There is a lot of confusion surrounding insurance plans offered by cruise lines. Many of the plans seem comprehensive, however, when you examine them closely you will probably find one or more reasons why consumer advocates recommend against buying directly from the cruise line and instead recommend that you buy from a third party.
When reviewing a plan offered by a cruise line look for:
- cancellation or penalty waiver: it is the portion of the coverage that applies to pre-departure cancellations. It might be listed under many names other than insurance - because in many cases it is not insurance, but rather the cruise line funding the benefit. Instead of providing you with a full refund, they will provide you with a credit voucher for a future cruise that usually has to be used within a year or two.
- low amounts of medical coverage: some cruise plans offer a low amount of medical coverage which might be inadequate for your trip and your own circumstances. Remember health insurance might have limitations and restrictions once you leave your service area and Medicare and Medicaid don't cover you at all once you've left the USA.
- low amounts of medical evacuation coverage: medical evacuations can be very expensive. Many cruise plans offer lower than adequate amounts of coverage.
- high coverage cost: the lack of competition encourages the cruise lines to price their products high. Most plans have a "community" rate meaning that it's one rate for all passengers regardless of age. This works very well if you're over 80 but if your younger you'll probably be able to find better coverage at a lower cost.
- lack of default or bankruptcy coverage: coverage offered through the cruise line does not provide protection if they were to go bankrupt. While this might seem to be a remote possibility remember that cruise lines have gone bankrupt in the past leaving thousands of passengers without a cruise and without a refund.
- won't insure for trips not booked through them: pre and post tours and independent airfare aren't covered under cruise line plans.
Package travel insurance plans are ideal for cruises and plans can be found at good prices which are usually lower than charged by the cruise lines.
If you're going on an Oceania Cruises program than you'll want to visit our page Oceania Travel Protection Program vs travel insurance.