Understanding Travel Insurance

Whether you’re spending money on a long-awaited trip or a spur-of-the-moment getaway, having travel insurance can save you money, time, and frustration if things go wrong.

Travel doesn’t always go as planned. If you're going overseas, travel insurance is as important as a passport. Without it, you or your family could suffer financially if things go wrong. No matter who you are, where you're going, and what you're doing, get insurance. Moreover, purchasing it truly lets you leave the worries behind when you travel for work or a holiday.

However, keep on reading to learn more about getting insurance coverage while you're on a trip abroad. In this article, we will provide information in full detail on everything you need to know about travel insurance, what it covers and what it doesn't, the reasons you may need to have one, how to purchase travel insurance, and more.

What is Travel Insurance?

Travel insurance is a type of policy that reimburses you for the money you lose from non-refundable deposits and payments when something goes wrong on your trip. It is an insurance product for covering unforeseen losses incurred while traveling, either internationally or domestically. These problems or losses can range from lost baggage to flight delays to medical problems.

Moreover, basic policies generally only cover emergency medical expenses while overseas, while comprehensive policies typically include coverage for trip cancellation, lost luggage, flight delays, public liability, and other expenses. However, the more you’re spending on your trip, the more you are likely to need travel insurance. This is especially true for international trips and cruises, where travel problems become more expensive to solve.

Furthermore, many companies selling tickets or travel packages, give consumers the option to purchase travel insurance, also known as travelers insurance. Although it is frequently sold as a package, travel insurance may include several types of coverage. The main categories of travel insurance include trip cancellation or interruption coverage, baggage and personal effects coverage, medical expense coverage, and accidental death or flight accident coverage.

Moreover, travel insurance coverage usually includes 24/7 emergency services like replacing lost passports, cash wire assistance, and re-booking canceled flights. Certain policies may duplicate existing coverage from other providers or offer protection for costs that are refundable by other means.

Travel Insurance Categories

The main categories of travel insurance include trip cancellation or interruption coverage, baggage and personal effects coverage, medical coverage, and accidental death or flight accident coverage. We will be discussing each of them below:

Trip Cancelation or Interruption Coverage

Trip cancelation, otherwise known as trip interruption or delay, reimburses a traveler for prepaid, nonrefundable travel expenses. Comprehensive travel insurance policies include cover for any cancellation fees or lost deposits relating to the cancellation of the insured person's trip for a range of unforeseen and unexpected circumstances.

Moreover, insurance providers vary on acceptable cancellation and interruption causes and the amount of reimbursement available. The most common acceptable reasons include illness or injury, a death in the immediate family, sudden business conflicts, and weather-related issues.

However, depending on the policy, it may also include cancellation due to jury service, being made redundant from full-time employment, having annual leave revoked for those in the armed forces or emergency services, and prohibition of or advisory against travel by a government to a particular destination.

Furthermore, keep in mind that trip cancelation or interruption coverage may be canceled if you are traveling to a region that is known to have been affected by a serious weather event such as an earthquake.

Loss of Baggage

This type of coverage protects or covers for loss, damage, or theft of personal effects during one's journey, including passports and other travel documents. It may include coverage during travel to and from a destination. Most carriers, such as airlines, reimburse travelers if baggage is lost or destroyed because of their error. However, there may be limitations on the amount of reimbursement. Moreover, loss of baggage travel insurance coverage may also include limited benefits for theft of cash.

Medical Coverage

Travel insurance is especially important if you need medical assistance. Healthcare services abroad can be very expensive. Medical coverage can help with medical expenses, help to locate doctors and healthcare facilities, and even assist in obtaining foreign-language services. Moreover, as with other policies, coverage will vary by price and provider. Some may cover airlift travel to a medical facility, extended stays in foreign hospitals, and medical evacuation to receive care.

In the event of a minor injury or illness overseas, medical coverage covers visits to general practitioners, medicine, ambulance fees, and limited dentistry benefits. And in case of hospitalization, most travel insurance policies include emergency assistance services, which can offer guarantees of payment to hospitals for treatment, liaise with treating doctors, and organize transfers between hospitals or medical evacuations back to the insured person's country of origin.

Accidental Death and Flight Accident Coverage

Moreover, if an accident results in death, disability, or serious injury to the traveler (policyholder) or a family member accompanying the traveler. Then, an accidental death and flight accident insurance policy pays benefits to surviving beneficiaries. Besides, flight accident insurance provides coverage for accidents and deaths occurring during flights on a licensed commercial airplane. However, general exclusions will apply, such as death caused by drug overdose, death resulting from sickness, etc.

What is not covered by Travel Insurance?

Furthermore, there are common things that are not covered by travel insurance. Therefore, make sure you read an insurance policy's exclusions so you're not caught by surprise later. Insurance providers issuing will often exclude coverage for ongoing known events to new policies, and may announce long-term exclusions for specific events, such as volcanic activity from a currently active volcano.

Here's another example of circumstances that are not covered by travel insurance. A policy could have medical coverage but exclude pre-existing conditions. Therefore, if an existing condition outburst during your trip, the policy will not cover it unless you purchased a pre-existing conditions exclusion waiver.

Moreover, as insurance is a risk-based product, many policies will exclude events that may be of a far-reaching and poorly quantified risk, such as pandemics and endemics, acts of war, and terrorism. Some policies exclude travel to certain countries, or parts of countries, where there's a possibility of greater risk.

Why Do You Need Travel Insurance?

Furthermore, here are some reasons you may need travel insurance:

• You stand to lose a lot of money in non-refundable deposits if you cancel the trip. But travel will cover 100% of the pre-paid money you’ll lose. As long as you cancel for a reason listed in the policy.
• Moreover, many health plans lack robust global coverage. However, travel medical insurance fills the gap.
• Furthermore, if you won’t near any quality medical facilities, even a small injury could turn into a major medical event. Medical evacuation coverage will pay to medevac you to an adequate facility.
• Travel insurance policies also feature 24/7 travel assistance lines. That can assist you with finding a pharmacy, language translation, replacing a lost passport, and much more.

Points to Remember When Purchasing Travel Insurance

The cost, coverage, and exclusions of a travel insurance policy will vary by the provider. So, prior to purchasing insurance, you should be aware of reading all disclosure statements. Moreover, coverage is available for single, multiple, and yearly travel.

While standard insurance plans cover one-time trips, frequent travelers should consider an annual insurance plan. These plans cover the same issues as a single-trip plan, such as trip cancellation and emergency medical situations. But they also offer the convenience of one-time purchases for multiple trips.

Furthermore, in addition to the duration of travelers' insurance coverage. Premiums are based on the type of coverage provided, a traveler's age, the destination, and the cost of your trip. In conclusion, resist the temptation to just get the cheapest option without checking that it suits your needs. Even if you haven't purchased travel insurance before, you might want to consider it now.