Some Travel Insurance Benefits
1. Overseas emergency medical assistance: 24-hour coverage for medical evacuations, ambulances, funeral arrangements and more.
2. Overseas emergency medical and hospital costs: If you need to go to the hospital suddenly due to injury or illness, you are covered for hospitalizations, surgery and emergency dental treatment.
3. Lodging and travel expenses: If you are ill or injured and unable to get home, travel insurance will cover your unforeseen additional lodging and travel costs.
4. Family emergency: You are covered for your unexpected travel expenses if your close relative or the person you are traveling with dies unexpectedly or is disabled or injured and needs to be hospitalized. *Learn more about family emergencies here.
5. Coverage for your travel companion: If your travel companion is no longer able to continue your vacation due to injury or illness, travel insurance will reimburse for any unforeseen lodging or travel expenses.
6. Resuming the trip: If you need to return home due to a death in the family or a serious illness requiring hospitalization, and are a close family member, your flights will be covered to get you home. *
7. Hospital cash allowance: An amount you will receive per day if you are hospitalized overseas for more than 2 days.
8. Accidental death: If you die within 12 months of your trip due to an injury you suffered while on vacation, a death benefit is provided.
9. Permanent disability: If you lose your sight or any of your extremities while on vacation, you will receive payment for disability during at least 12 months after you return home.
10. Loss of income: If you get injured during your trip and are no longer able to work, you will be paid a loss of income benefit for a specified period of time.
11. Credit card fraud and replacement: You will be reimbursed for any costs to replace your credit cards, or for any fraudulent use, in the event of loss or theft on your trip.
12. Stolen cash, traveler’s checks and travel documents: You will be reimbursed for any costs to replace your passport, travel documents or traveler’s checks if they get lost or stolen on your trip. And if your cash is stolen, you are covered.
Your non-refundable travel expenses exceed your credit card benefits
While your credit card can reimburse up to $5,000 in unreimbursed expenses, your trip may cost thousands of dollars more. In addition to supplemental coverage, you may also receive a large reimbursement for purchases that your credit card is unable to fully reimburse.
More flexible reimbursement policies
Travel insurance generally has more lenient reimbursement policies than travel provider policies. Although you still need to submit supporting documentation in most cases, the small cost of purchasing a policy is worth the potential payout.
Some reasons you may wish to purchase travel insurance include:
- Cancelling for any reason
- Unexpected job requirements
- Military deployment
- Personal or family illness
- Legal divorce or separation
- Travel provider going bankrupt
- Once again, each insurance provider has different cancellation policies and notification requirements. Allianz is one of the most flexible with 26 different reasons for cancelling coverage.
Since the nature of insurance is to protect against the unprotected, you might only be covered if an unexpected event occurs. If it looks like you have a 50/50 chance of making the trip for personal or business reasons, it is probably best to skip the trip altogether. Travel insurance can reimburse you for your purchases, but you might not want to take advantage of that opportunity.
Times you should not purchase travel insurance
While travel insurance provides additional reassurance, it is not always a wise purchase. Here are some instances where you should not purchase travel insurance.
The cost of your trip is relatively low
If you are only driving five hours to visit distant relatives, you probably do not need travel insurance. The reason is that you may only lose a couple of hundred dollars in non-refundable expenses instead of several thousand. Losing money is never any fun, but purchasing insurance for every little trip may cost more than the payment benefits when you finally file a claim.
If your only expenses are airfare and hotel rooms, the carrier may reimburse or offer credit. Reimbursement for travel insurance only occurs if the travel provider does not offer reimbursement first.
Types of Travel Insurance Coverage
Travel insurance may include many specific types of coverage, but most of them fall into five main categories:
Trip cancellation or trip interruption insurance.
Trip cancellation is when something happens that prevents you from going on a previously planned trip, such as an unforeseen medical issue. Trip interruption is when you are halfway through your trip and something happens to interrupt it, such as a medical emergency of a family member at home or a workers’ strike at an airport. Generally, you will be reimbursed only for part of the trip that you did not complete. Terrorist threats fall under this umbrella, but some plans only pay if you are scheduled to arrive within a certain number of days before the incident occurs.
Medical insurance. Before purchasing travel medical coverage, check with your regular health insurance company to see what type of coverage you have when you travel. Many American insurance companies continue to cover you overseas. Medicare does not provide travel coverage. Even if your regular health insurer provides primary coverage, you might want to purchase supplemental (secondary) coverage in order to cover for deductibles and any unusual expenses that your regular insurance carrier does not cover. Emergency medical coverage can be purchased as primary or secondary coverage with benefit limits per person from $15,000 to $250,000 or more. Please note that the U.S. State Department routinely issues travel advisories for certain high-risk countries.
If you are traveling to these areas, your travel insurance will not be honored, unless you purchase supplemental coverage.
Evacuation insurance. These policies cover the cost of transporting you to a place where you may receive the necessary and proper treatment in the event of a medical emergency. Evacuation costs are generally not covered by your regular home health insurance. Non-medical evacuation coverage arranges for transportation from a dangerous location to a safer place during times of civil or political unrest.
Loss of luggage and personal items. This coverage provides reimbursement for lost, stolen or damage luggage and other personal items. Generally, it is provided for your entire trip, not just flight-related activities. If you are carrying items worth more than $1,000, such as a laptop computer or camera, it is best to list them on a schedule as part of your commercial or homeowner’s policy.
Life insurance. There are three main types of travel life insurance: Accidental death. Only a few companies offer this general coverage for an entire trip. Air flight accident. This only covers the flight portion of your trip.
Common carrier. This coverage pays in the event of death or dismemberment while traveling on any form of public transportation.