businesses.
Business travel insurance should cover the following:
- Medical costs
- Property loss or damage
- Travel interruptions, cancellations and delays
- Luggage
- Identity theft
- Life insurance
- Security
- Personal gadgets
Why does your company need business travel insurance?
Every traveller has encountered cancellations and baggage delays at some point. A single trip can be compromised if there are multiple layovers with international travel. However, there are many other risks that can impact business travel and consequently negatively impact business success. These could include:
- Flight delays and last-minute cancellations causing travellers to miss important meetings.
- An injury or other medical condition meaning travellers need to cancel or reschedule a planned trip.
- Severe weather may disrupt travel routes, preventing travellers from arriving at their destination on time.
- Serious illness during travel could involve emergency medical evacuation or even a last-minute change to a traveller’s trip to get them out of the country and back home.
- Checked luggage containing important business equipment, presentation materials or personal items like credit cards doesn’t arrive on time or gets stolen.
Given the dynamic, unpredictable nature of the travel industry, it’s not a question of if it’s going to happen, but when it will happen. Business travel insurance can reimburse you for non-refundable money spent on air travel or hotels. It can also reimburse the costs of emergency medical treatments when your people are on the road. The key is to make sure you have the right kind of corporate travel insurance plan.
What should your corporate travel insurance cover?
Your company’s specific business travel insurance policy must cover all the uncovered risks your employees are exposed to when they travel. This varies greatly from one company to the next. So, when choosing a business travel insurance policy for your company, seek an insurer that offers flexible, customisable cover packages.
Below is a list of the most common and important topics your company will want to consider including in its business travel insurance policy. These are typically areas that your company’s existing employer liability and health insurance policies will not already fully cover.
1. Supplemental foreign medical expenses - With a business travel insurance policy, you can insure employees against foreign medical costs that your company’s normal insurance will not reimburse. These include higher costs of drugs and healthcare for employees injured on the job in countries like the United States.
2. Designated healthcare provider - Many business travel insurance companies partner with an emergency healthcare provider or network of vetted, local healthcare professionals. In this way, insured employees have easier access to reliable healthcare in case an emergency occurs while they are working abroad. This service provides peace of mind and ensures employees receive adequate medical attention when they need it most.
3. Evacuation - If an employee must suddenly return home because of a medical emergency, natural disaster or other unforeseen event, the travel costs can be considerable. This is especially true if the employee must be evacuated from a remote location. Business travel insurance can cover costs of special travel arrangements in such cases.
4. Repatriation of remains - In the sad event that an employee dies while working abroad, returning their remains home can result in substantial out-of-pocket costs for which your company may be liable. As with emergency evacuations, your company’s business insurance policy can absorb these unexpected expenses.
5. Luggage and company property - Theft or loss of luggage, including expensive company property like laptops, business plans or prototypes, can result in major setbacks for your company. Be sure your business travel insurer will reimburse you for this.
6. Travel delay expenses - If an employee’s travel is unexpectedly delayed, your company’s business travel insurance can pay for the costs of their additional accommodation, meals and alternative transportation costs.
7. Supplemental rental vehicle insurance - If your employee has an accident in a rental vehicle, typical rental insurance will only cover up to a certain amount of the damages. Your company’s business travel insurance can cover any extra costs. This can be extremely beneficial if your company regularly hires vehicles to transport its employees and materials abroad.
8. Liability - If an employee causes damage or injury while on the job (for example, while operating machinery or a vehicle), your company can be held liable. If this damage takes place while the employee is abroad, your company’s regular liability insurance may not fully cover the costs. Business travel insurance can include additional cover for any such gaps in your company’s regular liability protection.
9. Cancellation - Alternative transport: If a trip must be cancelled due to illness, an accident or other unexpected circumstances, your company could be seriously out of pocket for unused tickets and accommodations. As with leisure travel insurance for individuals, business travel insurance reimburses your company in such events. If an employee’s flight or other transportation is cancelled while he or she is on the way to a work-related event, your business travel insurance company can provide alternative transportation.
10. Alternative staffing - If a travelling employee must be replaced in the middle of a project, due, for example, to a workplace injury, your company’s business travel insurance can cover the costs of dispatching a replacement employee.
11. Resumption of assignment expenses - If an employee has returned home due to a medical emergency, your company’s business insurance can cover the added costs of returning that employee to work abroad once he or she has recovered.
12. Foreign workers’ compensation - An employer’s legal obligations towards its employees can vary significantly from one country to the next. If an employee is injured while working abroad, employers may be liable for additional costs or subject to legal action that would not apply if the worker were at home. Business travel insurance can shield employers from these additional costs.
13. Care for the business travellers’ family - Business travel insurance can also provide benefits to the insured worker in case they are travelling while their spouse passes away, or a medical emergency occurs in their family.
How to choose your business travel insurance
Those who regularly book business travel understand better than anyone that your company has a duty of care towards all its employees, wherever they may roam.
Duty of care is all about ensuring a safe, healthy work environment, even when your employees are trotting the globe. International business travel provides companies with unprecedented opportunities for growth and success.
However, it also poses unique risks – both to the health and safety of the individual employee, as well as to your company’s financial interests. For example, how might an unexpected injury impact a colleague who is travelling in a foreign country where medical facilities may be less accessible than at home?
Or, how an unexpected travel delay can result in lost revenue for your company. It’s key to consider every possible adverse outcome based on past experiences from business travellers in your company. Therefore, it’s important to investigate through surveys and to document the past experiences of travellers.
Check these 3 factors when selecting your corporate travel insurance:
- What is included
- Quotes and rates
- Coverage
Keep these factors in mind when selecting your commercial travel insurance:
- Frequency of travel
- Destination
- Trip length
- Traveller age
- Traveller health conditions
- Cover size
- Add-on features
- Service and claims history
Insurance for business travel is of such importance for businesses, especially travellers insurance for small businesses. Having these risks covered ensures an additional layer of protection against financial loss which in turn can help avoid serious business impact during travel.
