These Travel Insurance Blindspots Can Cost You Money
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You’ve picked your destination, booked flights, made hotel reservations and reserved tours. And maybe you’ve purchased travel insurance to protect your trip investment.
Even experienced travelers can miss important details when choosing a travel insurance policy. Here are blind spots that could cost you money.
Not Insuring the Full Value of the Trip
If your trip needs to be cut short or canceled entirely, you want to get reimbursed for your lost prepaid and non-refundable costs. If you don’t insure your entire non-refundable trip cost you’ll be missing the chance to get the maximum possible reimbursement.
“This can happen if you purchase an insurance policy very soon after having made your initial 50% deposit on a big trip and only insure for that deposit amount,” says Scott Adamski, a spokesperson with AIG Travel. “You may have plans to upgrade your policy as soon as you’ve paid for the remainder of their trip, but neglect to do so for one reason or another.” In this scenario you’ve had a blind spot on insuring the other 50%.
He points out that this issue commonly arises for cruise vacations: You may not yet know all the excursions you wish to take as part of your cruise at the time you book.
As you build on your original trip plans, make sure to adjust your policy as needed to cover what you could lose.
Not Utilizing Value-Added Travel Insurance Benefits
Travel insurance plans generally provide a 24-hour travel assistance and emergency hotline that can help with a variety of issues—both before and during a trip.
“You may be unaware a travel policy offers a wide array of assistance services including medical assistance, translation, security assistance, concierge services and more,” says Adamski. “Knowing about the availability of these services could add a great deal of value to your trip.”
Misunderstanding Medical Coverage Outside the U.S.
If you’re traveling outside the U.S., in most cases your domestic health insurance coverage won’t follow you as you travel abroad. The same is true for Medicare. This is a blind spot that could lead to big medical bills abroad if you haven’t purchased a sufficient amount of travel medical insurance.
Travel insurance plans can reimburse you for medical expenses and even help front some of the costs if prepayment is required to obtain treatment.
Additionally, says Adamski, the 24/7 assistance service of a plan can provide medical-related help:
- If you have a medical emergency during the trip, your travel insurance company’s medical assistance team can help you identify an appropriate facility. If the emergency takes place in a foreign country where you have a language barrier, this assistance can even be critical.
- The medical assistance team can also assist with lost or depleted prescriptions, helping you connect with a local doctor or a pharmacy that can assist.
- If your medical condition requires special arrangements for the flight back home (such as an upgraded seat, a lay-flat seat, a nurse escort or more), your travel insurance company can help coordinate those arrangements.
Underestimating Medical Evacuation Cost
Having to make an emergency medical evacuation is a worst-case scenario, but that’s what insurance is for. Lacking enough coverage for an expensive problem could be a blind-spot.
If you have to be medically evacuated, this can be remarkably expensive, says Adamski. “Even just from the Caribbean to Miami, an air ambulance will come with a five-figure cost, and we have seen many evacuations that land in the six figures,” he says.
Because payment has to be confirmed before an air ambulance will even take off, Adamski says you should consider where funds would come from in such a circumstance.
“Facing such a financial burden while trying to get home could certainly be overwhelming,” he says. “A travel insurance plan with sufficient medical evacuation coverage would be vitally important in a case like this.”
You can find travel insurance plans with $500,000 or even $1 million in medical evacuation coverage.
Failing to Navigate Coverage for Pre-existing Conditions
Adamski says it’s important to know that if you purchase a travel insurance plan within 15 days of making your initial deposit on your trip, a pre-existing medical condition exclusion waiver can be included in your policy. This waiver means any pre-existing conditions will be covered by the plan.
You can certainly purchase a travel insurance plan up to 24 hours before your scheduled departure, but don’t miss the purchase window for getting the waiver.
Buying Unnecessary “Cancel for Any Reason” Coverage
If you want the most protection possible for your trip investment, there’s “cancel for any reason” coverage. This add-on will give you the option to later cancel the trip for a reason that’s not listed in the base policy and still get some reimbursement. It adds about 40% to the travel insurance cost.
But many people look to buy this extra coverage for reasons that are already covered by standard trip cancellation insurance, observes Steven Benna, a spokesperson for Squaremouth, a travel insurance comparison provider. Don’t have a blind spot to all the reasons for cancellation that are covered in a standard policy. For example, canceling a trip because a family member is ill is covered by a typical travel insurance plan.
Standard trip cancellation coverage and “cancel for any reason” coverage are separate benefits, “so don’t pay extra for ‘cancel for any reason’ when you don’t need to,” says Benna.
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