Should You Buy Travel Insurance?

[Jan115 1,064]

Marcelo Almeida doesn't typically buy travel insurance, though he practically lives on the road.

But the thought of his daughter being stranded in Chicago on Christmas Eve while flying home to Coppell, Texas, last year, led him to change his mind.

The trip went smoothly. But Almeida, a strategic account executive for a global education company, was glad for the protection — just in case.

"Insurance is one of those things that you feel neutral if you got it and didn't have to use it," Almeida says, "but regret deeply if you didn't, and needed it."

With all that can go wrong on a trip — you wake up too sick to fly or lose your passport along the Champs-Elysees — travel insurance can come in handy.

Depending on the policy, travelers can be directed to the nearest hotel when their flight is canceled, get a referral to a local attorney while overseas or be evacuated to a hospital back home if they become ill.

But whether you need insurance depends on a range of factors, from the cost of the vacation to the time of year you're taking off.

"I think it really depends on how expensive your trip is and what you can afford to lose," says George Hobica, founder of Airfarewatchdog.com". I'd also consider it when you know the weather's going to be bad. If you're going to Bermuda during hurricane season, after June, I'd be more likely to buy it than I would in April."

It's also worth considering if the traveler is worried about a member of their party getting sick or getting injured on a vacation that involves skiing, biking or some other sport, says Jeanne Salvatore, spokeswoman for the Insurance Information Institute, which educates the public about policies.

If such a mishap occurs, she says, "You're going to be really, really happy you have that coverage."

WHAT IS COVERED

A basic package generally covers the non-refundable costs of a trip up to the particular policy's limits, has medical coverage and offers assistance for various emergencies.

It most often kicks in for matters beyond the traveler's control: from illness, to the airline canceling a flight because of a storm, to your missing a flight because you got in an accident on the way to the airport.

"Some policies cover if you have to return to work or serve jury duty," says Linda Kundell, spokeswoman for the U.S. Travel Insurance Association.

But beware, she warns: "Travel-insurance policies will not cover reckless behavior. If you have an accident because you're drunk, chances are you won't be covered. So whoever buys the policy has to engage in reasonable behaviors."

Insurance is different from the waiver that may be offered by a cruise line, for instance, which will usually give a traveler a credit to be used for a future trip rather than a refund.

"You won't lose your money, but you're not going to be reimbursed, either," Kundell says, adding that the waiver also may have restrictions, such as a requirement that the rescheduled trip take place within a year. "Travel insurance will just reimburse you, and you don't have to sail again if you don't want to."

Waivers also may not factor in additional expenses, such as paying an extra day of parking or housing a pet, says David Anderson, director of products for Protect Your Bubble, a travel-insurance company. "All those things would be covered under a blanket policy," he says.

Travel insurance tends to average 4% to 8% of the total cost of the trip, with the price varying according to the traveler's age. For frequent flier Barry Maher, the cost is too steep.

"It's overpriced," says Maher, a business consultant and speaker, who adds that insurance companies are "betting ... that over time, you'll pay more than you're going to get."

Just last year, Maher says, he had a flight that he had to reschedule four times, ultimately costing him $600.

"People might argue I could buy a lot of travel insurance for that," he says. "But based on the number of trips I've taken, I would have paid a lot more" than $600 for insurance coverage.

Denise Gavino, meanwhile, is glad that she decided to buy travel insurance for a trip to Orlando two years ago.

"For some reason during the checkout process I agreed to purchasing it," says Gavino, a flight attendant who lives in Houston. "Wow, was I happy. The evening before the trip, my son complained about not feeling well." It turned out that he had the flu, and the trip had to be postponed.

"Delta and their insurance carrier were very helpful," she says, "and we received a full refund on our tickets."

THIRD-PARTY COVERAGE

Travelers can buy insurance from an airline or a cruise company. But Kundell says those policies may not be as comprehensive as packages purchased directly from an insurance carrier.

Hobica of Airfarewatchdog.com adds that if the cruise line or carrier went out of business, the coverage they offered would also disappear.

"It's best to get third-party insurance" from companies like Allianz Global Assistance or Travel Guard, he says. Policies can also be bought from travel agents and some resorts.

If a traveler wants to be covered no matter the circumstances, there are more expensive policies that would allow them to cancel for any reason.

The cost can be up to 40% higher than a typical policy, but if a traveler became fearful of going to their destination — not usually a valid claim on most policies — they could bow out of the trip and get their money back, Kundell says.

Whatever type of policy you buy, and wherever you buy it from, do your homework. Read the fine print and ask the provider plenty of questions about what reasons are considered acceptable for making a claim. A flight delay might have to last a certain number of hours, for instance, for a policy to kick in, Hobica says.

Buyers can find other general questions to ask by clicking onto the U.S. Travel Insurance Association's website, www.ustia.org.

Travelers also should keep records, from the hotel receipt showing where they stayed when their flight was canceled, to a note from the doctor that confirms they were too sick to travel.

"If the airline cancels a flight because of weather, the airline will provide a statement for you," Kundell says. "You do need to have proof of anything that you claim."

Salvatore of the Insurance Information Institute also recommends checking that the insurance provider is licensed in the state where the buyer lives, in case you have problems and need a place to appeal.

Source: USA Today (April 3, 2013)

Photo Credit: www.kootation.com

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[coloradocruisers 125]

I won't debate Mr. Maher on the price; but we always buy the travel insurance.

[cruisingcats 30]

Should we buy travel insurance beyond the insurance from the cruise line?

[PegasusGM 3]

You only need to wind up losing your passports, etc in a foreign country to make you glad you have insurance. Saved my behind after our Greek Isles trip.

[PegasusGM 3]

You only need to wind up losing your passports, etc in a foreign country to make you glad you have insurance. Saved my behind after our Greek Isles trip.

[Jan115 1,064]

Should we buy travel insurance beyond the insurance from the cruise line?

Good question, Falina. Most cruise lines cover only those parts of the trip that you purchase directly from them. So if you book your airfare separately from your cruise fare, or if you purchase a non-refundable pre or post-cruise hotel deal on line, you won’t be covered for that travel segment under most cruise line policies and would need to purchase additional coverage for those additional items separate of the cruise line.

A better idea would be to purchase a plan directly from your travel agent covering every non-refundable aspect of your trip. In the event that you didn't use an agent, search for a policy through an independent insurance comparison site such as insuremytrip.com or squaremouth.com.

Hope this helps.

[cruisingcats 30]

Should we buy travel insurance beyond the insurance from the cruise line?

Good question, Falina. Most cruise lines cover only those parts of the trip that you purchase directly from them. So if you book your airfare separately from your cruise fare, or if you purchase a non-refundable pre or post-cruise hotel deal on line, you won’t be covered for that travel segment under most cruise line policies and would need to purchase additional coverage for those additional items separate of the cruise line.

A better idea would be to purchase a plan directly from your travel agent covering every non-refundable aspect of your trip. In the event that you didn't use an agent, search for a policy through an independent insurance comparison site such as insuremytrip.com or squaremouth.com.

Hope this helps.

Thanks Jan this does help. I am going to go over what the cruise line insurance says it covers and check those sites you mentioned.

[jacketwatch 168]

We always get travel insurance from insure my trip dot com. You enter your particulars and get a large menu of plans from many insurance companies like AIG, John Hancock, Amer. Express and others. Each has a range of plans. The higher the cost the more it includes in the plan. We used AE last yr. at a cost of $300.00 to insure a trip costing $5800.00. We were forced to buy new airline tickets from Madrid to Chicago when our return was cancelled by super storm Sandy and UA could not get us back for 6 more days. This extra fare, about $2300.00' was fully reimbursed by AE.

[WeCruiseToo 399]

We always have third party travel insurance to cover our entire trip.

It took care of everything for us when all flights were canceled due to a volcano in Iceland and we had to take trains across half of Europe.

When our luggage didn’t make the same flights we did, the insurance was there.

Mom and Dad (in their 70s) have used travel insurance several times to offset expensive medical issues both on ship and ashore.

We travel a lot and have only had to use the insurance a few times, but it has still saved us far more money than we have spent purchasing the insurance!

[DebbieandJerry 243]

The older I get, the more I buy travel insurance. My biggest "rule" is, can I afford to walk away from xx amount of money if I can't take the trip? My answer is always NO. The cost of insurance is minimal compared to the cost of not being able to take a vacation and losing xx amount.

The few times that we had to use it, it was worth the $125 or so per person.