Your flight has been canceled. Your cruise ship isn’t sailing. You’re sick and can’t travel. But your travel company won’t issue you a refund for your fares.
Many of our readers will respond to your story with: “You should have purchased travel insurance.”
Are they right?
If you’re like me, it may never have occurred to you that travel insurance exists, much less that you might benefit from purchasing a policy, until one of three things happens:
- You come across “travel insurance” in the course of planning a big trip. There’s a link on a travel website, it’s mentioned in cruise or tour literature, or your travel agent mentions it. You think to yourself, “Hmm. Not a bad idea to be covered!”
- You meet with misfortune that prevents you from continuing — or maybe even starting — your trip.
- You’ve read the myriad stories on our site of travelers who could have benefited from travel insurance coverage — and seen the comments promoting its purchase. Note: Our site does not endorse the purchase of any commercial product — including travel insurance.
If you purchase travel insurance, what exactly are you getting for your premiums?
As we discussed in last week’s series, travel insurance typically covers various types of losses that may be incurred while traveling, such as
- medical expenses,
- accidental death and dismemberment,
- illness or death of immediate family members,
- trip cancellations and interruptions,
- lost, stolen, damaged or delayed luggage and replacement costs,
- weather delays, and
missed flight connections.
Note: This is not an exhaustive list.
Be aware that travel insurance companies hold insureds to the letter of their coverage limits and exclusions when reimbursing claims. Just like with any other type of insurance claim, the burden of proof of coverage is on the insured.
There are some common exclusions, such as pre-existing medical conditions (although additional coverage for such conditions may be available if purchased within 24 to 48 hours of making a deposit), elective surgery or medical treatment, mental illness, war, terrorism, controlled substance or alcohol abuse, and financial insolvency of travel companies. Each travel insurer has its own coverage and exclusions rules.
Some travel insurance policies offer “cancel for any reason” coverage. This type of coverage, as the name suggests, reimburses costs for canceled trips, regardless of the reason. But the insurers may not fully reimburse claims.
Travel insurance can be purchased through travel agents and brokers, as well as directly from travel insurers. Some travel companies, such as cruise lines and tour companies, offer travel insurance as part of packaged cruises and tours; these policies may exclude delays and cancellations resulting from problems created by the companies. It is also available to premier-level credit card holders from companies such as Chase and American Express.
Whether it makes sense to purchase a policy, as well as how much and what types of coverage, depend on various factors. For example, our blog commenters would advise cruise passengers and international travelers not to leave home without a travel insurance policy that will reimburse the above costs.
Whether or not you can get coverage, how extensive it is, and within what limits can depend on factors such as your age, lifestyle and destination. Travel insurers may deeply restrict or refuse to cover trips to certain parts of the world that are considered too expensive or dangerous, such as Iraq or Antarctica, or charge significantly higher premiums to cover travel to such areas. Depending on how frequently you travel or how close together in time your trips are scheduled, a multitrip or annual policy, as opposed to a single-trip policy for each trip, may make more sense for you.
Since no one policy fits all situations, we make no recommendations as to the purchase of any specific type of travel insurance policy or any providers of travel insurance.
We do advise all purchasers of travel insurance to read policies carefully and understand coverage limits and exclusions, as well as all other conditions related to any individual policy before purchasing it. That includes all information on how to make claims and how long it should take any insurer to reimburse them.
And even when your policy clearly covers your situation and you have the documentation to prove it, it’s still up to the company to issue reimbursements for your claims to you. If they don’t, our website contains executive contact information for several travel insurance companies. And our advocates stand by to help you.