Before the events of September 11, 2001, most travelers had given little or no thought to travel insurance. After these events, we are all becoming more conscious in the travel industry about making our clients understand the value of purchasing travel insurance.
When you book a trip, you have the option of buying travel insurance offered by the cruise line or tour operator, or you could purchase third party travel insurance which your travel agent can purchase for you through an insurance company. In many cases, third party insurance is the best option, as it covers you for many occurrences that the insurance purchased as part of a package does not.
A vacation is an investment in your mental health and finances, and as such you should protect that investment. Travel insurance is a means to accomplish this. Discuss your options thoroughly with your travel agent.
Here are a few questions you should ask your travel professional regarding insurance.
- What does travel insurance cover?
- Is there protection against financial default?
- How much does it cost?
- Is there a deductible?
- Is this primary or secondary insurance?
- Does it cover pre-existing conditions?
- May I see a copy of the policy?
1. What does travel insurance cover? (top)
Most policies cover the following:
Trip Cancellation/Interruption: Most policies require clients to have a legitimate reason for canceling a trip. Some operators offer “cancellation waivers” that allows you to cancel for any reason, but it only covers “cancellation”, and is not insurance. Interruption covers your need to return home during the trip for covered reasons (usually the death or severe illness of one of the travelers, or a close family member at home). Trip interruption covers you if you are stranded due to weather, terror attacks or other unforeseen events where you need to book rooms, car rentals, etc., until you are able to return home.
Medical Expense Protection and Emergency Medical Transportation: Many personal health policies do not provide coverage outside of the United States. This includes Medicare, with the exception of some circumstances in Canada and Mexico. This also covers transportation ordered by a doctor to the nearest adequate medical facility. This is crucial if you are on a cruise ship, as shipboard helicopter transport may be necessary in case of severe illness or accident.
Lost, stolen, or damaged luggage or travel documents: For U.S. travel, the airlines cover $2500 per bag. International travel coverage is $9.07 per pound, or about $650 for a 70 pound bag. This figure has remained unchanged since 1929.
Trip Delay: Covers reasonable hotel and meal reimbursement if your trip (usually your flight) is delayed.
Baggage Delay: Coverage for personal items that you need to purchase if your luggage is delayed more than 24 hours.
Accidental Death and Dismemberment: Some policies cover this occurrence, while others do not.
2. Is there protection against financial default? (top)
Cruise lines, tour operators and airlines cannot insure themselves for bankruptcy or default, so their policies never cover this. Third party insurance usually requires you to purchase the insurance within 7-14 days after the initial deposit, and sometimes has a waiting period.
Prior to September 11, travel suppliers defaulting was a fairly rare occurrence, however, more suppliers have declared bankruptcy due to the terror attack and its aftermath, so this is more important than ever. It is advisable to purchase a policy that offers this.
3. How much does it cost? (top)
Most tour companies and cruise lines offer a flat rate for their coverage. Premiums for the third party insurers are usually based on the cost of the trip and your age at the time of travel. In many cases, third party insurance will be the same or less as the premium offered by the supplier and it offers more coverage.
4. Is there a deductible? (top)
Most policies do not have a deductible. Sometimes there is a partial deductible for the medical coverage portion.
5. Is this primary or secondary insurance? (top)
Most supplier insurance is secondary (meaning you must collect from your own health or homeowner’s policy first and then they will pay the balance). Most of third party insurers offer primary insurance. You keep all receipts for expenses covered under the policy and then file a claim with the insurance company. It is usually a very easy process.
6. Does it cover pre-existing conditions? (top)
Most of the supplier policies do not. The third party insurers do, but usually require the purchase of the policy in a specified timeframe after deposit for coverage to be effective.
7. May I see a copy of the policy? (top)
Your travel agent will recommend the insurance that is most suitable to your situation. If you have additional concerns, your agent should have a copy of the policy for you to peruse.
Website by Digital Picnic.
