Going on that vacation trip? Thinking about it makes you feel relaxed and happy and you think – “finally I’m going to be able to relax and unwind”. But just when you really start to relax you begin to have “what if” thoughts:
- What if one of my parents gets sick and I have to cancel?
- What if my 10 year old gets an ear infection the day before departure?
- What if I get laid off from work?
- What if I get into an accident while driving the rental car on the wrong side of the road?
- What if I get ill while on the trip and have to be rushed to the hospital?
- What if a hurricane hits?
There are thousands of what if’s. Many of them can be eliminated or minimized by buying travel insurance. However, with so many plans on the market and so much misinformation on the internet how can I find a plan that will provide me the best coverage for my needs at the most reasonable price?
Based on our extensive experience there are some simple steps to follow to find the right plan for your trip:
1. Conduct a review of your current insurance and your own tolerance for financial risk. Here are some basic areas to review;
- your current health insurance. Does it cover outside the USA. What are the limitations. Medicare doesn’t and many health insurance plans treat it as being out of network. Also with the new Affordable Health Care exchanges many plans limit coverage outside the home state. If your health insurance covers you on your trip will it pay for an “emergency medial evacuation” when your to sick or injured to travel as a regular passenger?
- your homeowners or tenants policy. Is it “all risk” or “named peril”? Does it cover your possessions off premise as it would on premise? How large is your deductible?
- credit cards – do any of your cards provide coverage? Many credit card offer travel coverage when you use your card for the travel payment. Make sure you check the limitations because many plans very specific limits on coverage; e.g., coverage for baggage and personal effects might be limited only to bags that are checked on airline flights where you used the card to buy the tickets. Likewise “rental car waiver” coverage might be limited to a specific number of days and if you’re over the maximum than you will probably be out of luck.
- review the refundability of your travel arrangements. If any or all of the arrangements are non-refundable will it cause a financial hardship if you were to lose that money if you had to cancel?
2. Once you’ve conducted your review you should have a pretty good idea of your needs and what to look for in a travel insurance plan. Stay focused on what is important to you. The most popular type of travel plans – referred to as “package plans” – contain many different coverages and it’s easy to lose focus.
3. Shop for travel insurance. Travel insurance is not standardized and there are very few minimum requirements. Just because a coverage may be called “trip cancellation” doesn’t mean that all plans cover the same thing. Most current advice is to avoid buying coverage offered directly by the travel supplier; plans are limited and in many cases don’t always contain coverages that are underwritten by licensed insurance companies. It is not uncommon that there can be over a 400% difference in cost for plans offered for the same trip by different companies. Why pay more if the lower priced plan will solve your needs?
4..Buy travel insurance early. Most travel insurance plans offer “time sensitive benefits” at no additional charge as an inducement to get you to buy the insurance early. By early they usually mean within a week or two following your first trip payment date. These extra benefits start diminishing the longer you wait so it pays to buy early. Especially if you need coverage for pre-existing medical conditions.
5. Make sure you meet all of the conditions to qualify for pre-existing medical conditions. A common misunderstanding is that all you have to do is buy the coverage within the required time period however, most plans also require that you’re physically fit to travel on the day you buy the insurance and that you insure your trip for it’s full pre-paid value. Failure to meet all conditions can cause heart break at the time of a claim. For that reason always round your trip cost up and don’t cut corners by leaving out taxes and fees.
Bottom line is that you should always shop for travel insurance based on your needs and you should always compare plans before buying.