Find us @

Feature

What to consider when deciding whether or not to buy travel insurance

People are able to avoid potentially crippling costs by getting and keeping proper insurance.

Published

on

SECOND AVENUE

This story was taken from NextAvenue.org and reproduced with permission.

Nancy Park, 80, fell unwell while on a tour to Hawaii with her daughter Lori Park, a resident of the Chicago region. Before being flown to Mexico and then returning to the United States, she spent five days in the ship’s infirmary.

The two women had purchased $436 worth of travel insurance prior to embarking on their journey, which covered all of the medical care and transportation costs, saving them from incurring unforeseen bills totaling thousands of dollars.

According to Lori Park, she never goes on vacation without travel insurance. Every time I travel, I think it important, she says.

There are five main categories of travel insurance: flight policies, which provide compensation in the event that your aircraft crashes; baggage insurance, which pays for damaged, lost, or stolen belongings; interruption/cancellation insurance, which reimburses you for trips that aren’t taken; medical insurance, which covers doctor visits and hospital stays; and evacuation coverage, which covers the cost of transporting you to the nearest medical facility. They can be purchased singly or in packages.

According to travel industry experts, insurance can assist individuals in avoiding potentially catastrophic charges, as it did for the Parks. However, not everyone needs it.

According to Jay Smith, president of Sports Travel and Tours in Hatfield, Massachusetts, which specialized in sports vacations, insurance raises the price of a trip by around 13%. There isn’t a practical need for insurance “if someone is traveling locally, or if the airfare is refundable or useful in the future, and the hotel has a cancellation prior to travel—even if it is 48 hours before—”

If you intend to stay with friends and purchase your ticket with redeemable frequent flyer points, you do not require insurance that covers the cost of lodging and travel. You would only insure against situations that could result in significant financial losses (for example, developing a serious illness requiring hospitalization or missing a cruise because of flight delays).

Also see: 12 methods to inflation-adjust your holiday budget

You should think about the type of coverage you require and how much risk exposure you can afford when choosing a policy, and then shop around for a low price.

Your destination, modes of transportation (scheduled flight or charter? rental vehicle or taxis? lodgings (cruise ship? resort? Airbnb?) activities (swimming with sharks? skydiving?) and the local climate (is it hurricane season in the Caribbean?) all go into how much an insurance coverage will cost.

After that, they consider age and current medical issues. A person in their 80s will pay more for insurance than a person in their 70s. People in their 70s who were properly immunized and were planning a lengthy foreign cruise had received quotes of $10,000. Shopping around and weighing insurance, perks, and pricing is crucial for this reason.

What kind of coverage do you need or want? You could choose to insure you and your party against COVID while it is still active. Instead of secondary coverage, which requires you to first file claims to your usual health insurer and then pursue the travel insurance provider for any outstanding balance, choose a policy that offers primary medical coverage.

The amount of medical and evacuation coverage you get will determine the price of your travel insurance. Better but more expensive are higher dollar caps. You might want to think about purchasing “cancel for any reason” coverage, which, as the name implies, will pay back the cost of a trip you cancel for any reason, even a last-minute change of heart.

Especially during hurricane season, Dan Drennen, director of sales and marketing at the Travel Insurance Center in Omaha, Nebraska, advises travelers to protect their pre-paid, non-refundable travel expenses. If you have legitimate trip cancellation-interruption coverage that was acquired before a storm was announced, you may rest easy knowing that it won’t wipe out your bank account if a hurricane does wreck your vacation.

A hurricane is not necessary to demonstrate the necessity of thinking about travel insurance. According to Janet Jones Caraker of Island Jack’s Travel in Dexter, Missouri, she is acquainted with one traveler who traveled to Ireland with her husband, grown children, and grandchildren. The woman’s spouse passed away while they were there because they choose not to purchase insurance.

There is no greater anguish, according to Caraker, than having to shell out $100,000 to have her husband’s remains cared for and transported home. There are those who can, but the majority can’t.

Not only should you consider how much you would lose if you can’t go on this trip or decide not to, but also how much would a different vacation cost you? How much more expensive will travel, lodging, and activities be the following year or the year after that? And when will you get the chance to take that vacation, especially if it’s a bucket-list excursion that calls for coordinating the vacation days of numerous families’ members?

See also: These misconceptions regarding travel insurance and what it covers should not be believed.

Price and coverage can differ from one insurance to the next. Start by seeing if your credit card offers coverage to reduce the cost of insurance. If you decide to purchase insurance, only purchase what is necessary. For example, if your luggage is worth $2,500, do not cover it for $15,000 in total. You don’t need to insure replaceable points if you pay for a cruise, resort, or flights with them.

Medicare generally does not offer coverage outside of the United States. Check to determine if such coverage is offered by any private Medicare Advantage or Medicare Supplemental policies you may have. If not, you will require travel insurance coverage that will pay for medical expenses incurred overseas. Consider an annual coverage that covers all of your excursions if you travel regularly.

Will the insurer let you pay for insurance in a similar number of payments if you’re paying for your vacation in advance? If you have only paid a 10% deposit, you don’t want to pay the whole insurance fee.

Identify the definition of a pre-existing condition. Diabetes, for instance, is typically only regarded as “pre-existing” if your prescription is changed no later than two weeks before to your departure.

The main line is that you must study the small print and take extensive notes while looking for travel insurance so you can compare what is provided, what is not, and how much it will cost.

The author of 36 books, Judy Colbert, writes about travel and the industry.

Additions from Next Avenue: