Why Do I Need Travel Insurance?
I recently saw a post on Facebook where someone asked about trip insurance. Some of the answers I saw were very good. Others were a bit, well, concerning.
We have all seen the stories where travelers have missed connections, lost luggage for weeks, and experienced disruptions due to natural events like the Maui fire. And during the pandemic, many of us experienced that our booked cruises, tours, and custom trips were outright canceled.
Situations like these can leave us worried about the impact on our travel. You may have a sizeable financial stake in this trip.
And then, there is the issue of medical coverage. Did you know many health insurance programs will not cover you in a foreign country? Basic Medicare insurance will not cover your expenses while traveling internationally. If you have to be medically evacuated, the expense can be huge.
So, what I want to cover in this post are some of the ways you can get travel insurance and what you need to consider when getting travel insurance.
Disclaimer:
I am not a licensed insurance agent. Therefore, I cannot interpret specific policy questions for you or advise you on what specific insurance coverage you need. Nothing in this post should be considered a recommendation for specific conditions you have in an insurance policy. This is neither an endorsement of a specific insurer nor a discouragement from another.
When I work with you on planning a trip, I will recommend that you purchase travel insurance. If I send you a policy to consider, I will remind you that I cannot interpret any of the conditions in the policy, but I will make sure you have the appropriate contact information with the insurer to have them answer your questions to the best of their ability.
Where to get Travel Insurance
Insurance Companies
Several insurance companies specialize in Travel Insurance, some of whom sell their policies through Travel Agents, and some work directly with the traveler. Some of these names include AIG, Allianz, AXA, Travel Insured, and Travelex. Just Google “Travel Insurance Comparison,” and you will see a large number of resources to compare the different companies that sell travel Insurance.
As a Travel Agent, I offer several, but not all, insurance companies. I am not including or excluding certain insurers because I consider them “good” or “bad.” It is because these are the ones considered “preferred” through my Consortium. It is purely a volume issue. I can’t offer every single policy because keeping up with all of them would be a full-time job.
Credit Card Companies
Check with your credit card company. You may already have some travel insurance benefits included with your card or have access to travel insurance through the credit card company. And check if you have to purchase the trip through that credit card to be covered.
Your Travel Provider
Often the cruise line, tour operator, or air carrier you use will provide trip insurance in some form. Usually, the insurance provided through the operator is from the same insurance companies that you can buy directly. If that coverage is available when you are booking your trip with me, I will make you aware of it.
Things to Consider When Buying Travel Insurance
Trip Delay, Interruption, and Cancellation
All three of these are separate clauses in the policy. Policies will vary based on the level of coverage for each one and the defined conditions for each one. For example, this past year, I had a case on a river cruise in which I had to leave the cruise early due to a labor strike at the Munich Airport. I had two different insurance policies available to seek reimbursement. One policy would not honor the claim because it specifically did not list labor strikes as a covered condition.
There is typically a daily limit for trip delays or interruptions regarding the amount of compensation available. For trip cancellation, the policy may list a maximum amount. Depending on the policy, it may not necessarily equal the cost of the trip. Also, there will be conditions noted for covered reasons. During the pandemic, there were cases where some unfortunate travelers found out that a pandemic was not a covered reason.
Lost or Delayed Baggage
Check the policy’s coverage for lost, stolen, or delayed baggage. It should provide compensation for essential items you may need in such situations.
Some additional tips concerning luggage. Be sure to note any specific expensive items you have in your checked baggage. Some people will go so far as to take a picture of the contents of their luggage. I would, at minimum, have a list of items (8 shirts, 5 pairs of pants, etc). Now, I also place an airtag in each of my checked luggage. And keep receipts of any replacement you purchase while traveling.
Medical Coverage
Most insurance policies will have provisions for medical expenses while traveling. Be sure to check the level of coverage provided. Medical coverage can also cover medical evacuation. Other conditions that can be provided are expenses for a travel companion while you are hospitalized, or the travel cost of someone to travel to you to care for your dependents.
Policy Exclusions
Be sure to check the items excluded under the policy. These can include risky activities, like paragliding or rock climbing.
Pre-Existing Conditions
Check the policy for any exclusions based on pre-existing medical conditions. Also, be aware that most policies require that the insurance is purchased within a certain amount of time after a deposit is placed on the booking. This amount of time is often between 7 and 21 days. The insurance companies often reserve the right to do a “look-back” from the time of booking to the time the policy is purchased. The claim may be denied if a condition occurs during that time that is being claimed under the insurance policy.
Cancel For Any Reason Clauses
Cancel For Any Reason (CFAR) is a catchall you can add to the policy. As the name indicates, it offers coverage for reasons not specified in the policy. But even here, there may be limitations in the amount of compensation available. Be aware that adding CFAR coverage can significantly increase the cost of the policy.
Policy Cost
The cost of a travel insurance policy is dependent on several factors including, but not limited to:
- The cost of the trip.
- Your state of residence (this can also affect the items covered in the policy).
- The ages of all travelers.
- The trip destination.
- The time the trip is taken.
- The levels of coverage stated.
Conclusion
This is a sensitive subject for several reasons. First, it tends to leave you with a negative overtone on travel. That is definitely not my intent. I will always endorse travel for the enrichment it makes in our lives. Second, buying travel insurance will not prevent unfortunate circumstances. Your luggage may get lost regardless of whether you buy travel insurance. Third, insurance can be complicated, and there can always be conditions not covered.
But what travel insurance can do is lessen the impact of unexpected and unfortunate incidents as you travel. And it can give you peace of mind when traveling.
