Travel Insurance. Is It Worth The Extra Money?
Most people used to view travel insurance as something “nice to have” but not entirely necessary. Travel experts have observed that attitudes towards purchasing travel insurance have shifted in modern times. More and more travellers have opted into purchasing coverage for their travels. Whether that be insurance for a cancelled flight, medical emergencies, luggage protection or whatever other perceived risk you’d want to protect yourself from, there is a travel insurance policy that can cover you.
With that being said, going over different travel insurance policies can be a challenge for those not well-versed in legal terms. In this article, we’ll go over the basics of travel insurance and the different types of travel insurance available in an easily digestible way.
Travel Insurance Basics
There are five main categories of travel insurance offered, they are: trip cancellation or interruption, medical, evacuation, baggage and flight insurance. You are able to add onto these policies to cover more specific concerns, like identity theft. Most policies are sold in packages, and usually include some form of coverage in all five categories.
Either way, you should thoroughly go through and read your policy insurance to make sure you understand what you are paying for and what you are protected against. If you are unsure about any aspect of your policy, raise your concerns with your travel insurance provider.
Travel insurance is offered by insurance companies, brokers, travel agents or tour operators. Be sure to shop around in order to get the best rate and coverage for your needs. The most recommended source for purchasing travel insurance would be from insurance agencies, rather than travel agents or tour operators because they are not dedicated insurance agents and do not have the required level of expertise.
Some credit card companies also offer travel insurance coverage, so be sure to check with them to see what types of coverage they offer and if you are eligible. As a rule of thumb, your travel insurance should cost you anywhere from 5-12% of the total cost of your trip. This price varies by age, where the older you are the more expensive policies can become. Whereas children are usually covered for free or be less expensive if under the age of 17. Travel agents advise travellers to buy their travel insurance as soon as they book their flight, if possible.
When you are choosing who you will purchase coverage from, be sure to ask your provider about their claims policy and how to proceed in the event that you have a problem. You don’t want to be missing any important paperwork should something happen and you need to file a claim. It is also important to go over how coverage is applied. Some travel insurance only offers reimbursement-only when it comes to trip-cancellation, for example. It’s a good thing that you are able to contact most major insurance companies 24 hours a day.
Types of Travel Insurance
As mentioned above, there are five main categories of travel insurance available. These are: trip cancellation or interruption, medical, evacuation, baggage and flight insurance. Below, you will find basic outlines on what each type of coverage consists of, but this is going to be a very basic understanding and many times policies can change when it comes to different insurance policies. Even policies provided by the same insurance companies often have different coverages between them. Policies may also differ depending on whether you purchased your flight, hotel or car rental through a travel agent. It is important to ask many questions and read the fine print to understand what’s covered.
Trip Cancellation or Interruption Insurance
This type of insurance is the most common kind found in all comprehensive policies. Cancellation insurance coverage is probably the most useful coverage you can get, as it is expensive to cancel any prepaid travel. Oftentimes, you cannot even get the full amount back for a cancelled trip.
Trip cancellation refers to when you cannot go on the trip at all and trip interruption refers to if your trip is cut short. For only a fraction of the cost of the trip, you can protect yourself from losing a lot of money if something were to come up and you can’t make it anymore. Most independent travellers opt out of this type of coverage and simply accept the loss, but you should consider this type of coverage if you are travelling with a partner or family, if you have health conditions or if you plan on paying a lot of up-front money to organize travel tours or accommodations.
Standard trip-cancellation insurance policies cover non-refundable financial penalties and losses you may incur when you cancel a prepaid booking of a tour or flight. Here are some examples of acceptable reasons:
- You or your travel partner, or family, cannot travel because of sickness, death or any other acceptable reasons
- You need to take care of a family member at home who gets sick or has a pre-existing condition
- Your tour company or airline goes bankrupt or cannot perform as promised
- You miss the flight because of things outside of your control (inclement weather or a car accident, for example)
Before purchasing travel medical insurance, check and see if your existing health plan has you covered. Some health plans also extend to travel health insurance.
Most medical and trip-cancellation policies cover pre-existing conditions, but this depends on when you buy the coverage and when the last time you were treated for that condition was.
Many plans cover 24-hour emergency assistance, ambulances, hospital service and emergency dental. Again, the older you are the more expensive this type of insurance will be. Travelling to at-risk countries can also void your coverage.
Read More: Have A Chance to Explore Travel insurance
Evacuation insurance ties into medical insurance. It covers the cost of getting yourself transported to the nearest medical facility in case of emergency. This may be vital if you are travelling to remote areas. Sometimes, the coverage can get you home after an accident.
Be sure to talk to your insurance provider to confirm what will be covered before and after you get to the hospital.
Baggage insurance covers two main instances: it will reimburse you if your baggage is delayed and you need to buy clothes or medication, and it will cover you if your baggage is lost, stolen or damaged during your trip. This type of insurance is usually covered in comprehensive insurance policies and it is rare to be able to purchase it on its own. There will be a cap on how much reimbursement you will receive for certain items like jewellery and electronics.
Flight insurance offers financial protection against losses that are related to air travel. It is not to be confused with flight accident insurance, which covers you if the plane crashes. Most of the time, people purchase this insurance when they are taking international flights because of the high fare. This can protect travellers in the event of a delay or cancellation due to bad weather or mechanical failures.
Robyn Hang is a content writer for BreezeMaxWeb. When she’s not writing you can find her singing karaoke in her car or brushing up on her Mandarin.