Imagine this scenario, you have saved up all year for your annual family vacation on the newest cruise ship, you booked your airline flight to Miami where the ship departs, you booked your cruise and your Uber to the airport. Your itinerary is set. You got it all worked out, right? Now you’ve arrived at the airport for your flight to find out that it has been cancelled due to severe weather. The next flight doesn’t leave until the following morning which is a problem because the cruise also leaves in the morning. Now your entire trip is in jeopardy because the ship is not going to wait for you. Here is where travel insurance can save you a boat load of money as well as a lot of headaches.
There are two basic types of of travel insurance. One that is covered through their Vacation Plan or Package Plan as it is also known as. The vacation plan covers things like vacation cancellations due to missed flights, medical emergencies, delayed or lost baggage, emergency evacuation, interrupted trips and more. This is the most popular type of coverage because it overs most things that most people are looking for.
The second type of travel insurance is a travel Medical Plan. This plan is for people who plan on traveling outside their own country and not concerned about cancellations, delays, lost baggage etc. Traditional medical coverage does not cover most people when they leave their country. This policy covers the gaps their regular insurance does not cover. This plan covers evacuations, medical emergencies, and sometimes life insurance. Some of these coverage’s can cover things like emergency medical evacuation, long term medical coverage abroad, medical coverage for pre-existing conditions, renewable and multi-trip protection.
Other less popular insurance plans include things like Accident Plans. This plan covers serious injury that results in loss of life or dismemberment. The benefits paid by these policies are in addition to any other pay outs from other policies.
Another kind of policy is the Evacuation Plan. This plan is usually sold on an annual basis as a membership, not a as needed basis like the others. The evacuation plan covers the expense of transportation out of the country you are visiting.
The most common plan is the Vacation plan because it provides the most coverage under one plan.
Things to consider when choosing the right plan. Try making a list of the coverage you feel are most important on your trip. Take for example you and your family are taking a trip to Indonesia. Because of it’s high volcanic activity and propensity for natural disasters you would be looking for coverage that includes medical emergencies, evacuations, missed connection coverage etc. Knowing what your minimum coverage requirements are will help to filter out the policies that don’t meet your needs. Here are a few of the most common coverage most people are looking for: Emergency Medical, Medical Evacuation, Cancel For Any Reason, Hazardous Sports, Hurricanes & Weather, Terrorism, Employment Layoffs, Missed Connections and Rental Car Coverage.
A few other things to consider:
Decide if you want single trip coverage or annual policy. If you plan on traveling multiple times during the year then the annual policy may be a better option. Make sure you check your home insurance policy. Some policies may cover your personal belonging outside your home.
Shop for your policy online. Like most things now days you can usually find better prices online. Most travel agencies and airlines inflate their insurance premiums to pay their sales people. Sometimes rates can be inflated as much as 50%.
Consider group travel policies. If you are traveling as part of a group consider purchasing a group policy instead of separate policies for each person.
Check your credit cards. Some credit cards have travel insurance as an ad-on. Make sure you check the fine print because some policies don’t cover medical or evacuation coverage. You may have to use that same credit card to pay for your flight with the same credit card.
Be careful of cheap insurance. Make sure to read the fine print. Not all cheap policies have sufficient coverage and may skimp on some of the necessary things you need. The total cost of your insurance should be approximately 3-8% of your total trip cost.
Make sure to government warnings. Some insurance policies will not cover you if there is a government warning against traveling to the country.
Check to see if your stuff is covered. If you happen to be traveling with expensive items make sure to check your policy to insure that each item is covered. Some policies set a per-item limit on coverage. So if your $1500 laptop is only covered up to the $500 you may need to rethink your policy.
Read your cancellation policy. Sometimes life just gets in the way and unexpected things happen keeping you from taking your trip. Find out what your cancellation policy is just in case something comes up.
Utilize the free look period. Every insurance policy has a 10-14 day grace period that allows you to look it over and make changes or cancel if necessary. It is very important that you review the policy and fully understand what is covered and what is not. Here are some things you should be looking for in your policy.
- Check the coverage limits to ensure they are adequate for all people insured.
- review the cancellation policy to be sure they cover your risks.
- If you are taking a cruise or tour that departs, verify the missed connection coverage will provide protection if you miss the departure time
- Check the trip dates are correct, including the initial trip deposit date and make sure all personal information is correct.
- Review the deductibles and make sure your are comfortable paying them if needed.
- Find out what is considered a “covered delay” and make sure if sufficiently covers your needs.
- Verify the per-person trip cost is accurate
- Read the policy to see what is not covered under the policy. Consider things like medical care exclusions. Theft due to negligence, maximum number items covered or total amount covered.