Travel insurance can reimburse you for certain financial losses incurred while traveling, typically as a result of unforeseen circumstances, such as a flight delay or emergency medical treatment. However, not everything is covered, so it’s essential to know the ins and outs of your travel insurance policy before you leave on your trip.
Learn more: Travel insurance: What it covers, costs, and how to choose the right policy
In its most basic sense, travel insurance will pay you money if something goes wrong with your travel plans. This doesn’t mean you’ll get paid for any little mishap, as it depends on your policy and whether the mishap is covered, but you can be covered in situations that might otherwise cost you thousands of dollars.
For example, if you’re on vacation in another country and have to visit the local emergency room after tripping and breaking your wrist, your policy may cover the hospital costs.
If it’s a covered reason under your policy, you would submit a claim with your insurance provider, including any required documentation, such as hospital bills.
Learn more: Best travel credit cards
Specific travel insurance coverage varies by policy, depending on the provider and plan you choose. The terms and conditions can also vary by policy, but here are some common types of travel insurance coverage (note that names can vary by provider):
-
Auto rental coverage: Provides reimbursement for rental car theft and collision damage.
-
Baggage insurance: Provides reimbursement for lost, delayed, damaged, or stolen luggage. You may also be entitled to reimbursement from an airline or other responsible party, depending on the situation.
-
Emergency evacuation and transportation coverage: Covers necessary emergency medical evacuation and transportation while traveling.
-
Emergency medical and dental coverage: Covers eligible expenses if you become sick or accidentally injured while traveling.
-
Travel accident insurance: Pays a set amount for covered travel accidents, typically involving a covered loss, such as loss of sight or hearing, or the loss of an appendage.
-
Travel delay coverage: Reimburses you for reasonable expenses as a result of a covered travel delay, such as a flight delay.
-
Trip cancellation insurance: Reimburses you for non-refundable and prepaid expenses in the event you have to cancel your trip for a covered reason. This coverage typically applies before you leave on your trip.
-
Trip interruption insurance: Reimburses you for non-refundable and prepaid expenses in the event you have to interrupt your trip for a covered reason. This coverage typically applies while you’re on your trip.
You get sick before your trip and can’t travel
If you have an illness that prevents you from traveling, you should be in the clear to get reimbursement from your travel insurance policy for non-refundable and prepaid bookings you’ve already made.
Applicable coverage:
Things to keep in mind:
-
You may need to consult with a doctor and submit their recommendation not to travel as part of the claims process.
-
Trip cancellation coverage typically only applies if you haven’t yet left on your trip.
If you decide to cancel your trip because you feel like a particular destination isn’t safe, you may not be covered by your travel insurance, though it depends on your policy.
Applicable coverage:
Things to keep in mind:
-
Many travel insurance policies won’t reimburse you for non-refundable expenses if you decide not to travel because of your personal feelings or general safety concerns.
-
You may be eligible for reimbursement if there’s a covered reason regarding safety, such as a government-mandated evacuation of your trip destination or a terrorist event happening nearby.
-
CFAR insurance can reimburse you for a percentage of your non-refundable expenses for essentially any reason you decide to cancel your trip.
If your phone or another personal and electronic device is stolen while traveling, you may be covered by travel insurance or one of your credit card benefits. You typically have to provide documentation, such as a police report, to your provider during the claims process to receive reimbursement for stolen items.
Applicable coverage:
-
Baggage, personal items, or device insurance
-
Credit card purchase protection
-
Credit card cell phone protection
Things to keep in mind:
-
It depends on your policy, but many travel insurance providers offer coverage for baggage and personal effects, or something with a similar name.
-
If you have cell phone protection through a travel credit card, you typically have to pay your cell phone bill with that card to receive the protection benefit.
-
Credit card purchase protection only covers new purchases, so it wouldn’t apply if you’ve had your phone for a while.
Learn more: How credit card travel insurance works
You’re injured while traveling and have to visit a hospital
You’re typically covered if you require emergency medical or dental treatment for a covered injury or illness while traveling.
Applicable coverage:
Things to keep in mind:
-
Emergency medical and dental insurance typically covers sudden and unexpected illnesses, as well as injuries or medical conditions that need immediate treatment.
-
You may not be covered if the illness or medical condition is a result of a preexisting condition.
Flight delays and cancellations are one of the most commonly associated risks of traveling, and likely one of the reasons many people purchase travel insurance. Depending on the situation, you may be covered by your policy.
Applicable coverage:
Things to keep in mind:
-
This coverage typically applies only to covered reasons, such as your airline or a natural disaster causing the delay. You may also be covered if your travel documents are lost or stolen.
-
There’s often a minimum delay required before your coverage kicks in. For example, six hours or more is usually a safe bet, but it depends on your policy.
-
Depending on your policy, you may have a daily limit on the amount you can receive in reimbursement.
-
Preexisting medical conditions: In many cases, expenses arising from preexisting medical conditions are excluded.
-
Known or foreseeable events: A foreseeable event could include a hurricane heading toward your vacation destination. If you still choose to travel, and your trip is affected in any way by the hurricane, you likely wouldn’t be covered because it was a foreseeable outcome.
-
Changing your mind: Unless you have CFAR insurance or a covered event occurs, you can’t use trip cancellation or interruption insurance to cancel or end your trip.
-
Being afraid to travel: Similar to changing your mind, you can’t cancel or end a trip and expect reimbursement if you have safety concerns unless those concerns align with a covered reason.
-
High-risk activities and adventure sports: Many policies exclude high-risk sports and activities from their general coverage, but it may be possible to add this coverage as a rider or add-on policy.
-
Epidemics and pandemics: Unless your policy specifically states that it covers epidemics and pandemics, then these known events are likely excluded.
It depends on your policy, but travel insurance generally doesn’t cover preexisting medical conditions, high-risk activities and adventure sports, or simply changing your mind. However, you may be able to include add-ons for these specific situations or purchase a policy that lets you cancel for any reason.
Travel insurance pays out for covered occurrences with properly submitted claims. This could include canceling your trip for a medical reason, receiving reimbursement for lost or damaged luggage, and getting reimbursed for emergency medical attention in another country.
What’s the difference between basic and comprehensive travel insurance?
Comprehensive travel insurance typically offers more types of coverage and higher coverage limits. For example, a basic policy may include $200,000 of emergency evacuation and repatriation coverage, while a more comprehensive plan may include up to $1 million in the same coverage.
The biggest disadvantage is that it’s an additional cost on top of your standard trip expenses, such as flights and hotel stays. Depending on the policy, travel insurance could cost around 4% to 10% of your total trip’s price. For a trip that costs $10,000, that means paying around $400 to $1,000 for travel insurance.
In addition, many insurance policies have loads of fine print that you have to be aware of. If you don’t understand the terms and conditions or the claims process, you may fail in your attempt to receive reimbursement, even if it’s for a covered reason.
Source link
