Travel Insurance: 3 Things to Know

Have you ever considered purchasing travel insurance but weren’t sure how to begin – or whether it would even be worth having? Fear not! It’s actually pretty easy to determine if you need it, as well as obtain it, if you do. It’s a matter of knowing the answers to three questions! 

Travel insurance can be beneficial in many scenarios. For example:

• A family member has a medical emergency a few weeks prior to your trip.
  
  
• You are overseas and experience a medical emergency and your health insurance doesn’t provide foreign coverage.
  
  
• You have to stay an extra night due to a flight cancellation or another problem.
  

Travel insurance is a safety net that can see you through any of these unexpected issues. But don’t rush out to purchase coverage on your upcoming getaway just yet! The cost of the insurance can be an invaluable expense – but it may not be a necessary one. Before you buy, be sure you know the answers to the following three questions.

Question #1: Do I Actually Need Coverage?

Travel insurance is best suited if you’re prepaying for a costly vacation. This includes vacations outside the United States, as well as more extravagant vacations within the U.S. – think cruises to Alaska or Hawaii. Travel insurance is particularly important if your health insurance doesn’t provide coverage in foreign countries and you have an accident or a known medical issue that could arise while on the trip.

According to the Centers for Disease Control and Prevention (CDC), the Social Security Medicare program, in particular, does not provide coverage for medical costs outside the United States. However, some Medigap and Supplemental Medicare insurance programs do provide limited overseas coverage.

You may already have some amount of travel insurance without even knowing it – surprise! Often credit card companies provide a certain amount of travel coverage for specific issues such as flight cancellations or lost baggage. Prior to purchasing travel insurance, call your credit card company or check its website to see what benefits you may already have.

Bottom line: If the financial risk of canceling a prepaid vacation or experiencing emergency health issues abroad is too great, travel insurance is a wise investment.

Question #2: What Are the Different Types of Travel Insurance?

Each type of coverage fills a specific need.

• Standard trip insurance covers general travel mishaps such as missed departures and cancellations.
  
  
• Supplemental health insurance provides short-term medical coverage in foreign countries for those traveling abroad. It is relatively inexpensive.
  
  
• Medical evacuation insurance covers the expense of travel to a hospital and/or home as a result of a medical emergency. According to the CDC, medical evacuation costs may exceed $100,000. If you are not able to afford this cost, obtaining evacuation coverage might be a very wise decision.
  

Standard trip, supplemental health, and medical evacuation policies can be purchased separately or in a comprehensive package, depending on the provider. For example, if your credit card company provides an adequate amount of standard trip insurance, you may need to purchase only supplemental health and medical evacuation coverage.

Question #3: When and Where Should I Buy Coverage?

Often costly vacations are planned and paid for months in advance. If you decide to move forward with purchasing travel insurance, you should plan to do so shortly after your trip is booked. The first 14 days after booking is ideal. It’s possible to purchase travel insurance closer to your departure, but the coverage offered may not be as extensive.

You can obtain travel insurance from numerous places. Private insurance companies, insurance brokers, travel agents, and certain websites all sell coverage. Check out a few options and compare the policy offerings regarding the amount and type of coverage, as well as the cost. For frequent international travelers, consider a company that sells annual renewable policies to eliminate the task of purchasing coverage for each trip.

One last tip: If you have existing medical conditions, tell the insurer prior to purchasing coverage. The CDC lists preexisting illness and poor documentation as the main reasons companies refuse claims.

Summary

When planning your next vacation, be sure to consider travel insurance. If you determine coverage is needed, check around for the best deal. As always, read the fine print on any policy prior to purchase. You’ll be able to enjoy your vacation even more knowing you’re covered!