Happy Trails 2021!

Disclosure: I’ve never purchased travel insurance. I almost did when I took my daughter to NYC for her 18th birthday in 2020–January, mind you–but I made sure the arrangements were all refundable by a certain date. The fact that the city shut down less than two months later because of a pandemic would have been unimaginable, and has prompted travelers to take precautions they might not have otherwise. Here’s a primer on travel insurance.

Travel insurance is coverage designed to protect against risks and financial losses that could happen while traveling–from minor inconveniences like missed airline connections and delayed luggage to more serious issues including injuries or major illness. As we know, Covid-19 has shoved the elephant out of the room, so I’ll begin with FAQ regarding travel insurance coverage and cancellation for illness.

Does Travel Insurance Cover the Coronavirus Pandemic?

On January 21, 2020, the Coronavirus disease 2019 (COVID-19) became a named event, which affects the travel insurance coverage available for new policies purchased thereafter because it is known. Insurance is designed to protect you from an unpredictable or spontaneous loss. For example, if a hurricane ruins your trip, travel insurance would only cover you if you bought it before the hurricane formed. Be sure to purchase insurance as early as possible and always read the fine print no matter what policy you choose.

Comprehensive travel insurance

This is the typical policy that people imagine when they think of trip insurance. The comprehensive policy usually covers delays, cancellation due to sickness or death, lost luggage and some emergency medical costs.

Benefits included in comprehensive coverage may apply in the following unforeseen scenarios:

• Emergency Medical Coverage: a sick traveler must see a doctor and/or go to the hospital during a trip.
• Emergency Medical Evacuation Coverage: in rare cases, a sick traveler requires an emergency medical evacuation to the nearest appropriate hospital or back home for recuperation.
• Trip Interruption: an extremely sick traveler cannot continue with a trip and must return home.
• Cancel For Any Reason: Currently, if you are looking for trip cancellation coverage because you are concerned about the coronavirus, you will now need to purchase a plan that includes Cancel For Any Reason since the travel warnings are now foreseen. This benefit is time-sensitive and has other eligibility requirements, so not all travelers will qualify.

Some plans may exclude epidemics/pandemics and may not provide coverage for related issues. Please be sure to read the plan details carefully before purchasing.

Over the course of the coronavirus pandemic, many traditional travel insurance companies have expanded or adapted their existing coverage for travelers. In addition to the coverages above, examples of these may include:

• Reimbursement for covered medical treatment during a trip due to a COVID-19 illness
• Get sick with COVID-19 and must cancel a trip by physician’s order
• Physician orders a quarantine before trip
• Lost a job during the coronavirus pandemic by no-fault of your own

Cancel For Any Reason (CFAR) offers the most trip cancellation flexibility and is the only option available to cover fear of travel. CFAR is an optional, time-sensitive benefit with eligibility requirements, so not all travelers will qualify. Full terms of coverage will be listed in state-specific policy. If eligibility requirements are met, reimbursement is up to 50%-70% of the insured prepaid non-refundable trip cost.

InsureMyTrip.com

Does Emergency Medical Coverage Travel with You?

Some travel insurance plans do offer emergency medical benefits if you need a doctor or hospital visit during a trip. Check your personal health insurance plan first to understand coverage already in place. However, most health insurance plans don’t provide full coverage in foreign countries and some health plans provide no coverage at all. Travel insurance works in addition to your everyday health insurance and can help supplement medical costs if you get sick or injured before or during your vacation.

If you have Medicare or Medicaid, be aware that medical costs overseas are generally not covered.

Before purchasing a policy, it is imperative to read the policy provisions to see what exclusions apply, such as preexisting medical conditions, and do not assume that the new coverage mirrors that of an existing plan.

Emergency medical coverage may be redundant. Most health insurance companies pay “customary and reasonable” hospital costs if you become sick or injured while traveling, but few will pay for a medical evacuation.

From InsureMyTrip.com, medical plans and coverage to consider include:

• Travel Medical Insurance is offered either as part of comprehensive travel insurance plans or can be purchased as a stand-alone plan. These plans only offer coverage while traveling outside of your home country. Contact your regular health insurance provider to inquire about global benefits and how your benefits apply when you are outside of your home country.
• Emergency Medical Evacuation Coverage provides transport assistance in the event that you become seriously ill or injured while traveling. Generally, these plans provide emergency medical evacuation to the nearest appropriate care facility if the assistance company and the physician feel you’d be better suited at a different facility. For those who want to ensure transport to the hospital of their choice, travelers may want to consider also purchasing an air medical transport membership. If hospitalized during your trip, this membership may provide transport to a hospital of your choice, often closer to home, without it being determined as “medically necessary” as required on typical travel insurance plans. (For medical transport memberships, some destination restrictions may apply for evacuations related to COVID-19.)
• Trip Interruption Coverage is included in travel insurance comprehensive plans. It’s a benefit that offers travelers reimbursement of their pre-paid, non-refundable expenses should they unexpectedly need to cut their travels short. However, there are exclusions for this, so be sure to review your policy carefully.

For travelers looking for more information regarding CDC regulations , please refer to the U.S Centers for Disease Control and Prevention website.

Lost or Stolen Luggage

Travel insurance can help cover expenses stemming from lost or stolen luggage. This is especially useful if an airline loses your bags, as it can be very difficult to get them to pay for lost luggage. In the United States, the Department of Transportation (DOT) requires airlines to compensate fliers up to $3,300 for lost baggage. In foreign countries that amount is a maximum of $1,750. But to receive those maximum amounts, passengers must provide receipts proving the value of the lost bags and their contents. And some airlines require that the claim be filed within 21 days.

To make matter worse, DOT doesn’t define when baggage is officially lost (as opposed to just “delayed”). Overseas, a bag is only considered “lost” after 21 days. For delayed bags, DOT only requires airlines to provide victims with enough money to buy necessities like clothing, medicine and toiletries.

The possibility of baggage and personal belongings being lost, stolen, or damaged is a frequent travel problem. Many travel insurance policies pay for belongings only after you exhaust all other available claims. Your homeowners or renters insurance may extend coverage outside of your domicile, and airlines and cruise lines are responsible for loss and damage to your baggage during transport. Also, credit cards may provide automatic protection for things like delays and baggage or rental car accidents if used for deposits or other trip-related expenses.

What if. . . Plans Change

Travel insurance can help cover costs stemming from trip cancellations. Most resorts or cruise lines won’t give you a full refund in the event of a cancellation. If you cancel two weeks or more before your trip, most resorts will at least charge a cancellation fee; many cruise lines might only give you a 25% refund or will give you partial credit on another cruise. If you cancel within two weeks of a trip, with most companies you won’t give any refund whatsoever. Unforeseen circumstances happen, and you want to be covered just in case.

Before looking into travel insurance, think about the reasons you might cancel. Is a trip delay due to weather going to dramatically change your vacation? Is it possible your school year will be extended, or you will need to take a work-related trip instead? Are there acts of war in the country you’re going to visit? Are you nervous about the CDC issuing a travel warning for your vacation destination?

These are all valid reasons, but not all travel insurance covers these concerns. When booking a pricey trip, investigate insurance at the same time. Some policies require you buy travel insurance within a certain amount of time after making your initial trip payment, such as within 10 to 30 days.

Purchasing Travel Insurance

Travel insurance will vary by the provider on cost, exclusions, and coverage. Be sure to read all disclosure statements and check what protections your credit card might offer.

Coverage is available for single, multiple, and yearly travel. Per-trip coverage protects a single trip and is ideal for people who travel occasionally. Multi-trip coverage protects numerous trips occurring in one year, but none of the excursions can exceed 30 days. Annual coverage is for frequent travelers. It protects for a full year.

Premiums are based on the type of coverage provided, a traveler’s age, the destination, the duration, and the cost of your trip. Standard per-trip policies cost between 4% to 10% of the trip’s cost. Specialized policy riders focus on the needs of business travelers, athletes, and expatriates (i.e. working overseas).

Also, it is suggested that a traveler register travel plans with the State Department through its free travel registration website. The nearest embassy or consulate can contact them if there is a family, state or national emergency.

Worthy travel insurance plans always include the following provisions:

• Coverage for most countries in the world (including the places you plan on visiting).
• Some coverage for your electronics (and have the option for a higher coverage limit).
• Coverage for injury and sudden illnesses.
• Offer 24/7 assistance (you don’t want to call to be told to call back later).
• Coverage for lost, damaged, or stolen possessions like jewelry, baggage, documents, etc.
• Coverage for cancellations for hotels, flights, and other transportation bookings if you have a sudden illness, death in the family, or some other emergency.
• Coverage for political emergencies, natural disasters, or strife in the country that cause you to head home early.
• Financial protection if any company you are using goes bankrupt and you are stuck in another country.

Recommended online agencies for the best service and value are:

SafetyWing (all ages)

Insure My Trip (best for those over 70)

Medjet (for additional evacuation coverage)

What’s Not Covered By Your Travel Insurance

Just as important as knowing what your plan covers is knowing what it doesn’t cover. Generally speaking, most plans don’t cover:

• Accidents sustained while participating in extreme adventure activities such as hang gliding, paragliding, or bungee jumping (unless you pay for extra coverage).
• Alcohol- or drug-related incidents.
• Carelessness in handling your possessions and baggage.
• Recklessness (how “reckless” is defined is a matter up to each company).
• Pre-existing conditions or general check-ups. For example, if you have diabetes and need to buy more insulin, you won’t be covered. If you want to go see a doctor for a general check-up, you aren’t covered either.
• Lost or stolen cash.
• Your theft coverage won’t cover you if you left something in plain sight or unattended.
• If civil unrest makes your destination unsafe but your government hasn’t called for an evacuation, you’re probably out of luck too.

Options to include:

• Payment for expenses if you get sick or injured on a trip
• Travel medical and accident coverage
• To be taken to the nearest hospital or flown home if necessary
• Emergency evacuation and repatriation
• Reimbursement if you get sick and have to cancel or end your trip early
• Trip cancellation AND trip interruption
• Payment for lost, stolen or damaged luggage or goods
• Theft and lost baggage overage
• Help finding a doctor abroad
• 24-hour assistance
• Payment for rental car damage
• Car collision insurance (CDW)

[The above excerpted from Nationwide.com]

I believe travel is good for the soul, and travel insurance is good for peace of mind. Look into the options, talk to your agent, and decide whether it’s worth it to you.

Cheers to 2022!