It pays to compare travel insurance

March 31st, 2015

To say it pays to compare travel insurance may seem like a cliché, but in truth, tailoring your coverage to your specific needs–and potential needs–can save you a lot of hardship and money under worst case scenarios.

Commonly, travelers purchase the first insurance plan offered by their supplier, trusting they’re adequately covered to arrive safely and healthy, and if, per chance, they have to canceled their trip, they’re satisfied that their policy covers them for that as well. Chances are not good that the first plan offered is the best, nor is it cost effective in the long run.

The most common policy offered falls under the category of “Cancellation Protection” or “Cancellation Waiver.” These policies are frequently offered by tour operators, airlines and cruise lines and consist of both traditional insurance and non-traditional; the latter is comprised of self-insurance by the travel supplier. This, as one might understand, is generally discouraged by most consumer advocates, primarily because the traveler may suffer a double loss if their travel supplier goes under; loss of the trip and loss of the coverage.

Most important is the knowledge that these “one size fits all” policies are grossly inadequate for those covered by Medicare of Medicaid who travel out of the country. In the event of an illness or catastrophic circumstance, the $10,000-$25,000 of medical coverage provided to the traveler may prove to be far too little, costing the traveler a great deal more out-of-pocket expense.

What’s the solution? Compare the policies offered–which can range from economy, standard and deluxe–by comparing both your immediate needs as well as your potential needs. It’s important to realize that even with traditional travel insurance, coverage may vary from both company-to-company, but also within the same company, and prices can vary by more than 300% for the same trip.

Needless to say, it’s crucial that travelers shop around before deciding on coverage. Equally important is for the traveler to consider the limits of their health, home and/or auto insurance, as well as how much is available via credit cards. If the results are less than satisfactory for the trip on which one is about to embark, the solution is to find the best travel insurance plan that fills the gaps, in terms of coverage.

The short answer is that the traveler’s coverage should not begin and end with trip cancellation coverage alone. Assuring that one has adequate medical coverage is equally as important. Once you have this information, the final step is to concentrate on selecting the right plan—that fits your needs–at the best price. Not knowing your risk and settling for the first plan offered, regardless of what may appear as an immediate saving, might actually cost the traveler more in the end.

70 years ago today!

February 23rd, 2015

70 years ago today, February 23, 1945, one of the most iconic photographs of WWII was taken of 5 Marines and one Corpsman raising the US flag on Mt. Suribachi during the battle for Iwo Jima.  The battle was one of the most costly in the history of the Marine Corp – a battle where almost 4 out of 10 Americans were killed or wounded.

To the Marines and their Naval Corpsmen who fought the battle and to all Marines  past, present, and future – Semper Fi!

Travel Insurance forecasts for 2015; the four most likely issues facing travelers

February 10th, 2015

While crystal balls are always subject to change, my speculation as to the four most likely issues facing travelers in 2015 are based on 46 years of travel insurance experience. Some of the conditions listed below have held forefront positions for eons and probably always will, but QuoteWright can help take the mystery out of travel insurance with its new QuoteWright ratings system, based on a value of 0 to 100.

We assign values based on how a specific coverage compares with similar coverage among the different plans we offer.  So if you’re trying to decide which travel insurance plan has the best coverage for “weather conditions” or “pre-existing medical conditions,” let our 2015 Buyers Guide help lead the way.

Issue number one: Despite the start of a new year, pre-existing medical conditions—an issue with many years of history—will again quite likely be the number one travel insurance issue for 2015. It’s an old chestnut, to be sure, but one that has consistently been the number one “gotcha” within the travel insurance industry. And unfortunately, if travelers don’t ask the right questions of their travel insurance agent before purchasing a plan, they’re frequently faced with surprises after the fact.

There is good news, however, in that most travel insurance plans cover pre-existing conditions—if you qualify. The way it works is if a plan offers a “waiver of pre-existing conditions,” the traveler must meet three conditions in order to be eligible:

  • Coverage must be purchased within 10-30 days following your first trip payment.
  • The traveler must be physically able to travel on the day they purchase insurance.
  • Travelers must insure their trip cost to value.

Issue number two: Unfortunately, among the top issues facing travelers in this day and age is that of terrorism. It’s a sign of the times and as such, it will play an important role in 2015, and possibly beyond, as has been witnessed by the recent heinous act of terror in Paris, one of the world’s greatest cities. With groups like Al Qaeda posting instructions on how to make a bomb designed for airline targets—whether real or merely designed to create economic chaos—it’s a wise policy to purchase travel insurance that covers cancellations or interruptions caused by a terrorist event.

Issue number three: Abnormal weather conditions causing delays and/or cancellations are always a distinct possibility. Not all travel insurance plans cover cancellations, interruptions, or delays caused by weather in the same way. If the threat of bad weather might create havoc during your trip, it’s a good idea to compare travel insurance plans carefully in order to fit your travel plans.

Issue number four: Widespread diseases, such as Ebola, have always presented a challenge for the travel insurance industry, and 2015 is not an exception. There is no doubt that insurance companies will continue to restrict coverage for epidemics, either by adding exclusions to their plans or by refusing to insure travelers going to countries where there is an ongoing epidemic.

If you plan to travel in 2015, consider the top four issues that may determine exactly which and how much insurance coverage is appropriate for your travel.

What is a pre-existing condition?

February 7th, 2015

Pre-existing Medical ConditionsOur most frequently asked question is:  What is a pre-existing condition?  Here is a short audio file that I put together to help you understand this important issue.  The text file is listed below.

Hi, this is John Cook, President of QuoteWright.com and today I would like to talk about the most frequently asked travel insurance question: “What is considered a pre-existing medical condition.”

It’s a common question because all travel insurance policies contain an exclusion for pre-existing medical conditions and, as required by law, travel insurance policies must define exactly what they consider is a pre-existing condition. Since medical reasons are the number one cause of trip cancellations and statistically, almost 30% of all claims maybe due to a pre-existing condition this becomes an important issue.

In general, a pre-existing condition is considered to be any medical condition where you or a family member has received care or treatment or have had symptoms that would cause an average person to seek care and treatment within a period of time immediately prior to the effective date of coverage. The effective date of coverage for plans with trip cancellation coverage is usually the day after the policy was purchased. The period of time that a company looks back varies by plan and can be as few as 60 days and as great as 180 days, with 180 days being the most common.

Most plans have an exception to the exclusion for controlled conditions that are being treated with a prescribed drug, as long as the prescription and the underlying condition remain totally unchanged during the look back period. If, both the condition and medication have remained totally unchanged during the look back period than that would be exempt from the exclusion.

One thing that is often misunderstood when it comes to the pre-existing exclusion is whether or not it applies to non-traveling family members. Plans are split on this with some plans only applying the exclusion to traveling family members and the others applying it to all members whether traveling or not.

One way to eliminate the complexities of this exclusion is to buy a plan that offers a waiver of pre-existing medical conditions which will prohibit the insurance company from denying a claim using the pre-existing exclusion. Many plans offer a “waiver” as an inducement to try to get you to buy the insurance early in your trip planning but that is a subject for another article.

At QuoteWright we believe that the most powerful consumer is one who is informed.

Flight Insurance – is it worth it?

February 4th, 2015

In the wake of the recent TransAsia plane crash in Taiwan the question comes to mind of whether or not “flight accidental death coverage” is worthwhile?

Statistically, flying on a commercial airline is one of the safest forms of travel.  It’s been reported that the odds of being killed in a plane accident is 1 in 11,000,000.

How does that relate to buying “flight accidental death” insurance?  Most insurance professionals will tell you that you shouldn’t buy “flight accident” coverage but instead you should have adequate life insurance that will cover you 24/7.

There is some confusion concerning whether flight insurance is “life insurance” and you can see why by viewing a prior article that I wrote a couple of years ago:  Flight Insurance – what is it?.

Unlike many recommendations made by insurance professionals that don’t understand travel insurance I have to agree with this one – life insurance is the better option.

The economics of “flight accidental death insurance”  are also a good indication of value.   You can buy a flight accidental death policy that provides $100,000 of principal sum coverage for $14 which might seem reasonable however, back in the day, when I worked for a large insurance company, the net rate for $100,000 of flight insurance was just less than $ .10 – with a payout rate that low it’s not worthwhile.

However there will always be travelers who feel more secure by buying flight accident insurance.  I remember an executive at that large insurance company that would visit me every time he had to fly on business.  I once asked him why he bought the flight insurance before every trip when he knew the statistics as well as I did.  His answer was more emotional than logical because he told me that he felt safer buying the insurance.

Just goes to show you that buying insurance is a personal choice.