Whether you have spent hours planning or you’re just looking for the quickest flight out, you are often asked one last question before you finalize your purchase: “Would you like insurance with that?” You’ve spent so much money and life tends to remain fairly unpredictable. The security of travel insurance is comforting and in the grand scheme of things, it seems reasonably priced. It only makes sense to ensure you get your money back, right?
Unfortunately, there is not a clear-cut answer, but there are some important things you should know before you buy. First and foremost, understand that travel insurance policies are often riddled with exclusions and limits. It’s important that you read the travel insurance policy before purchase. Understanding the policy may make your decision for you. Often your fears for cancellation are not covered under the insurance policy.
So what, exactly, are your fears? Are you afraid of illness preventing your trip, losing your baggage, a travel emergency, or maybe you just want to cancel your trip? You may already be covered. Before purchasing travel insurance, check these common policies you may already have:
- Your Credit Card. Many credit card companies offer some form of travel reimbursement. You will have to check what your card specifically covers, so make sure you read, read, read. Several cards offer coverage from trip cancellation to lost baggage, some even offer coverage for medical emergencies and emergency assistance. Most frequently you will find that your credit card offers coverage for rental vehicles. Of course, it only covers transactions you make with your card, so you would have to purchase your travel arrangements with your credit card.
- Medical Insurance. Some medical policies offer coverage if you are traveling. Check your current insurance policy to see if you are covered and check for limits and exclusions. If you are not covered abroad, many insurance companies offer short term or long term travel coverage that may be more specific to your needs.
- Airline or Hotel. In cases of illness, death of a travel companion or immediate family member, or jury duty, many airlines and hotels will refund your purchase. Check the refund policy of your airline and hotel before booking. If an airline loses or damages your luggage and you file a claim, you are provided one of two forms of protection and compensations. First, the U.S. Department of Transportation requires for domestic flights the airline compensate you up to $3,300 for lost or damaged baggage. The second is for international travelers, the Montreal Convention is based on the exchange rate, and may fluctuate, but currently requires airlines to compensate you for your lost or stolen baggage up to $1,578.64. Remember that after 21 days “delayed” luggage is considered lost. For more information about your consumer rights with airlines, check out the U.S. Department of Transportation’s Fly-Rights: A Consumer Guide to Air Travel.
- Homeowners or Renters Insurance. If you already have a policy, check the details to see if your luggage or the valuables in your luggage are covered. Many policies cover your possession, despite where you travel.
If you find that you are still in need of additional insurance, be sure to check various policies available to you. Research various companies and read their reviews. Always ask for a sample policy and if you contact a sales agent about specific concerns, make sure they can reference their answers in the policy. Last is an important lesson for agreeing to any purchase…always read the fine print.
*Special thanks to Karie for writing assistance.