Most people - especially those of us who are younger - don't think about travel insurance much. Personally, when I travel domestically, I assume other layers of protection will cover me including car insurance, health insurance, and credit card protection. However, for larger trips such as going on a cruise during the winter while living in Chicago I chose to get travel insurance. In those situations, my primary consideration was having inclement weather causing delays and missing the boat or that a hurricane might impact the cruise itself. With our trip next week where we'll be sailing with Viking Cruises the situation was a bit different. The chance of a blizzard in San Diego or a hurricane in Switzerland causing us not to reach our boat would be pretty unlikely. I WAS going to roll the odds since I perceived the risk to be low. After all, spending a few hundred dollars to insure the trip didn't seem necessary.
When You Gamble Chance Are You Will Lose ...
During a conversation with CSA Travel Protection a few weeks ago though, they offered to walk me through their product and sponsor me to share my thoughts if I was interested in purchasing a policy from them at a discount. I decided to take that opportunity and learn more about why travel insurance was important. What I learned really helped me better understand why travel insurance was an important for more than just "cancelation risk" and questions to ask to ensure you get the policy that is right for you. Ultimately, I purchased the "Custom Luxe" plan from them because it was affordable and provided great coverage for the things I was concerned with.
Heather and I weren't too worried about the trip getting canceled. Once I looked at all the different other travel protection coverage though, it started to make sense. Considering I was going to be traveling to a different continent and traveling through different countries things like health coverage, legal advice, and protection in case our bags got lost were very important.
As you consider purchasing travel insurance, here are some questions that you should ask ...
What Travel Insurance Features Are Important To You?
For me, the main features that were important included:
- Lost or damaged bags
- Trip interruption and Delay
- "Getting Hurt or Sick" Outside the US
- Relatives Emergency Health Situations and needing to return home early
In reality, the main concern was what would happen if I slipped and fell on some icy streets and sprained an ankle or worse and needed to go to a hospital. We have health insurance that covers me in the United States, but while traveling to other countries that plan might not cover us like it does back home. With the plan I selected, both Heather and I have $250,000 in Medical / Dental coverage as well as a $1,000,000 should we need to be transported somewhere - including an emergency flight back to the US. The plan also will cover us if something happens to a close relative such as a parent or child passing away and us needing to return home early.
Those are all real situations that you might not think about initially since "you" might be young and healthy.
Because our concern was not canceling the trip itself, I placed a relatively low insured value compared to the total overall cost of the trip. This allowed me to still get the benefits I listed above, but your "cancellation and interruption" benefits will be reduced. For my policy, they are scaled based on the total insured value at 100% for cancellation and 150% for interruption, so it's really up to you to determine your risk tolerance while maintaining the other benefits.
What are the Limits and Excesses on Your Policy?
Similar to you deductible for health insurance, most travel insurance policies also have conditions on what they will pay back on a claim. For instance - if the excess is $100 and you claim $300, the policy may only pay $200. CSA's policies were nice and straight forward to understand without having to worry about that. However, it's important to consider that in the plan I purchased it is calculated based on the "Actual Cash Value" and that means that for items without receipts, "payment of loss will be calculated based on 75% of the Actual Cash Value at the tip of loss".
What Activities are Covered?
I'm not expecting any activities beyond walking around awesome medieval towns or at most hiking up a road to a castle, but if your plans include sports such as biking, skiing, sky diving etc. it's important to consider this in your policy. Many policies will exclude those activities from your medical coverage policies.
What About Pre-Existing Conditions?
Some plans will simply not cover you if there are pre-existing conditions. Others, such as CSA can provide a waiver based on various conditions or adjust the rate so that you can be covered.
What Other Travel Services Are Offered?
While each travel insurance provider is going to be somewhat different, I liked the fact that CSA Travel Protection also included features such as 24-Hour Emergency Assistance as well as "On Demand Medical Care" with ZERO out of pocket coverage for minor issues like a rash or sprained ankle (up to $1,000). They also offer Identity Theft Protection, Legal Assistance, Concierge Services, and can help if for some reason something happens and you need to reach an American consulate or embassy.
Which Countries and Regions are Covered?
There world is an ever changing place and so it's important that you check to see what regions and countries are covered. For instance, while Cuba is now a destination that Americans can travel to, most insurance companies don't cover travel there yet.
What Are Your Specific Insurance Cancellation Policies?
Each provider is different, but I really liked the fact that with CSA Travel Protection, they provide a 10-day refund period if you have not departed on your trip or made a claim.
How Will Travel Insurance Claims be Processed?
Some companies you will find outsource the claims processing to a different organization. However, one of the things that I liked about CSA was that they process claims in-house so you are actually dealing with "them" and not just an agent representing someone.
Should You Buy Travel Insurance Through an Agent or Travel Provider?
Most travel agents also provide travel insurance services through a vendor such as CSA. However, it's important that before paying for it that you look at the exact policy and who the policy is actually through. Does that company have a good reputation and will you have to work with that company or directly with your travel provider if something happens?
Before You Purchase Travel Insurance Make Sure to Read the Policy Details Completely!
While your policy might be less than $100 or more than $500 depending on various factors, it's essential that you choose a provider that is transparent with its details before you make the purchase decision, sends you a complete copy of the policy details, and then offers you a chance to review the policy and get a refund if you didn't understand something correctly at the point of purchase. This is really important since purchasing travel insurance can be a complicated process with lots of things to consider as we've discussed above.
This is also critical so that you have the proper expectations should something happen. For instance - if you are required to provide receipts for a claim to be processed then you had better know that from the onset of your trip!
Tips to Save Money When Purchasing Travel Protection Insurance ...
Saving money on travel insurance is more than just getting the cheapest rate. That initial savings might end up costing you thousands of dollars in the event that you need to file a claim.
When it comes down to the point of purchase, it can still be hard to justify buying something that has the perception of being "not needed". Unfortunately, many in the insurance industry have exploited customers for years and so there is healthy skepticism with the purchase of any policy. Instead of saying "do I need it" or "can I afford it", the question should be "what coverage do I need". This is the best way to make sure that you save money.
- Pick a plan with the coverage that is right for your needs. This means looking at the coverage amounts, coverage details and selecting a plan that matches your travel plans.
- Look at the TOTAL cost of a plan. Some plans are priced like value airlines where you see a low initial price but then tons of addons.
- Pick a company with a great reputation. I like CSA Travel Protection because they've operated for 25 years and are based right here in California. That isn't to say that there aren't other great companies out there, but you want to make sure that the company is solvent and is able to actually make good on the payment for your claims should that be necessary.
- If you are more concerned with "during the trip" factors vs "pre-trip" factors, wait until you are ready to depart to purchase your policy. It might only save $50 but that's still something and policies are generally cheaper then because there is less risk of something happening that would force a trip cancellation. Be careful though, for expensive trips with multiple people (especially if some are older) it is still a good choice to purchase in advance because saving $50 and but possibly losing $5,000 doesn't make much sense either!
At the end of the day, it's your choice to play the odds or protect your investment. For my upcoming trip, I decided that it made a lot of sense and CSA Travel Protection seemed like a great company to go with, but my fingers are crossed that I won't have to use it!