Do You Need Travel Insurance

In lieu of recent international events, the earthquake in Haiti and Europe’s volcanic ash cloud, travelers not covered by insurance were probably wishing they had purchased travel insurance. According to statistics, 30% of Americans who travel overseas carry some form of travel insurance. These numbers have increased 10% since the 911 terrorist attack, SARS and the H1N1 epidemics.

Appropriate travel insurance coverage is designed to protect travelers from unforeseen expenses related to natural disasters or extenuating circumstances which result in extended stays, emergency evacuations, bankruptcy, trip delays, interruptions or cancellations. Globe trotters who have invested thousands of dollars or more on an overseas journey are advised to look into protecting themselves with this type of insurance.

When planning a vacation or business trip overseas, determine if current health, homeowner’s and auto policies include coverage abroad. Many American health plans will not cover these destinations. Certain homeowner’s policies protect personal property regardless of location. Protection not guaranteed by current policies can be obtained through a traveler’s plan that provides protection for less money than a complete package alternative.

Bundled or packaged travel insurance typically costs 4 to 10% of the total trip expense and varies depending on the age of the insured. Varying amounts of coverage can be purchased. These policies provide reimbursements for:

  • Trip cancellations
  • Cancelling flights related to work
  • Trip interruptions
  • Missed connections
  • Trip delays
  • Baggage that is lost or delayed
  • Pet care
  • Emergency accidents or illness
  • Emergency evacuation and repatriation of remains
  • Accidental death or dismemberment
  • Accidental death or dismemberment in the air only
  • Collision damage
  • Optional sports coverage

Less expensive polices can be obtained that cover specific desired areas of coverage. Policies can be purchased, for example, to cover only possible medical expenses and emergency medical evacuation. These policies average $25 to $30 and provide $50,000 for medical related costs and $500,000 for emergency evacuations.

There are certain situations when trip cancellation policies are especially advised. Ocean cruises are expensive and unless a trip is cancelled more than 2 months in advance, travelers may not be eligible for reimbursements. From a medical standpoint, passengers are in the middle of the ocean with limited medical care available, in this instance adequate medical coverage is also something to think about.

If planning a trip far in advance, cancellation protection ensures reimbursement should something delay or cause a trip to be cancelled for unexpected reasons. Travelers are advised to purchase this insurance within 14 to 30 days of making a deposit on a trip to ensure coverage acceptance.

International flights tend to be expensive and most times are not refundable. Travelers are encouraged to purchase cancellation protection to cover the amount of airfare.

Domestic flights may allow changes, but generally are accompanied by a penalty. Depending on the cost of these flights, passengers may want to consider airfare coverage.

Trip cancellation insurance protects passengers in numerous events:

  • A return trip is delayed or cancelled due to injury or illness of you or a traveling companion.
  • The unexpected death of any person taking the trip.
  • Inclement weather causes the delay or cancellation of a trip. (The insurance must have been purchased prior to the weather event.)
  • An unexpected strike by any of the travel services.
  • An unexpected disaster on the home front causes delay or cancellation of the trip.
  • You or a traveling companion are unexpectedly called to jury duty, resulting in the delay or cancellation of a trip.
  • A terrorist incident occurs at the destination of the trip and trip is delayed or cancelled.
  • Members of the military who are unexpectedly called to active duty and must cancel a trip.
  • An unforeseen financial situation that causes a trip to be delayed or cancelled.
  • Being the victim of an assault and the trip must be delayed or cancelled.
  • Involvement in an accident on the way to the airport.
  • Delay or cancellation of a trip due to the theft of necessary travel documents. Must be documented by law enforcement.
  • An illness, injury or death of friends or family abroad resulting in lost accommodations.
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