Travel Insurance Benefits
Created by FindLaw's team of legal writers and editors | Last reviewed June 20, 2016
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So, you have booked your flight, made your hotel reservations, packed your luggage, and hired the neighbor to dog-sit. What's next? Have you considered travel insurance? Do you know the benefits of travel insurance? This article will give you a brief overview of travel insurance benefits to help you decide whether or not you need it.
Whether it's health insurance, homeowners insurance, or car insurance, we buy insurance to cover us if and when life's unexpected events happen. Travel insurance is no different. Its job is to reimburse you for the costs of unexpected troubles while you are traveling. It typically includes cancellations, trip interruptions, and illness and injury.
Below is a list of common travel insurance benefits:
Trip cancellation and trip interruption
Often sold as one package, trip cancellation and trip interruption are perhaps the two most important benefits of travel insurance, because they cover losses that other types of insurance do not; most people have health insurance and many homeowners insurance policies cover lost luggage.
You are covered by trip cancellation before you embark on your travels. In the event you have to cancel your trip, this coverage reimburses you for pre-paid, non-refundable expenses such as your plane or train ticket and hotel rooms.
Be sure to read the policy language carefully. You are usually only covered if the cancellation is due to an unforeseen incident that affects you, any of your fellow travelers, or a close family member. This "unforeseen" language prevents you from recovering due to chronic illnesses, pregnancies, or injuries sustainable during dangerous activities, as these are all considered foreseeable incidentsthings you could have predicted might happen. Additionally, "close family member" language probably does not cover your partner unless you are married. So, if your unmarried partner gets sick before you leave, this will not be an incident covered by the policy. Be sure to read the language carefully, and if there is any language you are unsure about, ask an insurance agent to define it for you. Know what is covered before you buy the insurance.
Oftentimes political unrest and terrorism are excluded. Other policies include them. Be sure to check the policy language.
You should also be clear on how your policy defines when your trip actually starts, because that is when your cancellation coverage ends. For example, if your policy defines your trip as beginning the moment you leave your home, then a car accident on the way to the airport probably will not be covered. On the other hand, if your policy defines your trip as beginning once you've checked into the airport, then you would still be covered should you have an accident on the way to the airport.
While trip cancellation insurance covers you before your trip begins, trip interruption covers you during your trip. If you fall ill or become injured, your plane incurs mechanical errors, or any other unforeseen event cuts your trip short, trip interruption will reimburse you for your costs due to that unforeseen event. Typically, this is used to pay for expenses of going home early or catching up to your original itinerary after a delay. However, some policies even cover unused, prepaid expenses, such as the hotel room you never made it to. Trip cancellation sometimes also covers additional living expenses caused by these delays.
Most medical transportation is also covered. For example, if you are injured while hiking and must be airlifted to the hospital, this policy would cover the helicopter cost. Remember, however, that this coverage is only for unforeseen incidents. So, any chronic illnesses you may have are not covered. If your tendonitis becomes crippling during your rock-climbing excursion, the policy probably won't cover your medical transportation.
A few trip interruption policies cover you in the unlikely event of your death, such as handling your remains. Again, be sure not to rely on this if you have a pre-existing condition, as you may not be covered. If you want to take extra precautions, ask your agent about this coverage.
Health insurance benefits abroad
If you plan on traveling abroad, be sure to check your medical insurance policy, as many have restrictions on traveling abroad or may not cover you at all. Policies that do cover medical expenses abroad often require you to obtain certain paperwork from the foreign medical personnel. Just be sure to read over your policy in its entirety, and ask your insurance agent if you have any questions or concerns before you go. If you find that your health insurance does not cover medical expenses abroad, look into buying travel insurance that does cover such expenses.
Additionally, travel insurance does offer accidental death and dismemberment policies, but, like other medical emergencies, these costs are covered under most regular health insurance policies.
Other travel insurance benefits
As mentioned, most people are covered by other types of insurance, such as medical insurance or homeowners insurance, for any other unforeseen events. There are other types of policies that are available, such as travel accident insurance or lost baggage insurance, but these policies usually do not cover as much as your personal health insurance policy, your homeowners insurance, or your renters insurance, and so are probably unnecessary. Just beware of exclusions in all of your insurance policies, for example, pre-existing conditions that may flair up during your travels, or certain limitations on baggage contents, as most insurance policies, whether travel or medical, have exclusions or restrictions.
Top five tips when shopping for travel insurance
- If you plan to engage in dangerous activity, like mountain-climbing or skydiving, check to see if the policy covers it.
- Ensure you have enough coverage, especially if you're carrying a lot of expensive equipment. Make your coverage match its worth. For example, if your laptop is worth upwards of $1,000, but you only buy coverage for $500, the insurance may not even be worth it. On the flipside, if your laptop is ten years old and is your only major expensive item, think twice before buying an expensive policy to insure it.
- Inquire about any of your pre-existing conditions, and be honest. The insurance company can find out later if your condition was pre-existing and they can sue you for reimbursement and even fraud.
- Take care of where you are going and your belongings and keep in mind the policy's exclusions such as war, policyholder's extreme carelessness, or self-inflicted injuries.
- Be sure that you're covered for the full duration of your trip, from the time you leave your front door, until the time your return to your home. This is especially important when flying internationally, as some people, confused by the different time zones, make the mistake of ending their coverage too soon.
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