The Smart Traveler: Travel Insurance

Travel Insurance is a necessary evil, especially as you get older, or have less people in your life who can help you in the event of an emergency. If you plan a long trip with a complicated itinerary or travel on an organized tour, there is plenty that can go wrong that could cost you money. So the question is not really whether or not you should purchase the insurance. It is how to best maximize that purchase so you will get a return on your money. If you travel often enough, and if you are smart in the way you make your purchase, travel insurance can actually pay for itself.

Purchase only a percentage of the full amount

All insurance is a bet against whether or not you will use it. So when you purchase travel insurance, you are betting you will need it. The fact is, the chance that you will need a percentage of the trip covered is pretty high. The chance you will need the entire trip covered is very, very low. Unless you experience a complete wipe out, where nothing will be retrievable in the event of illness or cancellation, only that potion you feel comfortable paying for is the amount you should insure for. If you are going on a tour that costs $5,000 and you pay an additional $2000 in air that means you want to be covered for $7,000 right? Not necessarily. Most tour companies will be happy to keep your business by moving your trip to another date if necessary, and almost all airfare is changeable for a small price. In the event of a family death, the airlines will typically refund your money in full as long as the flight has not yet departed. The same is true for frequent flier miles in the event of death. So you may be best served by insuring yourself so you can fly home if an emergency occurs, as well as for medical expenses and emergency evacuation if you are travelling to a remote area. The cost will likely be half of what it would be if you purchased insurance for the full amount.

Do not purchase from a tour company

The most expensive way to go is through the tour company that offers the tour. It not only covers you for expenses you will likely not need, it will not cover you at all if you are doing solo travel before or after the tour. Bear in mind, the tour company will likely change your tour dates without charge if necessary, and regardless of insurance coverage. This is not true however, if they offer deals like “Cancel up to the day of departure, ” in which case purchasing their insurance is required. This is frequently offered in countries where there are problems and they are trying to induce tourism, like Africa and Russia. You can also purchase full trip insurance on your own with a cancel for any reason clause as long as you purchase it within two week so of having made your initial deposit. One place to look for top rated travel insurance companies is cost is typically lower than going through a tour company, the wide variety of coverage that is offered is through well known insurers, and they pay in a timely manner on claims with great customer service.

Save all proof of payment and receipts

If you need to file a claim, you need all the receipts plus the proof that you have paid those bills if you put the purchases on a credit card. So make sure to save all documentation or it will be like not having the insurance at all.

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