What You Need to Know About Travel Insurance
Travel insurance (also known as trip insurance) is an important consideration when preparing for a vacation. Many travelers base their opinions on the need for travel insurance on mistaken information. To help you decide whether travel insurance is for you, read the following article.
Be Prepared
Few people anticipate unexpected illness or tragedy when planning a vacation. We feel that it is prudent to consider the possibility that health problems or accidental injury might happen to you or a member of your party during your vacation. Trip insurance is designed to protect you when the unexpected strikes.
As a rule, travel insurance makes more sense the further you travel from home or if the investment in your planned vacation represents a substantial expense. Once you depart, the advantage of having travel insurance increases significantly, since the insurance that you have at home (automobile, property, and medical) may not cover you in other countries.
The “whys” of trip insurance
First, consider what happens to your prepaid trip expenses if you should become ill and unable to depart on schedule. If your travel arrangements include airline tickets, cruise tickets, or tour and hotel reservations with nonrefundable fees or penalties, an unexpected cancellation can cost you thousands of dollars. In this case, insurance covering trip cancellation would be a wise investment.
Next, estimate the financial consequences should you, or anyone in your party, be involved in an accident, or take ill during your travels. In most cases, your present medical insurance either will not cover treatment for illness outside of the U.S., or will pay only a reduced portion of the expense. In any case, it is unlikely that your care provider abroad will release a patient from hospitalization without full payment of the expense.
Consider that you may fall ill in locations where there are no medical facilities, or where existing facilities are inadequate to treat your condition. It is possible that you could require medical evacuation to a place where proper treatment is available, perhaps, all the way back to the U.S. Most standard medical insurance (e.g. Blue Cross) does not provide for medical evacuation when you are outside of the U.S. A medical evacuation to the U.S. from Europe can cost in excess of $50,000.
If you are concerned about any of the issues raised above, look into purchasing trip insurance that provides for medical coverage including evacuation.
Insurance Benefits Description
If you are interested in purchasing trip insurance, consider a policy that provides the following benefits:
• Trip cancellation/interruption: protects your investment if you need to cancel for valid reasons (check each carrier’s policy for specific coverage).
• Emergency medical/dental coverage (check to see if the policy reimburses you, or pays the provider directly)
• Emergency medical evacuation/transportation
• Baggage loss or delay
• Travel delay
• Missed cruise or tour connection (if applicable)
Issues to Consider When Purchasing Trip Insurance
1. Compare policies and benefits, and then determine the coverage you will need to protect your vacation investment. Various websites compare the policies provided by major carriers and serve as an online agent for purchasing a policy.
2. Make sure that the carrier is reputable by comparing their coverage with coverage provided by other reliable firms. If there is a major discrepancy on cost, it is likely that there is a substantial difference in the coverage provided. Read the fine print. If still, in doubt, call and ask the opinion of a travel agent.
3. In most cases you need to purchase this insurance within a short time of booking your trip (in many cases you must purchase the insurance by or on the date you make reservations or pay fees).
- The amount of time varies by insurance carrier, and you should pay attention to the requirements, or you may find that you have delayed too long to acquire insurance.
4. Examine the protection that the policy offers.
- Primary coverage means that the carrier will pay your bill and not require you to file claims with your other insurance carrier (the ones that you have covering home, health, or automobiles).
- Secondary coverage means that the carrier will not pay until you have filed a claim with your primary carrier, and they have paid the bill, or until the limits of the primary coverage are exhausted.
- Tertiary coverage means that the carrier pays only when primary and secondary coverage has paid the claim, or when the limits on both have been reached.
- You will pay more for trip insurance when the coverage offered is primary. In addition, primary coverage may not be a good value depending on whether or not your existing insurance policies (e.g. health or homeowners.) provide coverage for specific instances of travel related injury or illness.
- Always ask your insurance agent or a representative of your insurance carrier to explain the limitations of your standard insurance coverage.
5. Pay close attention to the types of medical emergencies that are covered by the policy. If situations of specific concern to you are not covered, shop around for another carrier. You will be spending hard-earned cash on insurance, and you should make sure that you are satisfied with the protection it provides.
6. Ask if the carrier has 24-7 (24 hours a day, seven days a week), toll-free, phone assistance and operators who can converse in English. In other words, ensure that the Company will always be available to serve your needs in an emergency.
7. You may not want to purchase travel insurance from the same Company that is managing your tour or cruise. If the Company fails, you could lose the expense of the tour and the cost of the insurance. If you elect to go with another insurance carrier, make sure that the insurance is fully reimbursable, if the tour operator or cruise line goes out of business.
If you have any other concerns, make sure you discuss them with a qualified insurance agent before you purchase the insurance
Finally, if you purchase trip insurance, make sure that you carry a copy of the policy with you on your travels. The trip insurance policy is a very important document, make a copy and carry it in a secure location while you travel. Also, make sure that you have the contact number or numbers that you will need to contact the Service in case of emergency.