Travel Insurance: Eight Key Things You May Not Know

[Allianz Global Assistance]

How well do you know the facts about travel insurance? Here are eight of the questions we get the most:

1. What does travel insurance usually cover?

A general rule-of-thumb: insurance usually protects against unforeseen events that may cause you to cancel or disrupt your trip. Travel insurance can also provide protection and assistance for you (your health) and your personal belongings. That being said, travelers should read the specific policy so they can be sure of what is covered.

There are lots of different kinds of policies: you can get coverage just for the cost of your airline ticket, or comprehensive coverage that provides cancellation & interruption, baggage protection, delays, medical & dental, and emergency medical evacuation as well as emergency assistance.

Coverage you may want to consider includes:

- Protection for your belongings (lost or damaged baggage, baggage delay)
- Trip interruption and trip delay
- A missed connection
- Travel accident
- Car rental protection
- Supplier default/bankruptcy
- Access to a travel assistance hotline
- Emergency medical and dental assistance
- Emergency medical evacuation (including up-front payment)
- Pre-existing condition explanation and coverage

2. What is the main reason people use travel insurance?

The majority of people who file travel insurance claims do so because they have to cancel a trip for an unforeseen medical reason.

3. What about existing medical conditions?

Some travel insurance policies may cover existing medical conditions when you meet certain conditions. If you, a traveling companion or a close family member has an existing medical condition that may cause you to cancel your trip, check your policy to see if you have coverage and that you have met the conditions for that coverage.

4. When are you traveling?

If you are purchasing a trip far in advance, then you will probably want trip cancellation coverage. Make sure you are aware of the covered reasons for trip cancellation. If you are not concerned with trip cancellation because you're booking close to your departure date, check out policies that don't include trip cancellation, which may be less expensive.

5. Can I cancel my trip if I change my mind?

Many insurance policies do not provide coverage if you simply change your mind and decide not to travel. If a company offers such “all risk” coverage, there are typically exclusions, sometimes deductibles and often higher premiums.

6. Travel insurance vs. cruise protection

Many cruise lines offer trip protection that is not actually insurance. The cruise line may provide customers with cruise protection that provides them with a “credit” when they cancel for a covered reason. Most travelers prefer travel insurance because it reimburses in cash, not credits. Also, when you buy insurance offered by the supplier, like a cruise line, you typically aren’t covered if the travel supplier goes out of business before your trip.

Look for policies with the most comprehensive list of covered reasons for cancellation and interruption, including: jury duty or subpoena; FAA shutdowns; natural disasters, fire, flood or vandalism to your home; employer termination, traffic accidents en route to departure; natural disasters; terrorism; military duty; strikes; quarantine and more.

7. How much does travel insurance cost?

That depends on what type of plan you are buying. Most plans typically cost from 5% to 7% of the trip cost, depending on such things as the benefits, coverage levels, and traveler's age.

8. Won't my health insurance cover me while I am traveling?

Travelers should check with their health insurance provider to understand their coverage so you know what level of coverage you may need from travel insurance. When traveling internationally, many comprehensive travel insurance policies cover medical services and hospitalization abroad up to the limit of the policy and will guarantee payments to healthcare providers so that you don't have to pay significant sums upfront.

 

photos: IstockPhoto.com