Nothing is more confounding to vacationers than when a travel agent poses the question, “Would you like to purchase travel insurance for your trip?” And unfortunately, there’s no right answer to that question. There are times when it’s a waste and other times when it could save someone from disaster. Typically, frugal travelers forgo it just to save money and those that hate surprises opt to purchase it, even when they don’t need it.
Finding The Right Travel Insurance
There’s much confusion regarding travel insurance, especially since many people assume it’s a scam to make extra money from travelers. What do the different insurances cover? What if it’s not needed after all? To answer these questions, we’ve compiled this guide to travel insurance so that you’re armed and ready the next time you plan a trip!
First, let’s discuss the different types of travel insurance.
Most insurance packages include most (or all) of these items, but they will vary. Do your due diligence and review what specifics are covered with your particular insurance package before booking to ensure that you’re fully covered in the areas that you need.
Emergency Medical
Some personal medical insurance plans (Medicare especially) will not cover international medical care, and that’s where medical travel insurance steps in. Travel medical insurance covers your medical expenses no matter where you are in the world. Some supplemental plans even cover the deductible portion of your expenses. If you’re traveling within your country and have decent medical coverage, vacation medical plans are often not needed.
Evacuation:
In the event of an extreme emergency, evacuation insurance covers the cost of your transportation to an appropriate medically equipped facility. Very few insurance carriers cover this, so it’s not a bad add-on when purchased in a bundle with other travel insurance. But, keep in mind that the likelihood of this happening would be small with a healthy traveler.
Cancellation:
This insurance is possibly the most useful of all. It covers you should your trip be canceled due to unforeseen circumstances such as: illness, natural disaster or company bankruptcy. If a trip is mostly prepaid like a cruise or a vacation package, this type of insurance offers great peace of mind.
Baggage
Baggage insurance is what most people worry about because we all have heard at least one lost baggage horror story in our lives. Don’t fret: most airlines cover lost baggage as soon as you hand over your belongings. Baggage insurance doesn’t just cover airline loss, though. If you personally lost your bag, or if a theft occurred, sometimes even just if you are delayed, you can get reimbursed up to a set amount.
Accidental Death or dismemberment
The most morbid of all of the insurances, Accidental Death or dismemberment insurance will pay vacationers up to $500,000 if you or a loved one should perish or have an irreparable accident while on your trip. If you already have a life insurance plan, this one shouldn’t be needed.
Now that we’ve broken down the different insurance types, you’ll need to take a look to see if you’re already covered under any of your regular insurance policies. For example, if you already have a great life insurance plan, you won’t need accidental death coverage and if your health insurance covers emergencies abroad, it’ll be smooth sailing on that front. Certain credit cards also offer travel perks and insurance features so it’s best to see what they offer before forking over money for additional coverage. Check out this handy guide to see if your cards offer any traveling insurance benefits.
If you find there are holes in your coverage, next you’ll need to try and figure out what your personal financial loss would be if something catastrophic were to happen. If your trip is costing an arm and a leg, please consider purchasing extra coverage. If your $300 flight didn’t put a dent in your pocket, though, politely decline.
Typically, you’ll want to seriously weigh the benefits of adding extra insurance in these instances: when traveling abroad; if you are older or in frail health; if a good chunk of your trip is non-refundable and/or if your vacation package has a lot of moving pieces (connecting flights, tour groups, excursions, etc.) In these cases, it may be worth the money for you to add the additional travel insurance, if only for some extra peace of mind so you can truly relax and enjoy your trip.
One more tip before you make your decision. Travel insurance can vary widely when it comes to cost as well as coverage. Most travel insurance policies cost between 5-12% of the total cost of your trip, (and it’s usually non-refundable whether you use it or not.) So to make sure you’re spending your money wisely, check “Insure My Trip” to compare plans and prices before making your purchase.
Filing A Travel Insurance Claim
One of the last things you want to do while on vacation is have to file an insurance claim. And if you think that would put a damper on your trip, imagine if the claim were denied. Considering up to 10% of travel insurance claims are turned down every year, it’s definitely a possibility, but one that can be greatly minimized if you’re prepared ahead of time. In order to help you circumvent any possible issues should the unthinkable happen, we’ve compiled this guide to filing a travel insurance claim the proper way!
Choosing the right insurance
Your insurance claim is only as good as the insurance that’s backing it, so do some research on travel insurance before you even book your trip. When you’re ready to get quotes, make sure to download a couple of different policies and read through each thoroughly before making a final decision. Be aware of sections such as pre-existing conditions and read those with a fine-tooth comb. These can be tricky.
You personally may not have any issues that you would think qualify as a “pre-existing condition”, but you’d be surprised by the wide criteria that insurance companies use. For example, if you have a pregnant daughter who goes into labor, some insurance companies can deny your claim as a “pre-existing condition” if it prevents you from traveling. If you’re reading through your policy and you have any questions at all, call the provider to clear it up before you travel. You will want to know what coverage you have before you leave for your vacation so there are no misunderstandings. You’ll also want to choose an emergency contact and provide them with your insurance information just in case they need to file a claim if you’re unable to do so expediently.
Before you file
Once you know that you’re going to need to file an insurance claim, ensure that you document everything. Jot down the names of any customer service reps you speak to and keep all receipts organized and in a safe place to make the process as smooth as possible. If you are on vacation and need medical services, be certain that they’re absolutely necessary. Most travel medical insurance policies only cover true emergencies. If you’re just feeling under the weather, try to ride it out. But if you do find that you need medical services, call your insurance provider immediately, preferably before you even head to the nearest emergency medical center so they can walk you through the correct steps. If your claim involves a crime, file a police report immediately and pay for a copy of the report for your records (just in case the insurance company misplaces the original.) Also, determine whether you need to file through any of your personal insurance providers first, either homeowners or personal health insurance. Your claim could get lost in insurance purgatory if you file through the wrong company first, so verify which insurance should be the primary contact in case of an emergency.
When you file
If you need to file a claim, try to do so as soon as possible. The customer service representative can walk you through the correct process. If you wait too long, you may make mistakes or miss crucial steps that could result in the claim being denied. On that same note, don’t try to handle anything on your own. If you find yourself stranded somewhere, call your insurance provider immediately and they will handle your emergency preparations for you or walk you through the steps you’ll need to take. You’ll risk your claim being denied if you set up your own arrangements, like a hotel or rental car, even if you keep all receipts and documentation. When you begin the process of filing the paperwork, you’ll want to confirm that you have all of the documents required for your claim, and that necessary components are dated. This handy guide from AIG will help you figure out exactly what you’ll need for the major types of claims. Also, keep the golden rule in mind. Even if you’re frustrated, please remember that insurance representatives are doing their jobs to the best of their abilities, so always remain polite, calm and kind when interacting with them. You’re apt to get a much quicker and more satisfying outcome if you use proper manners.
