Travel Insurance during COVID-19: Which should you get? (VTL)

  • Post author:

With the opening of Singapore’s borders, and the expansion of the Vaccinated Travel Lane scheme to 11 countries, more Singaporeans are looking forward to travel. But comparing to the pre-pandemic era, there are many more considerations to take into account. The largest one being COVID-19 Travel Insurance Coverage. This article will discuss the many options available, and the many things to look out for.

 

Overview of Plans: Table of Policies


The following table details the many plans on offer, from 8 different insurers. Only Travel Insurance policies that are offering plans with COVID-19 coverage are shown below.

An example of a Family of 4 planning a 16-day trip to the United States of America is shown below.

Travel Insurance policies, with COVID-19 coverage.

This comparison table includes each travel insurance policy for 8 different insurance companies. There are significant differences between them, so you should keep a look out for them. If you are really unsure on which travel insurance policy is best during this era of COVID-19 travel, do look for me to discuss on which plan suits you and your family the best.

 

1. Some Travel Insurance policies DO NOT include COVID-19 coverage!


If you are looking for a travel insurance plan during this pandemic, take note of this! Below is an example of a travel insurance plan that does not have COVID-19 coverage.

Some policies do not have COVID-19 coverage.

Meaning if you do get COVID-19 abroad, you will NOT be covered! Be sure to look at each policy in-depth, and read the fine print.

 

2. Overseas Medical Expenses Coverage ≠ COVID-19 Overseas Medical Expenses Coverage


Look closely at these 2 companies’ travel insurance policy. The following image will show that the coverage for non-COVID medical expenses and COVID-related medical expenses are vastly different.

Example of travel insurance policies of 2 companies, and their plans.

Let’s say you subscribe to Plan B in the first example. If you incur Overseas Medical Expenses due to COVID-19, instead of $2,000,000 in coverage, your coverage will only actually be $15,000. Is $15,000 coverage in Overseas Medical Expenses really enough?

In the second example, subscribing to Plan A will not cover you for any COVID-19 related medical expenses. This reinforces the first point where some policies do not include COVID-19 related medical expenses. 

These differences in COVID-related and non-COVID related coverages also apply other aspects such as Emergency Medical Evacuation, Repatriation and Trip Cancellation.

 

3. COVID-19 Medical Expenses Coverage can vary by age


Depending on your age, coverage for COVID-19 related Overseas Medical Expenses can vary from plan to plan. Differences are highlighted in red. In the example below, some policies offer lesser coverage for Children and/or Adults aged >70 then Adults aged <70 (Company A’s plans), while some offer the same coverage, regardless of age. (Company B and C’s plans) Ensure that the policy you choose to purchase suits your needs. 

 

4. Does your policy include Overseas Quarantine Allowance?


If you test positive for COVID-19 prior to your departure for your return flight, chances are you will not be allowed to board the flight back to Singapore. (Highlighted in yellow below) In that case, you will be subject to overseas quarantine, whether it be at a hospital, a government facility, or remaining at your place of residence. For example, in the United States, you are to isolate for at least 10 days.

You will not be allowed to travel back to Singapore for 14 days if you test positive on your pre-departure COVID-19 test.

The cost of quarantine isn’t small. For example, in the USA, one night of accomodation in Los Angeles can cost upwards of $200 per night per room/apartment. Multiply that by 14 days, and that will set you back more than $2,800.

Some travel insurance polices include Quarantine Allowance, while some do not!

Highlighted in yellow is the Quarantine Allowance due to COVID-19. First row shows total coverage, while the second row shows the coverage per day. Note that depending on the cost of accomodation in your chosen country, it may not cover the cost of quarantine completely. $100 per day can help soften the blow to your finances should you be subject to overseas quarantine.

If you subscribe to the third insurer’s plan in this example, you will not have any COVID-19 quarantine allowance should you be subject to quarantine and isolation overseas! Be sure to check if your policy will cushion the financial repurcussions of testing positive for COVID-19 overseas. 

 

5. How many days will your policy cover for Overseas Quarantine?


Most policies offer Automatic Extension of Cover, due to quarantine. Do read the policies in detail! Different companies offer different lengths of automatic extension. For example, this is a snapshot of a policy taken from one of the plans. This policy offers up to 20 days of coverage due to overseas quarantine. Meaning if you have to quarantine >20 days due to COVID-19, you won”t be covered after 20 days.

This policy offers up to 20 days of coverage due to overseas quarantine.

Below is a comparison table of the number of days each policy covers for quarantine length. One good way to check if your policy’s maximum quarantine allowance length is enough, is to check your chosen countries’ health advisories’ COVID-19 quarantine/isolation length.

Comparison of Automatic Extension of Cover (in days)

Different policies offer different additional lengths of quarantine coverage. (See highlight in blue) Do look through each policy to see if it fits your needs.

 

6. Will your policy cover cancellation/postponement/interruption of your trip due to COVID-19 related issues?


Border closures? Sudden VTL cancellation? Ensure that your policy covers these events. The last thing you want is any of these events happening, and not being able to get back your money.

Comparison of Trip Cancellation/Postponement/Interruption coverage due to COVID-19 related issues

Highlighted in green are the trip cancellation/postponement/interruption policy differences. Do study each policy differently, as each policy’s fine print is different. For example, Company C’s Trip Interruption has coverage for $1,000 in additional transport expenses. (Highlighted in purple)

 

7. (For families) Check whether your child is actually a child!


According to the insurer, is your child really a child? In a sense, this depends from insurer to insurer. If your child does not fit the criteria of being a child, use the “group” option while purchasing your insurance plan, not the families option. This is to prevent complications, in case you need to perform a claim. Which in the COVID-19 era, is more common due to the possbility of getting quarantined overseas.

An example of an insurer’s definition of children

Some insurers charge about the same, regardless of whether you select the “group” option (if your child does not fit the definition of a child) or the “family” option. Some insurers charge a lot more, simply because your child is one year too old (e.g 22 years old instead of 21). 

If your child is between the ages of 18-25, depending on the insurer, one might classify them as a child while another might not. Be sure to compare insurance plans according to the insurer’s definition of your children.

Highlighted in blue is an example. Policy costs alone, Company B does not charge you a lot more if you select a “group” plan instead of a “family” plan. Company A’s family plans are more affordable as a family, but if your child is not a child (according to definition), the price is increased by a considerable amount.

Still lost? Do look for me to discuss on which travel insurance plan suits you and your family the best! We need to factor in all the possibilities caused by COVID-19 during this period.

Kenny Loh is a Senior Financial Advisory Manager and REITs Specialist of Singapore’s top Independent Financial Advisor. He helps clients construct diversified portfolios consisting of different asset classes from REITs, Equities, Bonds, ETFs, Unit Trusts, Private Equity, Alternative Investments, Digital Assets and Fixed Maturity Funds to achieve an optimal risk adjusted return. Kenny is also a CERTIFIED FINANCIAL PLANNER, SGX Academy REIT Trainer, Certified IBF Trainer of Associate REIT Investment Advisor (ARIA) and also invited speaker of REITs Symposium and Invest Fair.  You can join my Telegram channel #REITirement – SREIT Singapore REIT Market Update and Retirement related news. https://t.me/REITirement

Continue Reading Travel Insurance during COVID-19: Which should you get? (VTL)

Money and Me: Who benefits from the ESR – ARA LOGOS Logistics Trust merger

  • Post author:

18 October 2021 

Money and Me: Who benefits from the ESR – ARA Logos Logistics Trust merger?

Michelle Martin and Kenny Loh, Senior Consultant, REITs specialist and Independent Financial Advisor discuss ESR and ARA Logos Logistics Trusts’ 1.4 billion Singapore dollar merger and recent trends to grow an investor’s wealth and if property is still the tried and tested route to growing one’s wealth.

  • The ESR REIT and ARA LOGOS Logistics Trust merger
  • Are investing in Physical Properties still a great way to grow your wealth?
  • What are the best sectors to invest for growth?
  • Digital assets (NFTs, Cryptocurrency), China, Technology (AI, 5G, Semiconductor) sector, New Economy REITs

Listen to his previous market outlook interviews here:

Kenny Loh is a Senior Consultant and REITs Specialist of Singapore’s top Independent Financial Advisor. He helps clients construct diversified portfolios consisting of different asset classes from REITs, Equities, Bonds, ETFs, Unit Trusts, Private Equity, Alternative Investments and Fixed Maturity Funds to achieve an optimal risk adjusted return. Kenny is also a CERTIFIED FINANCIAL PLANNER, SGX Academy REIT Trainer, Certified IBF Trainer of Associate REIT Investment Advisor (ARIA) and also invited speaker of REITs Sympsosium and Invest Fair. 
You can join my Telegram channel #REITirement – SREIT Singapore REIT Market Update and Retirement related news. https://t.me/REITirement
Continue Reading Money and Me: Who benefits from the ESR – ARA LOGOS Logistics Trust merger

Sustainable ESG Investing: How are REITs adapting to more sustainable practices? New Green REIT Index Launched

  • Post author:

In recent years, ESG (Environmental, Social and Governance) Investing has come into the forefront. As investors become more aware of the impact business have on climate change, so will their view towards businesses with more sustainable practices.

Several Singaporean corporations have already been recognised for their sustainability efforts, including Capitaland Limited and Cromwell European REIT.

   

MUST Go Green 2021


Manulife US Real Estate Investment Trust (“MUST”) launched its week-long thought leadership initiative on October 5, 2021 to raise understanding of ESG and how mandatory climate-related disclosures for Singapore financial institutions and asset managers from 2022 will impact REITs and investors. The event, titled MUST Go Green 2021, a thought leadership initiative under its Green Dot Series, includes ESG conferences with industry experts, as well as one-on-one meetings with ESG investors. Both conferences today received an eager response and were well-attended by media, analysts as well as institutional and retail investors.

To learn more about ESG Investing, and how MUST is working to achieve net-zero, the recordings to both conferences are now available here: http://manulifeusreit.listedcompany.com/videos.html

With regards to the webinar, Kenny Loh, founder of MyStocksInvesting.com has asked 2 questions on behalf of investors. We thank Ms Jill Smith, CEO of Manulife US REIT for getting back to us on the following questions.

   

1. What is the financial impact of being green? In the short term vs in the long run? (E.g.  Implementation costs vs cost savings) 


  • With the real estate sector contributing to about 40% of carbon emissions, green buildings need to positively impact the natural environment in their design, construction, and  operations.  
  • When it comes to greening a building or portfolio, there is always the challenge of balancing environmental sustainability with economic viability. The bulk of ESG costs lie in the ‘E’ aspect of greening a building (e.g. improving building energy efficiency through  optimising equipment and processes). On average, construction or retrofitting costs for a  LEED-certified building is about 7% to 9% higher than that for a non-LEED building. 
  • Green buildings run more efficiently, thus lowering operating costs. For MUST, our portfolio has registered lower energy and emissions intensities in 2020 compared to the other U.S. REITs, translating to lower costs and sustainable returns. Compared to  conventional non-green buildings, they usually have higher occupancies, fetch a higher  rental and command a higher selling price. A recent survey by JLL also showed that the value of LEED assets (US$/psf) was 21.4% higher vs non-LEED buildings. 
  • Beyond financial returns, green buildings have health benefits for occupants in terms of  better air quality, accessibility, etc. In 2020, MUST’s Michelson property located in Irvine, California achieved the Fitwel Building certification. Fitwel is the world’s leading certification for healthy building performance based on building features that promote  occupants’ health and well-being. 
  • Green buildings also help us attract and retain quality and ESG like-minded tenants such as government and top-tier corporates in their sustainability journey or their race to Net Zero. In major U.S. cities, only about 14% of buildings are certified green. Since the start of  the pandemic, there is an increased demand for such green buildings by tenants. Within our portfolio, we have also received requests from tenants to discuss the ESG  performance of our buildings to ensure they meet with their own sustainability criteria. 
  • On the operation front, having ‘green’ certified buildings could also lower the REIT’s tax expenses. For instance, in New York, LEED-certified buildings are exempted from a portion  of their local property taxes. 
  • Many U.S. states and local regulators are incentivising energy efficient buildings and  penalising carbon emitters, which means that the cost of owning non-green buildings that do not meet regulatory requirements is going to increase down the road. For example, starting in 2024, New York City has mandated large building owners to drastically limit carbon emissions or pay an annual fine of US$268 per metric ton of CO2 over the limit.  
  • Closer to home, Singapore has also set ambitious targets under its Singapore Green Building Masterplan to green 80% of its buildings and pursue ‘best-in-class’ standards for new and existing buildings.  
  • As recently shared in our MUST Go Green event, net inflows into sustainable funds for  2020 has grown +109% YoY to US$347b. By 2023, 80% of investors intend to incorporate  ESG into their investment strategy. 
  • The cost of ignoring or paying lip service to ESG is high. Not only will we miss this new wave of ESG investors, we will also end up with stranded assets that deplete property values and returns for investors, causing brand erosion.
   

2. Given the lack of one consistent ESG rating used across REITs, what will be the outlook and approach for Singapore?


  • A recent Business Times article highlighted that issuers in Singapore grapple with trying to reconcile various ESG reporting standards as well as transparency issues within rating methodologies, among other challenges, within the resource-limited environment where they operate.  
  • ESG-related information that can negatively impact the financial performance of an organisation and its stakeholders are considered material and thus, should be disclosed. We think that this is precisely why the Monetary Authority of Singapore has mandated such reporting according to the Taskforce on Climate-related Financial Disclosures (TCFD)  framework for all financial institutions and asset managers (including REITs) with effect  from 2022.  
  • A common framework will allow for reliable and comparable climate-related disclosures,  leading to better pricing of climate-related risks and more effective risk management and capital allocation towards financing green activities.  
  • A prescribed recommended framework to guide all sustainability reporting will help to streamline the current confusion about ESG ratings and rankings. This will also allow for more comparability of sustainability performance among peers. 
  • Come 2022, MUST will incorporate further disclosures on its climate-related strategy,  targets and performance, in alignment with the TCFD framework. We will also be participating in TCFD-aligned ratings such as CDP and adopting preferred standards such as SASB (Sustainability Accounting Standards Board) which is commonly used in countries  such as the U.S., Australia, Japan and South Korea.
  • Good ratings on notable global sustainability benchmarks will align our sustainability performance to global best practice, and through ongoing gap analyses, we will continue to identify potential risks and opportunities in our pursuit of ESG excellence.
   

New REIT index: iEdge-UOB APAC Yield Focus Green REIT Index


On October 15, 2021, Singapore Exchange and UOB Asset Management launched the  iEdge-UOB APAC Yield Focus Green REIT Index. Formerly known as the Global Real Estate Sustainability Benchmark (GRESB, this REIT index is weighted based on environmental performance, based on a tilting methodology. Click on the image below to view the factsheet of this new REIT Index.

Kenny Loh is a Senior Financial Advisory Manager and REITs Specialist of Singapore’s top Independent Financial Advisor. He helps clients construct diversified portfolios consisting of different asset classes from REITs, Equities, Bonds, ETFs, Unit Trusts, Private Equity, Alternative Investments, Digital Assets and Fixed Maturity Funds to achieve an optimal risk adjusted return. Kenny is also a CERTIFIED FINANCIAL PLANNER, SGX Academy REIT Trainer, Certified IBF Trainer of Associate REIT Investment Advisor (ARIA) and also invited speaker of REITs Symposium and Invest Fair.  You can join my Telegram channel #REITirement – SREIT Singapore REIT Market Update and Retirement related news. https://t.me/REITirement

Continue Reading Sustainable ESG Investing: How are REITs adapting to more sustainable practices? New Green REIT Index Launched