A Travel Expert's Guide to Travel Insurance

This is potentially the most important article you read before you book your trip! Here’s the scenario - you’ve spent months researching and picking out your dream hotels and carefully curating your top activities, everything from helicopter rides to snorkeling in turquoise waters, and finally, you’ve put the first payment down on your trip and you’ve booked the flights! You sit back with relief thinking your trip is all set BUT this is one of the most crucial moments for your upcoming trip. 

This is the moment when you have to decide whether you will purchase travel insurance and even though no one wants to think about the potential scary things that might happen during your trip, there are a number of reasons why it is worth your money.

Let’s start with the basics. 

What is travel insurance?

Travel insurance is an insurance policy that protects you from the various things that happen while you’re traveling abroad. It can be provided by a number of insurance companies and if you have a travel credit card, you likely have some coverage through your card as well. The biggest difference between your credit card travel insurance and larger insurance companies is that the claim benefits are higher with a larger company and the claims process can be easier in some cases.

When should you purchase insurance?

You should purchase insurance within the first 15 days of the first deposit of your trip. If you purchase during this time frame, insurance policies will waive their policies on pre-existing medical conditions so this is especially important if you or a loved one has an on-going medical condition that potentially affects your trip. You also have the option to add on an optional cancel any reason policy (usually an additional few hundred dollars) within 21 days of your first deposit. A cancel for any reason policy means you can cancel for literally any reason and claim up to 70% of your trip cost back. 

If you didn’t decide to purchase insurance right away and change your mind, don’t panic, you can still purchase insurance up to 2 weeks before your trip departure date. But be warned that if you are purchasing the insurance to cover yourself for a problem that you already know exists in the country, i.e. an upcoming predicted natural disaster, political unrest, etc. then it would be considered a “pre-existing” condition and you would not be eligible for coverage. 

If you purchase within the first 21 days, you also have coverage if the airline, cruise line, or tour operator goes into financial default. 

Who is covered under the policy?

An insurance policy is priced by the age of the travelers, state of residence, and the amount spent. One insurance policy is issued per household so your whole family is covered under one plan, as long as you put their information into the original quote. 

What are the top reasons to purchase insurance?

The most common situations are:

1. A missed flight connection leads to paying for an extra night at a hotel and a lost night at a client’s original hotel.

2. Luggage gets lost or stolen and the client needs to purchase necessities until their luggage arrives.

3. A medical emergency occurs (sometimes, something as small as a stomach bug) and someone ends up in a foreign hospital. Or a medical emergency happens to a family member and the clients have to cut their trip short to get back home. 

4. Your place of business requires that you be there so you can no longer travel during your original dates. Or you get laid off before the trip. 

5. A transportation strike occurs and you cannot travel or get to your destination on time. For example, if you are in Italy,  the airline workers strike and you cannot get to the next city on your itinerary and that results in a missed night at your original hotel and a night at a new hotel.

6. Your home or your destination is made “uninhabitable” by inclement weather or a natural disaster. “Uninhabitable” means (1) the building structure itself is unstable and there is a risk of collapse in whole or in part; (2) there is exterior or structural damage allowing elemental intrusion, such as rain, wind, hail or flood; (3) immediate safety hazards have yet to be cleared, such as debris or downed electrical lines; (4) the property is without electricity, gas, sewer service or water; or (5) the Destination is Inaccessible by transportation companies. 

7.  A terrorist event occurs in a city listed on your itinerary within 30 days of

your scheduled arrival

What about hurricanes in the Caribbean, flooding in Venice, the wildfires in California?

This is a tricky one! If a hurricane is named and predicted and causes cancellation or interruption of travel to your destination that is inaccessible or uninhabitable (see above for what is defined as “uninhabitable”), THEN you cannot request a claim to cancel your trip. 

For other natural disasters, the destination must be inaccessible by transportation carriers or a state of mandatory evacuation has been declared up to 24 hours prior to your arrival. 

I’m paying a ton of money for this trip. Why can’t I be the exception, can’t you do anything else to guarantee a refund?

I know how emotional and scary it is when disaster strikes. It’s your dream trip and it seems to disappear in a flash. Every single person wonders why their trip can’t be the exception for full refund but these policies are universally set by the tourism and insurance industries and are legally binding. Unfortunately, there’s just not much anyone can do if your reason for canceling falls outside of the coverage. 

If you are worried about not having enough flexibility with your itinerary, bring it up with your travel advisor in your initial planning call. They can then make sure you don’t use non-refundable prepaid rates at hotels and select activities with more flexible policies. If you do get a flexible non-refundable rate, you usually have 24-48 hours to make changes, with the exception being the busiest high seasons.

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I've purchased insurance. When should I file a claim?

You should keep records and receipts of every expense you are filing a claim for. Your travel advisor can help you put together the documents but then it is your responsibility to follow through with the claim and get in touch with your travel insurance company. You should file the claim immediately.

So to sum it up, there are a number of reasons to purchase insurance and protect your trip but make sure you read the fine print and pick the best plan for you!