Recently Consumer Reports published an article, Travel Insurance: Why you rarely need it and in my opinion they missed the mark entirely and they end up with some misleading and erroneous generalities.
The most misleading statement made in the article is that:
“In most cases,… the insurance merely duplicates coverage that they already have”.
This statement would be true if one were talking about Flight Accidental Death, medical coverage, or baggage insurance but those are usually not the coverages that are of primary concern to most travelers. But it is evident that Consumer Reports doesn’t understand the marketplace because if they did they would be highlighting the coverages that most travelers are concerned about:
- trip cancellation,
- trip interruption,
- travel delay, and
- emergency medical evacuation coverage.
These later coverages are the primary reasons why travelers buy travel insurance and if you check with the majority of travelers you’ll see that these coverages are not duplicated in personal insurance plans nor are they provided as free benefits under most credit cards.
I’ve yet to see where someone’s health insurance plan will provide for trip cancellation or interruption losses or where they will cover for an emergency medical evacuation. Also, I sincerely doubt that many travelers have an American Express Platinum Card to take advantage of the “free” travel insurance that is provided and which might duplicate a standard travel insurance policy.
I also take exception to the comment that “sophisticated travelers don’t buy travel insurance”. Just the opposite is true. Many client’s who purchase travel insurance are very sophisticated travelers who have analyzed their financial risks and have made informed decisions to offset their risks by buying travel insurance. As a matter of fact travelers are becoming more and more sophisticated and are comparing travel insurance plans to make sure they find a plan that fits their financial needs.
I’ve come to expect much better reporting from Consumer Reports but in this case it appears they have not done their homework and that they don’t understand the marketplace.