Fortunately, few vacations turn out as badly as the Costa Concordia cruise, which capsized off the Tuscan shoreline recently. But plenty of things can and do go wrong every day for travelers and vacationers. Plans change and trips get canceled. People get sick or have medical emergencies while traveling. Baggage goes missing. And, yes, sometimes there are even accidental deaths. All of which got us to thinking to buy travel insurance. If you’re thinking about buying it for an upcoming vacation or business trip, here’s what you need to know to buy travel insurance.
First, check the policies you already have. For example, your homeowner’s insurance may cover lost baggage or a stolen camera. Your health insurance probably will take care of emergency medical services when you’re away from home and out of network. Note, however, the Medicare generally does not pay for medical services received outside the U.S. If you’re renting a car, your auto policy or even the credit card you use may take care of that coverage. If you’re not sure, call your agent or insurer to see what is and isn’t covered.
There are a variety of coverage options ranging from basic to comprehensive. Depending on your needs, it can be purchased for a single trip, multiple trips or on an annual basis. The Insurance Information Institute divides available options into four broad categories:
- Trip cancellation or trip interruption insurance returns your money or a portion of it if plans change. That could include you deciding not to take the trip or the tour operator canceling it for lack of interest or because the tour company has gone belly up. Read the fine print for conditions and exclusions.
- Insurance for loss or damage of personal belongs pays you if your baggage or personal effects (camera, wallet, etc.) are lost, stolen or ruined.
- Emergency medical aide covers the cost of health care and emergency evacuation if you become sick or are injured while traveling outside of the U.S.
- Accidental death pays the designated beneficiary a lump sum of cash if you or a covered family member dies while traveling.
If you’re going to spend the money on travel insurance, make sure it covers all the eventualities. Your travel policy should protect your health, cover trip cancellation or interruption, emergency dental and medical services including hospitalization and transportation, accidents, stolen or delayed baggage, travel schedule delays and missed transfers, and accidental death. There should be a 24-hour phone number you call with any questions or claims. Test it a couple of times before you leave to make sure there’s a human being on the other end.
You should also be on the lookout for travel insurance scams. Stick to reputable firms and check consumer sites or the BBB for reviews and complaints. If you’re still not sure, contact your state’s insurance commission to see if the insurer is licensed and the policy offered is legal. Be wary of anything touted as a travel protection plan; it probably won’t offer the same level of coverage as travel insurance. Is the insurer backed by a regulated underwriter? You can find out by running the insurer’s name