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The In's and Out's of Travel Insurance
By Christine Columbus, Inc. Co-founder, Robert G. Brost
Travel insurance is an important but often overlooked part of your vacation. Whether you are traveling to a foreign country or to the next state you should consider travel insurance. Some of the reasons to have insurance are to cover medical expenses, life insurance to benefit your family in case the unthinkable occurs, or trip insurance when something goes wrong, before or during a trip.
You can purchase travel insurance as package policies, which offers coverage for a number of various occurrences, and then you can add supplements to those package coverages. There are two basic varieties of travel insurance: "travel medical policies" which offer more medical coverage than basic policies - but usually no refunds if the trip is cancelled or interrupted - and "medical transport" policies which offer emergency medical evacuation on a private plane. And since the September 11 attacks, insurers have added bells and whistles to many of these policies, for instance, beefed-up 24-hour emergency assistance programs.
Yet as services and options grow, the fine print is getting finer. While package policies are ideal for older adults because they include trip cancellation, they generally provide $50,000 or less in medical coverage. Travelers going on a trip for a month or longer, or on several trips throughout the year, might want to supplement the package policy with a travel medical policy.
Hospitalization overseas can be hugely expensive and these travel medical policies provide as much as $2 million in medical coverage for travel of up to a year in length. Most of the policies won't cover medical problems that have previously occurred within a specified time - usually one to five years preceding the purchase of a policy. A few plans do offer a traveler coverage for an "acute onset" of a continuing condition but check costs and coverages carefully. The benefits also decline under such plans the older a traveler is.
Similar benefits and restrictions apply to multi-trip medical policies, which offer medical coverage for multiple trips lasting as long as 15, 30, or 45 days throughout one year. Geared to travelers taking three or more trips a year, these plans offer as much as $1 million in coverage. Benefits also decline with age. Because they don't include refunds for cancelled trips, they too work best as a supplement to a package policy.
For those who are headed to the jungle and really want to ensure they can be airlifted to safety, a medical transport or evacuation policy might be a good bet. But the evacuation is made at the doctor's and insurer's discretion, and is usually made by commercial jet.
Policies vary widely, and there are sometimes details hidden in the fine print that could make the several hundred-dollar investment pointless. Some, for example, won't cover you if there is a gathering of more than 50,000 people (think the Olympics) in the city you are visiting. Other deny coverage if your injury occurred in the air or on the water - not exactly a comfort in a time of worries about stinger missiles and shoe bombs. In addition, no travel insurance policy covers acts of war, only acts of terror.
Travellers who are passionate about hitting the road regardless of the danger, travel coverage can make sense under some circumstances. The main question is whether your airline and hotel will let you change your plans in the event of a terrorist attack. Some hotels and resorts are dropping cancellation fees.
Buying travel insurance may also make sense for people whose health care plans specify that they won't cover medical care overseas.
Some variables to look out for when considering such insurance:
- What am I already covered for by my existing policies?
- Does the policy include domestic as well as international travel?
- Look for policies with the most liberal cancellation terms.
- Check to be sure your destinations aren't excluded on a technicality.
- It's not all bad news.
- Shop around.
As with most services your investigation should start with your current coverage - medical, auto, home owners, umbrella, etc. Find out what you are already covered for. If you have medical coverage, check with your insurer to find out the specifics regarding your planned destination. If you are driving out of the country definitely check with your auto insurer. Purchase any extra coverage needed. You may want to ask about an international roadside assistance policy. Auto breakdowns and accidents are bad enough at home but the problems are compounded abroad. Limited travel insurance is often an overlooked perk if you've purchased your vacation with a Credit card. Check coverage through your Credit card company, or shop for a card that offers travel insurance, (it might be worth signing up for a new card if the coverage is adequate and restrictions are reasonable). If you are traveling with a group you may be able to get coverage cheaper as a group rather than individually.
Even if you're traveling abroad, you might want domestic coverage if your itinerary includes layovers or flight changes at U.S. airports.
For instance, if terrorists strike, some policies will let you cancel only if you are departing within 10 days of the attack. Other policies will let you cancel even after 30 days.
Some policies provide both international and domestic coverage for any terrorist event within 30 days before your departure. But may have a clause that if you are going somewhere that suffered an attack in the past six months you aren't covered or if your destination is listed on U.S. State Department Warning list. Some policies also require you to buy the insurance within seven to fifteen days of making your first payment on the trip in order to receive the terrorist coverage. They don't want customers to try to snap up policies at the last minute if global terrorism fears heat up.
Many insurers have also revised their coverage to protect you if your airline goes out of business - which can bring some peace of mind. But check whether any airlines are excluded. Some insurers exclude airlines operating under Chapter 11 bankruptcy protection.
Sometimes you will pay more for less coverage if you purchase policies through a travel agent who can make large commissions on sales. This is not always the case, but it's buyer beware! The last few years airlines have discontinued commissions to travel agents, so many agents have looked for new sources of revenue and travel insurance is one of them. Shop around for the best deal, but the best deal isn't always the cheapest.
As you can see the decision to purchase travel insurance involves some homework be done way in advance of the trip. Travel is getting more expensive, so is travel insurance however, travel conditions, I'm sorry to say, are not getting any better. At this writing, the Scotland's Glasgow Airport has been closed due to a incident where 2 men rammed a flaming vehicle into the main terminal front glass doors.
The American Automobile Association (AAA) indicates travel is up in the U.S. for 2007. Airline profits are up, and so are travelers complaints. Those profits are up because of cost cutting measures and travelers are suffering. Fewer airline personal, less flights, over-crowed crammed plane conditions, less basic necessaries (charging for meals, bottled water and up charges for window & aile seats). Canceled flights are up 91 percent from a year ago.
All doom and gloom? No, because while we put up with the hassles, travel is still exciting, fun and adventurous and is something we do look forward to - especially if the travel allows us to kick back and relax or spend time with family & friends or give us an opportunity to make new ones, even travel the world after college, or take a romantic honeymoon. With each time we travel we gain a greater appreciation of life, how we now live it or how we'd like to change it!
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Please let me know how I can assist you with your travel needs.
Cheers,
Annette
President & Co-founder
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