Does travel insurance have too many exceptions?

Question: A friend and I purchased a tour from Friendly Planet to Ecuador last July. We booked a round-trip flight on American Airlines from Dallas to Miami to arrive in time to connect to the LAN flight to Quito, Ecuador.

We purchased flight insurance with Access America Insurance for the super-saver flights from Dallas to Miami. In February I received an email from Friendly Planet saying that the tour had been canceled due to too few participants. I was given the choice to receive a refund or to schedule another tour later in the year. I decided to reschedule.

However, Access America denied the claim I made to cover the costs of changing the American Airlines flights, which was $137 for each of us.

I had spoken to two representatives from Access America explaining what had occurred, and both encouraged me to file the claim since it was not my fault that the trip was canceled. The process was time-consuming.

I have written a letter to Access America asking for a second review. I think Access America insurance is bogus at best since the trip was interrupted because it was never started. What is the purpose of insurance if not to cover the unexpected? — Catherine Markland, Whitney, Texas

Answer: If your insurance policy covered a canceled tour, then Access America should have paid up.

But did it? I checked with the insurance company, and rescheduling a trip because of a lack of participation in a tour isn’t covered. I agree with you that when you buy insurance, you’re left with the impression that you would be protected if something goes wrong on your vacation. But you have to read the fine print.

Most travel insurance policies cover specific situations described in their terms. There are a number of common events, such as illness or injury to an insured, a traveling companion or close family member, plus a list of other health, transportation, accommodation, political and work circumstances, that are covered reasons for canceling or interrupting a trip.

It appears you purchased your policy to cover your airline ticket, through your airline’s site. I’m a little dubious of the insurance offered through airlines, because they can be extremely restrictive. (I’ve heard insurance insiders joke that you have to die in a plane crash or lose a limb in order to make a successful claim, but I’m sure that’s an exaggeration.)

Insurance purchased through an airline is often an afterthought — and optional purchase with your airline ticket. Travel insurance should never be an afterthought. You’re much better off shopping around for the right policy than clicking a button when you’re booking a ticket and then assuming you’ll be covered.

I contacted Access America on your behalf. It reviewed your case and ruled that your tour cancellation wasn’t covered. I’m sorry.

Update: Some of you will recognize this story — it’s based on the very first “case dismissed” post I wrote last year. About a month after I covered Markland’s unsuccessful claim, Friendly Planet decided to reimburse her for her flight, after all.

(Photo: o5com/Flickr)

Christopher Elliott

Christopher Elliott is an author, journalist and consumer advocate. You can read more about him on his personal website or contact him at . Got a question or comment? You can post it on the new forum.

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  • Michael__K

    If so, I acknowledge that’s a big improvement.  When did they start doing that (particularly the “and fare” part)?  

    I’ve definitely seen otherwise when I’ve booked my own trips (including very recently on Delta).

  • TonyA_says

    Since the  24HR cancellation LAW went in effect last 24/26JAN 2012.

    Also, people can buy travel insurance after they buy a ticket but before they travel.

    The only important thing is they know WHAT APPLIES to them, otherwise they could be wasting money.

    There is NO SUBSTITUTE to reading the policy. I do because I don’t want to waste my money.

  • TonyA_says

    Nope, NY is tough. You cannot even be an AGENT selling travel insurance here (in NY State) without registration. I like it. Maybe there is less riffraff sellers.

  • TonyA_says

    Ahhh… this article might have been placed to show how nice Friendly Planet is for paying for the OP’s ticket penalties. After all they (tour operator) were responsible for cancelling the tour (not the insurance company).

    Note their post about Chris Elliott in their blog yesterday. Nice video.

    As Chris said “that’s what makes Travel beautiful, anything can happen”.
    That ANYTHING can include your tour getting cancelled because there were not enough participants.

  • TonyA_says

    An insurance policy with only 7 bullet points ??? The legal profession will go on strike!

  • Michael__K

    There’s a difference between pay now (cancel  w/i 24 hrs) and hold/guarantee (pay w/i 24 hrs).

    Many airlines apparently comply by doing the former… which means you’re led to believe that you’d  have to cancel and re-ticket from scratch   if you decide w/i 24 hrs that you want that  insurance option after all.  

    You and I might know that the policy is still available directly from the insurer (at the same price or better!), but that is not disclosed to the customer AFAICT.

  • TonyA_says

    The OP could easily buy the travel insurance from the company
    that sold her the tour. Here’s the owner of the company appearing with
    Chris Elliott giving her #1 advice – BUY TRAVEL INSURANCE.

  • TonyA_says

    Bodega, to the trained eye (of a travel agent) something does not look right with this case. Why is it that only the DFW-MIA ticket had an insurance problem while the MIA-UIO (Quito, Ecuador) apparently did not? Why, was this not ticketed as one itinerary? If so, if the tour was cancelled by the operator, then the OP would not have had any problem (since air would have been part of the tour).

    A research on fares suggests why there was a problem. The tour price includes a fare FROM MIAMI. But if you look at the fare structure of LAN, MIA-UIO can be as cheap at $199 (before tax) R/T. The problem is that DFW-UIO is at least $762 (before tax) from LAN. There is a $563 fare difference per pax! So I think a money-saving move was done by the OP. They decided to buy their own DFW-MIA domestic tickets which can be as low as $302 (before tax) from AA. So in order to save about $250+ per passenger, they did a VERY RISKY MOVE. They UNLINKED their tickets. And, maybe they thought that buying cheap insurance would fix the potential problems. WRONG !!!

    This is not an insurance failure. This is a stupid decision to UNLINK tickets to get to an iffy tour.

  • AUSSIEtraveller

    It’s really, REALLY SIMPLE.

    The cheaper the insurance the more restrictions !!!

    & read the policy especially the exclusions. Get the impression, people are so lazy, they don’t even bother reading the basic.

    If in doubt, ask the insurance company BEFORE paying, although, in Australia, there’s a cooling of period with insurance, where they have to refund within a certain time frame, if you want to cancel policy for ANY reason.

    Best thing is to purchase your travel insurance through a travel agent, who knows the basic details & sells insurance very often, so knows the ins & outs.

    Caveat Emptor !!

  • bodega3

    It seems to me that they handled their own domestic ticket which usually isn’t something a tour company will cover if they cancel their tour within their stated cancel period.  It also appears that they took out the insurance only on the DFW to MIA ticket.  Change fees are $150, so how do they get $137 per person to submit to the insurance company when they rebooked for the new tour?  Was the new flight less expensive and the residual applied to the change fee?  This isn’t allowed any longer with most carriers.

  • bodega3

    So this article is a shill?

  • TonyA_says

    I noticed that, too, when I read the AA rules this morning. Couldn’t figure out the $137 they noted when $150 is the reissue fee. Maybe this rule did that:


    The tour source lists add on fares (from other US cities) on its website so I assume they could have ticketed the whole thing from DFW. But as I said in my post above the THROUGH fare DFW-UIO was expensive so they probably bought a separate AA domestic ticket from DFW-MIA.

    This case is simply not an insurance company fail. It is an Operator Fail.

  • TonyA_says

    In the second video, the owner of the tour company (appearing with Chris again) said her #1 suggestion to travelers is to buy travel insurance.

    So how in the world can Access America be guilty here. The owner herself SELLS ACCESS AMERICA in their website!

  • Bernard Rappoport

    I remember when a hurricane hit Grand Cayman.  My friend’s accommodations were decimated.  He wanted to cancel…but RBC Insurance tried to say that since the flights were still operating, TFB…go and sleep on the beach.  Only when he threatened to move his company’s banking from them did they reluctantly pay up.  He would have been better off going to an ER, cough and puke, and get a doctor’s note.  Insurance companies encourage dishonesty since they weasle out of legitimate concerns for cancellation

  • Sadie_Cee

    I couldn’t possibly agree with you more. 

  • Sadie_Cee

    The message above was in reply to lost_in_travel.   

  • Sadie_Cee

    Someone wrote here once at a time when the topic of travel insurance was being dissected, that the difference in cost between the ‘cancel for any reason’ policies and the standard travel/medical insurance policies is not as great as one might assume. 
    Having read all these posts here today and from my own small knowledge of  travel insurance, these ‘cancel for any reason’ policies would seem to be the only ones worth buying.  To clarify this, let me add that choosing these policies would be the better way to go for older travellers, people taking longer cruises and definitely for the risk-averse. 
    (Just learned last week that even though doctors on shipboard are hired by the cruise line, they are considered independent operators and the cruise line is not liable for their actions!)  I was amazed.

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  • Lindabator

    And THAT is the problem here.  That’s why we are licensed to sell third party insurance (we sell Travel Guard), which is FAR more comprehsive, and which covers you for a lot more. 

  • Lindabator

    AMEN!  I just had a client come back from a trip, and he had some jewelry stolen.  He filed with his homeowner’s but there was still the $500 deductible.  He only told me later, and I told him to submit a claim to TravelGuard, and include the info about the decuctible — 2 weeks later, he got a check for the $500.00.  So yes, it DOES work – but with a reputable company, and knowing what is and what is not covered! 

  • Lindabator

    Frankly, I think they are trying to build a new reputation, as the old one wasn’t so hot.

  • Lindabator

    OR for a travel agent, who can help you wade through those questions, and ensure you get EXACTLY what you need.  :)

  • Lindabator

    AMEN!!!   I either ONLY book guaranteed departures, private tours, or tour only UNTIL they are guaranteed, and then do the air.  And the client is FULLY aware of that when I go over everything with them.

  • ExplorationTravMag

    Best suggestion yet.  On my site, I did an article for travelers and I make the strong suggestion – if a trip’s going to be complicated, get a travel agent.  If insurance is involved, get a travel agent.

    My feeling is, if it takes more than a few minutes online, get a travel agent.  If you have to make a phone call to navigate the website, get a travel agent.

    People don’t realize travel agents are paid on commission, thus, there is either no or low cost to use them.

  • Lindabator

    Exactly!  AND you have an advocate – I go to bat for my clients, and can say I strive to take care of them above and beyone their expecations.  Thanks!

  • ExplorationTravMag

    That was a point I made in my article – if you’re standing at an airline counter in a foreign country, a few well-placed International calls or fast e-mails can get it fixed vs. dealing with the travel conglomerate sites where you might or might not get a human who knows what they’re doing.

  • FriendlyPlanetTravel

    It is absolutely correct that Catherine Markland and her
    travel companion booked a tour to Ecuador with us and that the departure had to
    be cancelled due to insufficient numbers of participants. This doesn’t happen
    to us very often, but when it does, we give our travelers several options.
    First, we offer to switch them to another departure, which Catherine and her
    companion accepted. However, if she didn’t wish to switch, we would have
    refunded her in full for all the tour payments made to us.


    Catherine made us aware of the fees charged by American
    Airlines to change her domestic flights to her new travel dates, and we
    promptly refunded the amount of the change fees of $137 per person. In
    addition, we send both travelers a coupon for $50 off any future tour we offer,
    as a gesture of goodwill.


    Peggy Goldman

    President, Friendly Planet Travel

  • John McGlade

    There are other little known provisions of these insurance policies. As an example, they cover trip cancellation for the death of a close family member but that relative must reside in the USA. Even the best travel insurance companies don’t spell out the exclusions very clearly.