Angie's LIST Guide to
Travel Insurance

If you want protection against unexpected delays, cancellations or emergencies that could ruin your vacation or business trip, consider buying travel insurance.
 

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travel insurance
Travel insurance can help protect you from the expense associated with a canceled flight, among other things. (Photo courtesy of ©Thinkstock)
 
 

Why would I want travel insurance?

Like any other insurance, travel insurance provides financial protection for unforeseen events, such medical emergencies, natural disasters, your airline or travel provider ceasing to operate, or lost, damaged or stolen luggage. Some insurance plans also cover missed airline connections, trip delays or cancellations, and certain terrorist incidents.

Travel insurance will never cover losses due to war or civil unrest or mental or nervous disorders, including fear and anxiety. Also, it won’t cover trips cancelled for non-medical reasons, unless you buy a plan that allows you to cancel for any reason.

Travel Insurance eligibility

If you want travel insurance, buy it before your trip begins. Some insurers allow you to purchase a plan the day of the trip. However, waiting means you risk that something will happen that affects your trip before the policy takes effect. Your policy will state the date your coverage begins and ends. Make sure you review your policy to learn the effective coverage dates.  

Related: 10 tips from travel agents for your next vacation 

You can insure any pleasure or business trip, for you and family members, as long as it takes you away and has fixed travel dates. Some insurers require the travelers insured by the policy to be U.S. citizens or residents. 

Read the fine print. Travel insurers have many rules about what the policy covers and what part of your trip is covered, based on when you made your initial deposit and final payment. The rules apply whether you paid for the trip with cash, a credit card or used frequent-flier miles.

For example, the insurer may deny a claim for a cruise that was purchased and later rescheduled, unless you can show documentation that you completely canceled the first cruise and 100 percent of your money was refunded to your credit card or in the form of a check made payable to you. The documentation must accompany the claim.

Also, some insurers or insurance policies will not cover last-minute travel additions, such as payment for a hotel room or port excursion, once the bulk of the trip is paid for.

Travel medical coverage

While the Patient Protection and Affordable Care Act forbids health insurers from denying coverage based on pre-existing conditions, many travel insurance policies exclude coverage for pre-existing medical conditions. Travel insurers that do offer medical coverage may deny claims if the condition, no matter how minor, manifested itself, became acute or exhibited symptoms the insurer determines you should have sought medical attention for during a given time period. Travel insurers use a “look-back” period to determine if the medical expense is covered by the policy. The look-back period may go back as far as 180 days before the policy took effect.  

If you buy medical insurance, make sure you know if your policy provides primary or secondary coverage. Primary coverage means the insurer is responsible for the bills up to the amount stated in the policy from the first medical bill generated.  Many secondary coverage policies assume you have primary coverage and will pay only after your primary insurer pays its share. Secondary coverage usually will pay any deductible, co-pay and out-of-pocket expense you incur, up to the allowed limit. However, secondary coverage requires that you pay the medical care expense first, and then submit a claim for reimbursement.

Travel insurance costs

Several factors go into determining the price of travel insurance, including the length of the trip, the age of the travelers, their pre-existing conditions and any add-on options, such as the ability to cancel your trip for any reason. You can purchase an all-inclusive policy, which often covers emergency medical expenses, emergency evaluation, repatriation, tour cancellation and trip interruption. You can also choose to only cover parts of your trip, such as the airfare or the cost of a cruise. Expect to pay from 5 percent to 10 percent of the cost of the trip for travel insuranece.

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