Murphy’s Law is one is the most quoted maxims in history, and it basically says that if something can go wrong, then it will. While this is of course an exaggeration, when you go and travel sometimes this is much truer than you would like. Some things that can go wrong are inconveniences, but they sometimes feel like major catastrophes.
If you’re really unlucky you may even actually experience a real catastrophe such as a terrorist attack or a super-hurricane. You just never know, which is why you need to learn how to choose travel insurance. You should buy insurance if the entire trip costs more than $5,000 because that’s a considerable expense.
Insurance is also a good idea if you’re a nervous traveler who worries constantly about things that can go wrong, because the travel insurance will at least give you some peace of mind. It’s also a good idea if you’re taking a cruise, a packaged tour, or a journey with a lot of complicated moving parts.
And it’s essential when you’re leaving the country, especially if you’re on Medicare as medical evacuations can cost a bundle and you need to pay up front, and usually Medicare doesn’t provide coverage for outside the country.
Benefits to travel insurance
There are many benefits to travel insurance, just in case some part of you is thinking of it as an unnecessary expense. Some people think that they don’t need travel insurance because they already have health and homeowner’s insurance and a credit card to cover emergencies.
But these things don’t offer any protection when you cancel your trip or interrupt your trip. And, of course, there’s the matter of lost luggage.
Even though you pay a lot for checked luggage and there are fewer checked bags as a result, about 26 million suitcases still go missing every year. According to airline insiders, most late bags turn up within two days.
But that’s little consolation when you’re affected. It’s always a terrible feeling when you’re waiting for your bag to appear on the carousel and it doesn’t. Sometimes the luggage may even get lost for good.
A million suitcases were never recovered at all, either because they lost their identifying tags along the way or they were stolen.
How to Choose Travel Insurance
Read the Travel Insurance Reviews
One way of looking at travel insurance companies and policies is to look at their website and see the features of their various policies.
It should cover the basics of what you need, and you should be able to get a quote easily online.
You should also make sure to read the fine print as well. Sometimes when it seems like it’s too good to be true, it probably is.
There’s one policy that says they cover up to £200 (about $300) for cash lost or stolen while travelling, but the excess (the amount you’re responsible for before the insurance kicks in) was also for £200, which meant the cover was actually useless.
But you can’t always rely on the ads. Hopefully you’re old enough to realize that what a company says may be different from what they actually do. This is especially true of insurance companies, which of late have earned a rather dismal reputation for paying out.
What travel insurance companies say may be different from the accounts of various people who actually went through claiming from a travel insurance company. That’s why you need to read the travel insurance reviews written by people who actually dealt with the insurance company when they lost their luggage or their flights were cancelled.
Read their accounts fairly and see what they found. So what considerations should you focus on when how to choose travel insurance learning? Here are some things to look for when choosing a travel insurance company and a particular travel insurance policy.
- Check the “free look period”. This is the period of time you have after you’ve purchased a travel insurance policy when you can still ask questions about the policy or shop around for something better. During this period, you can go over your policy again and ask questions so you gain a better understanding of your policy. If something doesn’t fully satisfy you or if you found another insurance policy that’s more suitable for your current needs, you can terminate the contract during this time without paying additional charges and get a full refund.
- Do they cover the frequency of your travels? Now getting a separate travel insurance policy may make sense when don’t travel a lot. But if you’re a frequent flier, then perhaps a yearly multi-trip policy may be a more sensible choice. It saves you the bother of arranging for travel insurance every time and if you travel at least 3 times a year then a multi-trip policy can actually provide you with savings.
Just make sure that the places you go to are all covered, and it can be much cheaper if it doesn’t cover places that you don’t go to.
- Get one policy that covers the entire party. It’s much cheaper for your family when you get a signal insurance policy that covers everyone, including the kids. It may be difficult to find a single insurance policy to cover everyone in your family when they’re travelling independently.
- Check the coverage limits and the excess. How much exactly do you get in return when the entire trip is cancelled, or if you missed a flight? How much do you get when your baggage is lost? You may also want some personal liability cover, a cover on rental cars, and of course, medical cover that applies for any pre-existing condition you may have.
You can’t assume that you’re valuables are covered by your insurance policy. Some policies don’t even cover commonly lost items such as cell phones, tablets, laptops and other portable electronic gadgets. The same may also apply for your passport, as well as your jewelry and expensive sunglasses. You need to ask your insurance provider if these things are covered.
Missed or delayed flights are another reason why travel insurance is such a boon. You see, airlines are under no legal obligation to assist you if your flight is delayed when the reason is beyond the control of the airline.
This means that if the flight is delayed because of the weather or mechanical issues, the airline is only obligated to get you a seat on the next available flight. With travel insurance, you may get enough to pay for meals and a hotel room for the night should these things become necessary.
Typically, there’s a minimum number of hours for the deal before this coverage can be used, and there may be a limit per day. You may not be compensated fully if you suddenly decide to get a penthouse suit and eat lobster while waiting for the next flight.
You may also want to think about special covers, such as if a small airline you’re using or a hotel you’re staying in suddenly goes belly up.
- See if your activities are covered. It doesn’t make all that much sense if you’re going on a ski holiday and your insurance policy doesn’t expressly cover skiing. Some policies offer an exhaustive list of covered activities, including camel riding (which is actually a very popular activity among tourists in the Middle East) and bungee jumping.
Of course, you need to note the restrictions that apply. For example, the policy may be voided if you’re not wearing a helmet at the time of your accident. Or perhaps the coverage applies only if you’re with an official guide. If you’re planning to go scuba diving, the policy may only cover you when you stay within a defined depth.
In general, the more dangerous activities are allowed the more expensive the policy becomes. You may not need this part when you’re greatest wish is to go inside museum, but if you’re riding a motorcycle or an elephant you need to make sure that it’s an activity that’s covered by the policy.
So think about what you might be doing on your vacation and list down anything that seems a bit more dangerous. Make sure all your transportation choice and your potential activities are covered.
- Find the details about your medical coverage. One thing you need to remember is that travel insurance is different from your regular medical insurance, so getting a checkup while on vacation isn’t covered by the travel insurance policy. Travel insurance is basically accident insurance, and it’s mostly about paying for emergency care for you when you get into an accident doing something that’s covered by your policy.
Some people think that when they get injured or sick on their travels and they need medical attention, the insurance company will pay for their expenses to get them home to the hospital they trust.
That’s not true at all. What travel insurance companies mean by medical evacuation is that they’ll provide medical transfer to the nearest medical facility, and that’s determined by the insurance company.
So if you insist on getting home from abroad to a hospital you trust back in the US, you’re going to have to foot the bill yourself.
And evacuation flights alone can be financially disastrous. A medical evacuation flight from London to the US with two pilots, a paramedic, and a critical care nurse can cost up to $70 thousand.
From Africa or Asia, the cost can reach up to $140 thousand, and you’re not yet including the hospital expenses.
- You should also check the trip cancellation protection. Some deposits and trip payments are non-refundable, so if the trip is cancelled for some reason then you can get back what you already paid. You may also interrupt your trip because of some emergency, such as a death in the family back home.
The travel insurance company may have to approve the reason for the trip cancellation or interruption before you are compensated, and for the cancellation there may be only a limited time frame for you to use it.
- Also check if you have liability insurance and if you get coverage for your legal fees when these become necessary. For example, what if you accidentally bump another car or a pedestrian on the road when you’re driving your rental car?
- Do they offer 24-hour assistance? Often you may panic when you get into trouble in other country, so you need a calm and knowledge source of information. The insurance company should be available 24/7, so that you can consult on what you ought to do when there’s been some trouble. At the very least, you should also get some phone numbers of local contacts you can consult.
Many of these points are crucial, but the reviews can paint an accurate picture as to how the insurance company interprets the various details. For example, if you’re drinking alcohol and you get into an accident, you may not get reimbursed.
Some policies say that the coverage doesn’t apply if you engage in “reckless” behavior, and again there’s no hard and fast definition for this term. Some anecdotal reviews may help you understand just what the company means by reckless behavior.
They may even think that walking alone late at night constitute reckless behavior on your part. So read the travel insurance reviews to get a better sense of how the company defines these vague terms.
Travel Insurance Companies
Which travel insurance companies should you trust? That’s a very good question, and one answer is that you should only deal with insurers that are listed in the U.S. Travel Insurance Association website. Here are some good options when choosing a travel insurance company:
- Allianz Travel Insurance. Here you get a 10-day free period, which is pretty much standard in the industry. That means you have ten days after purchasing the policy to get a full refund.
The plans Allianz Travel Insurance offers are based on which state you live in. They offer coverage for a single trip, on an annual basis, or just for the rental car you get. To get a quote, you need to specify the age of the people traveling in your party, the departure and arrival date, the travel agency, and how much this trip is costing you.
In general, the cost of insurance will run about 4 to 8 percent of the prepaid non-refundable cost. You get your cash back for prepaid nonrefundable payments when you cancel your trip as long as the cancellation is due to a reason covered by the policy. These reasons may include a sudden medical emergency, employer termination, jury duty, or even terrorist attacks.
Once you cancel your trip, you have 72 hours to notify your travel suppliers. The insurance coverage is underwritten by either BCS Insurance Company which is rated “A-” (Excellent) by A.M. Best Co. or Jefferson Insurance Company which has an “A” (Excellent) rating.
Their 24-hour hotline assistance is excellent as well. It’s staffed with multilingual specialists who can help you deal with all types of emergencies. These include offering help in reporting lost baggage, replacing your passport, and securing cash for emergencies.
They can refer you to local legal assistance, and even guarantee payment so you can gain admission to a hospital. You can still buy travel insurance when you have an existing medical condition, provided you comply with certain rules.
You have to be a US resident who is medically able to travel on the date you bought the policy, you have to buy trip cancellation coverage that covers the full cost of all your nonrefundable trip payments, and your insurance plan must be purchased within 14 days of your original trip deposit or initial payment date.
The limits of the coverage will depend on the plan you choose. A default by your travel supplier is also covered, but the travel supplier must be listed as a covered supplier.
- Travelex Insurance. This insurance company also offers several basic travel insurance plans to set your mind at ease. The Travel Basic Plan offers essential coverage, including trip cancellation and interruption benefits, coverage when a travel supplier becomes insolvent (side excursions are included), and coverage when you miss your cruise connections.
Emergency medical evacuation is also part of the policy. They also accept a very long list of reasons for trip cancellation. This plan should suffice for short domestic vacations, and it’s quite affordable. You can receive reimbursement for eligible losses with no deductibles.
The Travel Select plan is the company’s most popular option. Aside from the features included in the Travel Basic option, your kids under 21 year of age who come with you are also covered without additional cost.
There’s a 21-day pre-existing condition exclusion waiver available, and the transportation upgrade comes with rental car insurance policy. You also get a 24-hour AD&D (accidental death and dismemberment) benefit.
Other upgrades include options for families that allow coverage for accidental death and dismemberment, medical protection for traveling pets, or even movie rental reimbursement for overnight delays.
For adventurers, there’s an upgrade that covers daring activities such as mountain climbing and parasailing.
The professional upgrade adds more reasons for reimbursement due to work related cancellation or interruption, and protection for professional equipment is available.
The Travel Max plan is the most extensive. You can cancel for business reasons, and there’s an upgrade that allows you to cancel for any reason up to two days before your scheduled departure.
This upgrade only applies to trip costs of $10,000 maximum, and you can get reimbursed for up to 75% of the trip cost.
It offers a substantial amount of coverage for emergency medical expenses and medical evacuation, and you also get lots of travel assistance and concierge services.
You may even get coverage for any delays in the sporting equipment you rent. Other plans from Travelex Insurance are for business travellers with a 30-day maximum trip length per covered trip, and a flight insurance policy that focuses on the flights.
- Vayama International Travel. This company is more known as a travel company. It aims to be a one-stop shop for travel needs, which is why they’re extending their services to travel insurance. They offer the usual terms for travel insurance, but the most notable benefit is the convenience of getting everything you need for your travel with just one company. You can book your flights, make your hotel reservations, and get your insurance, and Vayama can handle it all.
With the Vayama International Travel’s extensive contacts in the travel industry, you can get a lot of info from their 24-hour travel and legal assistance.
Travel Insured International with World Nomads
World Nomads insurance company has earned a stellar reputation since it started. Their insurance plans are very easy to understand, and the prices are reasonable.
They have three plans: the Worldwide Trip Protector Lite, Worldwide Trip Protector, and Worldwide Trip Protector Plus. The middle plan offers a very long list of reasons for trip cancellation and interruption, including a school year extension, attending childbirth, or a pre-existing medical condition.
The flight cancellation can return 100% of the trip cost or 150% of the trip cost for trip interruption. Emergency medical coverage and evacuation has a $1 million limit, and lost baggage and personal effects have a $1,000 limit.
Coverage also includes accident and sickness medical expense ($100,000), baggage delay, travel delay, missed connections, changed fees, and reimbursement of Miles or Rewards points. Pre-existing medical conditions are included too.
Coverage for children is included. With the Plus, you can cancel or interrupt your vacation for any reason, and you can get back 75% of the value of the unused trip cost. There’s also a $50,000 coverage limit on rental car damage.
Perhaps the only troubling aspect here is that there are no explicit discussions on the plans for sport activities, so you need to discuss this factor with the World Nomads representative before you purchase a plan. I
f you and your family are going skiing, bungee-jumping, or horse-riding, you need to know that any injury is covered beforehand. With all these options, you ought to get a good start.
Learning how to choose travel insurance is about knowing that bad things are always possible, and that’s why you need insurance on the first place. Think of the worst-case scenarios, and make sure you’re covered for any disastrous eventuality.