There are many kinds of travel insurance from lost luggage to trip cancellation to medical emergency coverage, but not everyone -- nor every trip -- requires it. Before buying any additional policies, adventurers should check the medical, auto, home and health insurance they currently have to see what’s already covered away from home. Up to 30% of travelers buy some kind of insurance, many of them needlessly.
Common Kinds of Travel Insurance
The type of destination, the cost of the trip and whether or not children are involved are factors that can help travelers determine the kinds of situations against which they need protection:
- Trip cancellation or interruption: Refunds the insured if he or she has to cancel plans before or during a trip. Usually confined to illness, injury or death of the insured or an immediate family member. Some include coverage when those conditions apply to a traveling companion.
- Flight delays or cancellations: Usually covers lodging, meals and new travel arrangements after a delay of six to 12 hours, depending on the policy.
- Medical emergencies: Most cover evacuation in an emergency. Some include access to an English-speaking doctor, payouts after loss of sigh, limb or life, or transportation of remains after insured's death.
- Lost baggage: Policies usually limit payouts, exclude some items (such as professional equipment and medications) and don't cover all damage. Many people don't realize airlines already insure bags -- up to $3,000 per passenger.
- Travel documents: Replaces passports and other important papers.
- In-flight life insurance: Coverage for injury or death while on the plane, or in a crash.
Additional Travel Insurance Policies
Further coverage is available to guard against loss in these situations:
- Layoff: More and more insurers are offering layoff insurance for people who lose their jobs and can no longer afford a trip. Most require one to five years' employment with the same company. Buyouts, resignations and firings are not generally covered.
- Terrorist attack: Reimburses travelers if there is a terrorist incident. Does not apply to government actions.
- Foul weather: May be a good idea in hurricane season, but in most cases, it must be purchased before a storm has a name.
- Bankruptcy: Advisable in troubled financial times but only applies is airline, cruise line or other travel business ceases all operations. May require purchase soon after deposit.
Cost of Travel Insurance
The cost of travel insurance varies according to the type. Trip cancellation will range as much as the price of a short flight compared to an extended African safari -- the more expensive the trip, the higher the insurance bill.
Cancellation insurance tabs are often based on a percentage of the trip cost and the age of the traveler. For example, someone who’s 35 and planning a $2,000 cruise might pay 7%, or $140, for trip cancellation insurance that provides a full refund. More comprehensive coverage can cost up to 10% of the trip’s value.
Insurance companies sell as much coverage as customers are willing to buy, so it's important for travelers to figure out what they actually need to avoid over-buying. Not all policies are alike so it's important to compare the expenses and benefits of different insurers. Packages may cost you less than separate policies for each type of insurance.
Tips for Buying Travel Insurance
It pays to shop around, keeping these tips in mind.
- Think about the details of the trip. Mountain-climbing adventurers may require more emergency health insurance than lying on the beach.
- Before automatically buying insurance offered by a travel agency, check out policies elsewhere.
- Read carefully the list of excluded travel vendors to make sure the ones being used are included in the policy.
- Compare the coverage of existing medical conditions among several policies.
- Those studying abroad should explore policies geared specifically to students.
Someone who takes several trips each year may find it less expensive to buy annual travel insurance instead of paying by the trip. Most yearly policies include medical evacuation, coverage life-and-limb loss and illness and some protection against lost luggage.
How to Avoid Travel Insurance Scams
Counterfeit companies are at first glance not always distinguishable from genuine insurers, so prospective buyers should take these precautions:
- Make sure the contract contains the word ''insurance,'' not just "protection" -- even if the salesperson calls it "insurance." Insurance, regulated by the insurance laws state, is far more effective.
- Check to see if the company is underwritten by a legitimate underwriter.
- Determine through the state insurance department if the policy is being offered by a licensed agent eligible to sell in that particular state.
- Look to see if the company is a member of the U.S. Travel Insurance Association, which deals with reputable firm.
- Contact the Better Business Bureau to see if the company is in good standing.
Trip planners can report fraud to the Federal Trade Commission. Reimbursement for money paid to fraudulent companies may be found through a credit card company or small claims court.
Related Travel Insurance Resources
About.com Adventure Travel Insurance [1]
Airline Bankruptcy Insurance [2]
About.com Baggage Loss Insurance [3]
About.com Budget Travel Insurance [4]
About.com Getting a Good Deal [5]
About.com Impending Hurricane Insurance Buying [6]
About.com International Travel Insurance [7]
About.com Kinds of Travel Insurance [8]
About.com Real-Life Medical Cases [9]
About.com State Checklist [10]
About.com Student Travel Insurance [11]
About.com Questions to Ask [12]
About.com Top 10 Tips [13]
About.com Travel Insurance Children [14]
About.com Weather Guarantees [15]
Ambest Legitimate Underwriters [16]
Better Business Bureau [17]
Bureau of Consular Affairs [18]
CNN.com Scams [19]
E Commerce Annual Travel Insurance [20]
Federal Trade Commission [21]
Hasbrouck FAQ [22]
Independent Traveler Insurance Overview and Medical [23]
Medex International Medical Insurance [24]
Reuters Questions to Ask [25]
Squaremouth Layoff Insurance [26]
Trip Insurance Store Terrorist Incidents [27]
U.S. Travel Insurance Association [28]
Travel Insurance Companies
Access America [29]
Council Travel [30]
Diverse Alert Network [31]
Global Cover [32]
Global Travel Insurance [33]
Independent Traveler Medical [34]
Insure My Trip Comparison Site [35]
Travel Insure [36]
Travel Protect [37]
Travel Secure [38]
Travelers’ Insurance [39]
World Traveler [40]
Comparisons Among Travel Insurance Companies
Squaremouth Comparison Site [41]
Travel Guard [42]