Why Travel Insurance Is So Important

Over the years, my experience both as a travel professional and as a frequent traveler myself has taught me you never really appreciate travel insurance until you need it.  I’ve seen first hand the benefits of travel insurance, which I’ll share in this article. The key to travel insurance, I’ve found, is to build it into your trip costs ahead of time so that you do not make decisions based on financial cost but rather on the peace of mind and your specific needs.  

Disclaimer: I am not a licensed insurance provider, so all opinions expressed are my own.  Travelers are responsible for reading the Description of Coverage for any travel insurance you wish to purchase and to read the definition of coverages/exclusions.  My examples here do not indicate guarantees of coverage for your specific situation. 

What is Travel Insurance?

Travel insurance is a type of insurance designed to protect your health and assets in the event something goes wrong during your adventures around the world.

Why do I personally recommend travel insurance? Here are tales from the field!

I always recommend travel insurance because I have personally experienced its benefits and seen the benefits for my clients.  It’s the type of thing you may never need, but when you need it you will be so glad you have it (like car insurance!)

• I’ve had an airline delay my baggage for 24 hours and I was able to receive reimbursement from the insurance company for the clothes and supplies I needed to buy.  I’ve also personally had travel insurance pay my hotel costs when I missed my flight in a connecting airport. 
  
• Last year I had a honeymoon couple whose flights were delayed due to weather/hurricanes and they got to their resort two days later.  Travel insurance paid for their airport hotels and also refunded them for the 2 nights they missed out  of their vacation. 
  
• A few years ago I had a family going to Ireland. One of their passengers broke their shoulder one week before departure. Travel insurance reimbursed him 100% for the cost of the trip as the doctor did not allow him to travel.  This was a $17,000 multi generational trip and everyone got their funds back!
  
• During the Covid-19 & corresponding travel ban crises in 2020, my clients with Cancel for Any Reason supplier insurance were able to get 100% refunds with no questions asked.  These were very expensive trips that would normally have been non-refundable if canceled so close to departure, but because they had the special insurance they had no problems requesting the cancellation.  With the emotional stress and disappointment of canceling a trip, don’t add financial stress to it as well!
  
• Some years ago, I had a client doing a self-drive trip in Europe. While they were already over there, a terrorist incident occurred in the city they were due to fly out of.   They changed their plans and drove to a different city and travel insurance paid for the flight change fees so that they could fly home from the 2^nd city and avoid the 1^st city entirely.
  
• Revising this article in 2021, I have to add that with the challenges of travel during the covid19 crisis it is also imperative to make sure you are adequately protected for medical emergencies or quarantine in a foreign country.  The insurances that my clients are purchasing for 2021  trips include coverage for hotels and meals if a traveler needs to medically quarantine in a foreign country if ordered by a physician.  They are also purchasing stand-alone Medical Evacuation insurances that will provide private medical charters to transport them back to a US hospital, even if they aren’t interested in baggage delay or other lighter benefits of insurance.  (Please read descriptions of coverage carefully or make sure you are purchasing the exact coverage you want.)

Here are my responses to the most common questions about travel insurance:

“Travel insurance seems really expensive and/or travel agents are just pushing it for financial gain.”

Real talk here – as a travel professional, it is incredibly stressful to telephone a client and tell them they are losing money when they choose to cancel.  When purchasing non refundable travel experiences, you are putting your entire financial investment at risk.   There is often nothing I can personally do to ‘force’ a hotel, airline, or cruise line to give you your money back even if there are extenuating circumstances.  Adding travel protection to your booking helps us all navigate emergencies when you realize that for whatever reason you just can’t go on that trip, or you need to cut your trip short.  

I would rather you purchase travel insurance/protection even if it’s not through me, because I take your financial and emotional investment extremely seriously.  I also don’t want to get a call that you’re stuck in a foreign country with mounting medical bills and need life-saving surgery and can’t afford to pay the hospital upfront!  

You don’t have to purchase insurance through your travel professional.  You can do it on your own if you prefer to do extra research. Here are some companies for you to investigate on your own. But, if you’re using a travel professional, ask them to send you a quote as certain insurances have additional coverages only for sale by industry professionals.

• Roam Right: https://www.roamright.com/
• Travel Insured: https://www.travelinsured.com/
• TravelEx:  https://www.travelexinsurance.com/
• Medjet: https://medjetassist.com/ *This is not an insurance, it provides you with medical and/or security transport back to the USA in case of emergency.
• insuremytrip.com or squaremouth.com – these aggregate sites will show you several options for you to compare.

Hint:  The insurances linked above will also have a landing page about their special Covid19 coverages.  Don’t assume what is / what isn’t covered, their FAQs are very helpful and may surprise you with some positive benefits!

Also, a word about costs – these vary according to your age and trip costs, so it’s not a one-size fits all.  For supplier insurance purchased directly from your travel provider (let’s say Delta Vacations) it will be a flat fee NOT based on age, so you can sometimes save money that way if you don’t fall in the best age category.  Travel insurance is often not as expensive as expected, depending on the type of trip.

“Why do I need insurance for baggage getting lost? The airlines are obligated to pay for my supplies!” NOPE. Not always – particularly if flying a foreign airline.  I have personally had my baggage delayed for 24 hours on a Latin America airline and they refused to offer any compensation.  Thanks to my travel insurance, it was wonderful having the financial freedom to run into a mall and buy anything we wanted (my policy will reimburse up to $200 per day) within reason and know we would be reimbursed, and to be able to change into new clothes after being in the same clothes for 24 hours.

“Why do I need delay and cancellation protection? The airlines are obligated to get me to where I’m going if it’s their fault.”

Not always (see above), and also you’re extremely limited if you just rely on the airlines’ goodwill.  And did you know, airlines aren’t obligated to reimburse you if it’s a weather-related delay?!

I’ve been on trips where my 7am departure turned into a 6pm reschedule and I would miss my connecting flights.  My travel insurance offered to search for additional flights for me and assist in finding alternate routes.  They also paid for my hotel overnight in Miami when I got stranded after missing a connection.  

The line to talk to the airlines was over an hour long if you wanted to force the airlines to pay for it!  I simply got in a taxi and went to my hotel and was reimbursed by my insurance.  (Note: always check your limits – in the hotel case above, I am reimbursed up to $150 per night so if I’d chosen to go over that amount I would have been responsible.)

“I know I’m definitely going on my trip so why would I want to protect against cancellation?”

If you don’t want to purchase cancellation insurance,  there are still insurances that will cover you after departure with robust medical insurance, assistant for trip interruptions like needing to fly home for an emergency, or flight delays.  At a minimum, you should always make sure you’re protected against medical emergencies while overseas – most people’s regular health insurance will not cover them at all if out of the country. 

Second of all,  we can all PLAN to go on a trip,  but an elderly family member may pass away unexpectedly,  world events such as terrorism or government unrest may make us uneasy about our travel plans, a travel tour company may declare bankruptcy, or we may fall ill at the last minute and receive doctor’s orders not to fly at all.  Or we could find ourselves in the middle of a pandemic… We just can’t predict the future. I think 2020 taught us all this valuable lesson! 

What are key questions to ask myself when searching for insurance?

• Are you looking for cancellation coverage for emergencies only (illness, death in the family) or do you need “cancel for any reason insurance” (bad hair day…or a pandemic)
• Do you want coverage for Cancel for Work Reasons (your boss tells you you can no longer go on vacation)?  Do you want to be covered if your travel supplier or airline goes out of business and stops answering your calls? 
• How much coverage do you want for emergency medical services?  Don’t skimp here – true medical emergencies are very costly.  Look for coverage around $500,000 to be sure. 
• Do you need pre-existing conditions covered?  Most insurances don’t cover pre-exisiting personal conditions unless purchased within a certain time frame of your deposit.  Make sure you review your insurance options as soon as possible after booking a trip.  All insurances have their own definition of pre-existing conditions, so as a general overview, this refers to your personal medical conditions that you’ve been treated for in the past 60-120 days (check with your specific supplier).

Things to consider – whether to buy it NOW or wait till right before departure 

Some travelers who have put down refundable deposits wait until just before departure to buy their insurance.  There are some instances where you should buy the insurance much earlier than this – up to 21 days after your first trip deposit for certain insurances, but others can be 14 days or less.

• Pre-Existing Conditions:  If you or a family member has a pre-existing health condition, most travel insurances will only cover this if you buy the insurance quite early,  soon after deposit.  If you do not purchase within this time frame, pre-existing conditions are not covered.  For example, let’s say you broke your ankle last week before making a deposit on the trip.    You have complications and an infection and in six months, the doctor recommends that you do not travel and should cancel your trip.  In the insurance’s eyes, this is a “pre existing condition” because you broke your leg before you made the reservation for the trip.  It’s possible they will not cover your cancellation fees.  *This varies from insurance. Every Description of Coverage will explain how they define Pre-Existing Conditions and when they are included/excluded. 
• Cancel for work reasons:  Some insurances will cover your cancellation fees if your employer says that you may not travel at the last minute.  This coverage often must be purchased almost immediately after your first trip deposit.  (There are specific ways this is phrased, so you must read the Description of Coverage to see the parameters.) 
• Supplier default – if an airline or tour partner goes out of business and does not honor their agreement with you, travel insurance often will cover these losses, but often the insurance must have been purchased within a specific timeframe.

How do I know what my travel insurance covers?

All travel insurances should offer a PDF download called “Description of Coverage”.  This is their Bible and is the legal document they will use to determine your coverage in case of a claim.  If it’s not written there, it’s likely not covered.  It’s extremely important to read the Description of Coverage to know what you’re buying. 

Can I use a credit card insurance?

Some credit cards have quite good travel insurance coverage as long as you’ve paid for the trip with that specific credit card.  You will need to look up your credit card benefits to check and you can compare them with an independent travel insurance quote to see which coverage you like better.  If pre-existing conditions are a concern then you will have to double check that the credit card insurance covers this as it is often excluded.  

Is travel insurance refundable?

No, 99% of the time, travel insurance is not refundable.  Most insurance companies will allow you to change the dates of your trip, however, if you need to move your trip to the following year. 

That was a lot of information to throw at you! I hope your biggest takeaway is that travel protection is something you should seriously consider adding to your vacations moving forward. During our consultant calls when we first start working together, I often bring this up and will quote it during my workflow. If you haven’t reached out yet, contact me today.