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Should I Buy Travel Insurance?

Aug 17, 2016 | by Aon

 

Five Questions to Ask Before Booking Your Next Trip

Often an overlooked investment until the unexpected happens, travel protection offers insurance and other benefits and services designed to give travelers peace of mind and financial reimbursement against the unanticipated costs of travel. But not every vacation requires a high level of travel protection. So how can you determine just how much coverage – if any – you really need?

“It doesn’t have to be costly, but sometimes it’s worth adding a few additional dollars to your travel budget to ensure you’ve got the safety of travel protection,” said Beth Godlin, president, Aon Affinity, Travel Practice. “No one wants their well-laid plans interrupted or cancelled, but life happens and travelers appreciate knowing they have options and support. Unfortunately, there’s still plenty of confusion about what travel protection can cover.”

Consider these five questions to evaluate your travel protection options:

1.  What if an unforeseen issue forces me to cancel my trip or return home early? How much of my trip investment would be non-refundable and what extra expenses should I expect?

One of the primary benefits of travel protection plans is reimbursement of non-refundable expenses if you are forced to cancel a trip for a covered reason like an injury or unexpected illness that requires medical attention.

But you still face financial risks even after your vacation has begun. You could become ill during the trip, have to return home early and incur extra expenses to change flights not to mention reimbursement of the unused trip portion. This scenario, called “trip interruption,” is a common benefit of travel protection.

In fact, the U.S. Travel Insurance Association found that programs including trip cancellation/interruption benefits accounted for more than 85 percent of travel protection purchased in 2014.

2.   Is sickness the only reason I can cancel and still be reimbursed?

No. Many plans also provide trip cancellation for other unforeseen reasons such as being involved in an accident en-route to your trip departure or losing a job.

Some travel protection plans even include the ability to cancel for any reason at all and still provide some form of reimbursement of the non-refundable trip costs. As with all coverage, terms vary, so ask questions and read the details of your specific protection plan.

3.  How will medical expenses be handled in the event of a minor accident, sickness or an emergency while I’m away?

No one wants to get sick or have an accident, especially during a dream vacation, but it happens. It could be a minor issue that’s resolved by a visit to the cruise ship doctor, or it could be more severe and require medical attention or even an emergency evacuation. For these reasons, you -- particularly if heading abroad or to a remote location -- need to understand if your current medical insurance would cover any care or even emergency evacuation required during the trip, so you can decide whether to obtain supplementary coverage.

These types of medical benefits are often included in travel protection plans, especially those customized by the supplier based on their destinations and passenger composition. For example, a leading cruise line that sails internationally or a major online travel agency will likely have a plan designed for the type of travel booked.

4.  What about the goods traveling with me to, from and during my trip? How are they covered?

If a remote control can go missing for days at home, what’s to prevent the loss of baggage going 1,000 miles through two airports and onto a ship? In the first six months of 2015, the U.S. Department of Transportation recorded more than 1 million mishandled baggage reports filed with domestic airlines.

Baggage delays, loss, damage and theft are risks of the road but many travel protection plans include benefits that range from providing a few dollars to pick up some clothes for the night to reimbursing travelers thousands of dollars for more significant losses.

Of course, airlines do provide some recourse for bags lost or damaged during flight, but travel protection will typically cover belongings throughout the course of the entire vacation. Your homeowners or renters coverage can also apply in certain specific circumstances, but the loss may be lower than the deductible and it may be less than desirable to submit a claim.

5.  Is the expense of travel insurance really worth it for me?

Consider the total investment made for your trip relative to the nominal cost to protect it with travel protection.

Big ticket vacations like an extended cruise to exotic ports, a luxury land tour, or a multi-city international trip are prime for travel protection. After all, the non-refundable amount for these types of trips can be significant, they may be paid for far in advance, and there may be more opportunity for things to go wrong.

But should you protect that short-haul flight that costs $400? While the risk of losing hard earned money might not be life-changing, many of us would prefer to have some level of protection. Some plans are available to purchase with just a click during booking and can cost less than $20. Of course that type of plan may not have the same benefits as those offered for more exotic vacations.

One of the significant advantages of protection plans developed exclusively for, and sponsored through, travel suppliers such as online travel agencies, cruise lines and tour operators is that they are usually available for easy purchase during travel booking. Those plans are also designed for the type of travel provided by those companies so the products are generally better suited than those available from third party companies.

All vacations have their own nuances to consider, so be sure to ask plenty of questions of any travel insurance provider and read your specific policy thoroughly to help ensure the investment matches both trip and the traveler. Sometimes a relatively small investment can have be a significant payoff for your safety and peace of mind.



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