Whether or not to buy travel insurance has become less of a question than it once was due to bankruptcies of airlines and tour operators, non-refundable air fares, health factors, incidents of terrorism, and natural disasters like earthquakes and hurricanes. Insurance plans may be comprehensive, while others can allow you to buy a specific type of coverage or coverages.
Donít Leave Home Without It but Do Read the Fine Print
Deciding what travel insurance to buy, and for how much, can be a daunting process. Here are some factors to consider:
Overall, consumers should read all the fine print (granted, not always easy) and ask a lot of questions. The more you know up front, the fewer hassles you will encounter if you need to file a claim.
- Primary elements of travel insurance include trip cancellation, trip interruption, accidental death or dismemberment, medical/dental coverage, transportation to adequate medical facilities, loss of luggage or personal possessions, and protection against the default or bankruptcy of suppliers. Other insurance options can include personal liability coverage for damages, legal defense, repatriation of remains, bad weather and many other contingencies.
- Shop around as conditions and costs vary. Determine what insurance you already have. Homeowner policies, for example, often include limited coverage for losses away from home. Medical and auto insurance policies may also provide some coverage. Some credit card issuers offer life insurance on flights. Remember that double coverage doesn't bring double protection. Insurers usually have a provision in their policies to prevent duplication of payment for the same coverage and communicate with each other to pinpoint the extent of their individual obligation to you.
- One of the most confusing aspects of travel insurance is the discovery of the specific pre-existing conditions that can void your trip-cancellation coverage. Some insurance companies are more liberal than others on this score and at least one outfit now waives pre-existing conditions. Remember that a basic premise of trip-cancellation, like insurance in general, is to exclude forseeable claims.
- With trip cancellation/interruption, find out precisely who is covered. Must the insured be traveling with you or could coverage include someone at home who becomes ill? Similarly, determine exactly when coverage starts and ends. In the event of medical evacuation, see if the policy means an evacuation only to the nearest medical facility -- or all the way to your home. Does the insurer have a 24-hour hot line to provide emergency travel advice and assistance?
- Excluded from coverage may be individual acts of terrorism and hijacking, as the result of declared or undeclared war, may be under war-risk provisions. Again, there may be variations in interpretation, so check the wording carefully (especially if you're journeying to troubled areas). In this vein, find out if there are any countries where the insurer declines coverage.
- Although travel agents sell travel insurance -- and receive commissions -- they are not insurance agents and they may not understand all the ramifications of a policy, especially when you get to the small print. Best bet is to ask your travel agent to check out any or all questions you have and/or call the insurance company yourself; they have toll-free numbers.
- Increasingly, cruise lines and tour operators offer optional programs covering such items as trip cancellation/interruption and baggage loss. These plans may have nothing to do with an insurance company, but they still offer some protection. Some cruise lines/tour operators, however, offer similar coverage that is underwritten by an insurance company and this would provide a greater degree of security.
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