Summer is here, and that means vacation season is in full swing.
Whether planning a month-long backpacking trip or heading cross country for a wedding, you will be posed with the option of buying travel insurance. While it may not seem like something unfortunate could happen when you’re 1,000 miles away, it’s always good to be prepared for the unexpected.
By understanding what travel insurance is, what it covers and how to find the right provider, you’ll be able to make the best decision on whether or not it’s something you need. Grab your pretzels and drink — we’re taking off into the wide world of travel insurance.
What Is Travel Insurance?
You’ve most likely heard of travel insurance but may not be completely aware of what it is. Essentially, it is coverage designed to protect travelers from risks and financial losses that could potentially happen while away from home. The range of risks that people may experience include missed air connections and delayed luggage to more serious issues like injuries or illnesses, depending on the type of travel insurance you purchase.
What Does Travel Insurance Cover?
While some of the items that travel insurance covers may seem unreasonable or even hard to believe, anything can happen while you’re on a trip. This list isn’t meant to be frightening but to make you aware of everything you could be protected from.
Accidental Death and Dismemberment
Accidental death and dismemberment insurance covers death or losing a limb or eyesight due to an accident. Most health insurance plans don’t provide full coverage in foreign countries for injuries or illnesses. Travel insurance is an additional policy to your everyday health insurance and can help supplement medical costs during a vacation.
Travel insurance also reimburses the cost of lost essentials like clothes, phone chargers or toiletries that you may need if your bag is delayed due to an airline. To qualify for this type of coverage, your luggage must be delayed over a certain period of time — generally from six to 24 hours, depending on the policy.
If your luggage is completely lost or stolen, travel insurance can help cover the costs. Getting airlines to pay for lost bags can be difficult, so this perk is significant. In the U.S., the Department of Transportation (DOT) requires airlines to compensate travelers up to $3,800 for lost baggage. In other countries, people can be given a total of $1,700 to make up for lost possessions. To receive the maximum reimbursement amount, passengers must provide receipts proving the lost bags’ value and contents.
Medical Emergency Evacuation and Repatriation
This coverage also provides money for the cost associated with medical evacuation if you have an emergency and can’t be treated at a nearby hospital. It covers transportation costs to another hospital or your home country if you’re out of the United States.
If a common carrier delay causes you to miss an organized tour or cruise, then missed connection coverage covers extra expenses necessary to catch up to where you need to be next. This only works if you’re late to arrive where you’re supposed to because of something out of your control.
Reinstate Frequent Traveler Awards
Frequent flier miles or hotel points are great ways to purchase a trip. But, if the vacation is subsequently canceled, this benefit can cover any fees required to redeposit those rewards to your account so you can use them later.
Trip cancellation insurance reimburses you for prepaid, nonrefundable costs if you must cancel your vacation due to one of the covered reasons. The most commonly covered causes include:
- Loss of employment.
- Stolen passport or visa.
- Military duty.
- Jury duty.
- Inclement weather.
- Airline strike.
- Natural disaster.
- Financial insolvency.
- Sickness or death of a family member.
What Does Travel Insurance Not Cover?
Travel insurance covers several wide-ranging expenses and situations but doesn’t cover everything. While it’s most likely safe to assume that your needs are taken care of, checking what may or may not be included in your insurance policy before purchasing is crucial.
Here are the most common things not covered by travel insurance:
Worry About Getting Sick
If you hope to cancel a trip because you’re nervous about a potential illness outbreak, standard travel insurance won’t cover this. The same goes if you’re simply worried about flying in general.
Natural Disasters that Begin Before You Purchase Insurance
While natural disaster recovery is typically covered by standard travel insurance, the weather can’t have started before you click the purchase button. If you suspect a hurricane or tornado will disrupt your trip, you must buy travel insurance before the storm is named to have related losses reimbursed.
Last Minute Changes
Yes, your travel insurance policy may cover some last-minute itinerary changes, depending on the provider, but not all shifts will be. Even “cancel for any reason” travel insurance requires a 48-hour notice before the trip to work correctly.
The Importance of Travel Insurance
You’ve most likely overpacked for a trip before and then had to start taking items out once you realize your suitcase doesn’t zip shut. While it’s unnecessary to bring every single possession you own on your trip, it is essential for you to choose to purchase travel insurance.
Vacations Are an Investment
This may not be the case for everyone, but for most people, traveling is a large investment. You may have saved thousands of dollars for your dream vacation, and a disaster or injury could potentially ruin it or cause this investment to vanish. Many companies won’t reimburse you for unexpected cancellations, so travel insurance may be the only way to protect your money from being lost.
When you have travel insurance with trip cancellation benefits, you can get your money back for prepaid, nonrefundable trip costs when you must cancel for a covered reason.
Oversea Medical Treatment Can Be Expensive
It may be uncomfortable to think about, but let’s say you or your traveling companion get injured while on a trip out of the U.S. When you arrive at the hospital, they won’t take your health insurance card, meaning you’ll have to pay the medical bills upfront. These costs can climb into the hundreds of thousands, leaving you financially stuck with no solution. Travel insurance coverage can help with emergencies by paying for losses due to covered medical and dental situations.
Be There for Your Family
It can be challenging to put your life on pause so you can go on a trip. You may have concerns about something happening and you not being able to be there to assist them. With travel insurance, you can always support your relatives, no matter where you are. This type of policy covers unexpected travel expenses if you have a family emergency and must get back to them.
Travel With Peace of Mind
When you know you’re protected from large financial burdens, funding lost luggage and other potential travel issues, you can rest assured that things will go as smoothly as possible. With travel insurance, you can have a fantastic time without stressing about the what-ifs and whether you and your family are always safe. Vacations are meant to be relaxing and fun — make certain that’s the case by clicking yes to travel protection when purchasing your plane tickets or before you leave.
Who Needs Travel Insurance?
Anyone planning a trip would benefit from travel insurance, especially if you’re leaving the country. There are different types of travel insurance to consider: trip cancellation or travel disruption insurance, travel health insurance and medical evacuation insurance. According to the CDC, you should especially consider travel health insurance if you have an existing health condition, are traveling for more than six months or are doing any adventure activities such as scuba diving or hang gliding.
Tips for Buying Travel Insurance
It may seem overwhelming to try and decide which travel insurance company to go with, but don’t let that stop you from making this smart decision. The good news is that almost every company will offer similar services and coverage policies — you just get to decide which one will deliver the highest quality for your budget.
Here are a few tips to get you started in the right direction:
All Travel Insurance Will Be Uniquely Priced
Because no two trips are the same, no travel insurance policy is identical to the next. Generally, the price will depend on the following factors:
- Length and cost of the trip: The longer and more expensive the trip, the higher the coverage price.
- Cost of local health care: If the cost of health care in your destination is expensive, it can impact the cost of your travel insurance.
- Medical conditions you want covered: Any existing medical conditions you have will increase prices.
- Amount of coverage: Like any insurance policy, the most coverage you desire, the higher the costs.
- Your age: This isn’t always the case, but the older you are, the more you’re likely to pay.
You May Already Have Travel Protection
You may already have some form of credit card travel insurance, depending on the type of credit card you use. Some offer trip cancellation and interruption coverage when you book a trip with your card, so it’s essential to see what coverage you may already have. Commonly, extra travel insurance, like medical treatment protection, isn’t included with specific cards, so if you’re looking for a more comprehensive policy, it would be beneficial to get general trip insurance.
Always Look at Exclusions and Restrictions
Every policy is unique. It’s vital that you pay attention to what is excluded or restricted with their potential coverage to avoid any surprises later on down the road.
Getting Travel Insurance Is Simple
You can get travel insurance a few different ways, but the easiest may be to go directly to a travel insurance company. Comparing travel insurance policies from various providers is a great way to find a personalized policy to fit your needs at your desired price.
To get the right amount of coverage, take a close look at the risks you face when traveling. Examine what coverage you may already have and determine what still needs to be protected. Get quotes for trip insurance online to discover the most reasonable price. Then, narrow down your options and pick the best.
Want to learn more about protecting your money while on vacation? Contact Bank Midwest to connect with one of our financial specialists today.