Gaurav Bhola, MSM, Managing Editor
For protection against unforeseen circumstances with potentially disastrous effects on their plans or trips, more and more savvy travelers are purchasing travel insurance. Travel accident insurance, for example, is particularly recommended for families with young children. It is important to note, however, that different insurance companies issue different policies with different coverage possibilities and limitations. Therefore, it is crucial that travelers first study their travel insurance options and read carefully the fine print before selecting the policy that best addresses their concerns and offers the protection they need.
What follows is a brief overview of the most common types of travel insurance:
- Trip cancellation/Trip interruption Insurance: Consumers utilize this form of travel insurance for protection against trip cancellations or interruptions caused by unforeseen events such as sickness, serious injury, and death of a loved one. Trip cancellation insurance reimburses travelers for unused or nonrefundable deposits or payments. It usually does not cover cancellation due to war, acts of God, bankruptcy of the tour operator, or terrorism. Trip cancellation coverage costs more than interruption travel insurance.
- Trip delay: With this travel insurance coverage, travelers who experience trip delay are reimbursed for expenses.
- Baggage insurance (or Personal Effects Delay or Loss): This type of travel insurance protects consumers against losses resulting from luggage or personal effects damaged, delayed or lost during a trip. Travelers should ask their trip operator or airline how much coverage is available for these items before proceeding to purchase this travel insurance.
- Accidental death: This type of travel accident insurance offers coverage in the event that the traveler or a member of his family dies while on a trip.
- International travel health insurance: With this form of travel health insurance, consumers are reimbursed for medical bills incurred while visiting or living abroad for two weeks or two years.
- Emergency medical assistance and evacuation: This type of travel accident insurance and travel health insurance covers emergency transportation for a medical emergency. If the traveler falls ill or suffers a physical injury during the trip, he is flown home or to the nearest medical center for medical treatment. Individuals visiting remote areas will especially benefit from this form of travel accident insurance offering medical care and treatment.
- Emergency medical insurance: Emergency medical insurance is a hybrid of travel accident insurance and travel health insurance that offers the following coverage:
Reasonable expenses for the return of the policyholder's remains in the case of death
Cash reimbursement for delayed luggage
Reimbursement for damaged, stolen, and lost luggage and personal effects
Cash reimbursement to the policyholder or beneficiary in the case of loss of limb, loss of sight, or accidental death.
Purchasers of this travel insurance are provided a telephone number which they can dial for referral to English-speaking physicians while they are abroad.
- Nonrefundable ticket: This is not your typical travel accident insurance because in this case, a policyholder is reimbursed for a nonrefundable ticket purchased through a travel agent. This type of travel insurance covers situations where a traveler is unable to use his nonrefundable ticket and either wants to avoid paying the $100 change fee and reschedule the trip or no longer wants to take the trip.
- Supplier default: This type of coverage is also distinct from travel accident insurance. With this variety of travel insurance, a policyholder is reimbursed for payments or deposits lost as a result of a travel operator's financial default.
In conclusion, travel insurance provides consumers with a safeguard against unforeseen circumstances such as illness or injury, baggage loss, and travel delay. For travelers worried about the potentially costly aftermath of such unexpected eventualities, travel insurance is a wise investment. Before embarking on this course, however, travelers should understand the coverage offered by the different travel insurance companies and the exceptions carved out in their policies.