There is no insurance policy that prevents any unexpected situation from ruining your vacation. But if you spent a lot on your trip, the insurance at least can help you recover a good part of the money that you would otherwise lose. Here we present the most important questions you have to ask yourself to decide whether you buy it or not.
1. How likely is it that you get sick or your travel companion becomes ill?
If your answer is “very likely”, then it would be very sensible to buy a travel cancellation policy. Some insurance agencies include coverage for pre-existing conditions if you purchase the policy within a certain time.
2. Does your luggage include clothing, jewelry or expensive equipment?
If you will travel with items that you should ensure verify if your current policy covers them. Your credit card company may offer coverage for your checked bags or even for your carry-on baggage. Your policy as a homeowner or landlord could also cover some of your valuable items (if you do not have one, you can add provisional coverage to your policy). If you decide to buy a separate travel insurance policy, you should know that you will be reimbursed for the value of valuables in your lost or stolen cash and only up to an established limit (often $ 500). Other policies may also cover the “reasonable” purchase value of replacement items, such as clothing, that you may need while waiting for your luggage to arrive.
4. How vulnerable are you to extreme weather conditions?
If you purchased a travel package and an extreme weather event requires you to cancel the trip in full, you will receive a refund (except for the extra tickets and other expenses). But consider other possibilities. Does your itinerary include stopovers where snow and ice could cause delays or loss of connecting flights? Will you travel near an ocean in the summer or fall? If so, keep in mind the hurricane season: from June 1 to November 30 in the Atlantic and from May 15 to November 30 in the East Pacific. If hurricanes can present a problem, make sure your policy provides for “natural disasters” and buy it a long time in advance. The cover usually applies only if you buy it before the hurricane receives the official name.
5. How much money can you spend if something unexpected happens, or extremely unexpected?
Many insurance policies also offer coverage if the disaster occurs in your home. For example, policies that include “uninhabitable main residence” in your terms will allow you to cancel your trip so you can deal with last-minute situations, from theft to flooding.
And then, of course, there are fortuitous events. Do you remember that volcanic eruption in Iceland in April 2010? The ash cloud that remained as a result of the eruption forced the cancellation of all trips to and from Europe for six days, which affected some 10 million passengers. In such situations, insurance policies offer reimbursement of hotel expenses and car rental up to an established limit.
If you decide to buy travel insurance, here are some guidelines.
1. Do not buy the insurance offered by tour operators, representatives of cruise companies or travel agents, who charge commission for the policies they sell. Find an online insurance broker, such as travel.policybazaar.com, orwww.icicilombard.com, which sell policies from different providers. You can select the policy according to your needs. Your age, the duration of your trip and the destination affect the price of the policy, but usually cost between 4 and 8% of the total price of the trip.
2. Do not wait long to buy. Although you can wait until the day before your trip to buy insurance, insurance companies regularly include more benefits – such as a waiver of exclusions for pre-existing medical conditions or the inclusion of protections against terrorism or breach by the insurer. Travel provider – if you buy the policy one or two weeks after making the initial purchase of your trip. Many companies offer a review period: if you buy the policy at the same time you pay for the trip, you can cancel the policy and get a refund within a period (usually 10 days) if you change your mind before making the trip.
3. Read the copy of the policy , including the fine print, and talk to your agent before buying. If your travel cancellation cover is among your needs, make sure that the policy covers most or all of the worst possible scenarios. Travel cancellation policies contain a complete list of “reasons that cover insurance” or “specific risks”. But if the reason you present is not on that list, they could deny the claim. The most expensive policies give you the option to cancel for any reason, which may be your best alternative after you evaluate all your possible needs.