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Medical conditions, baggage delays and oversold flights are a few of the unforeseen events that insurance can cover
Don’t let your paradise vacation become a trip from hell.
Memorial Day weekend kicks off the summer vacation for many — but hurricane season also officially begins June 1, bringing the potential to wash out your best-laid plans. With Hurricanes Irma, Harvey and Maria wreaking havoc on trips for millions last year — not to mention costing more than $200 billion in damage and taking hundreds of lives in the U.S. alone — the number of people taking out travel insurance is expected to skyrocket this summer.
According to AirHelp, a company that helps air passengers secure compensation for delayed, canceled or overbooked flights, more than 41.5 million Americans are expected to travel for Memorial Day weekend. And over that same weekend last year, more than 8,500 flights were disrupted, impacting more than 825,000 U.S. air passengers.
Licensed travel insurance agents at InsureMy Trip, an online insurance comparison site, expect a 20% jump in call volume from travelers seeking insurance protection this year, just from fear of hurricanes alone. And although the top concern of summer travelers is bad weather, other unfortunate circumstances such as illness or lost luggage can derail a trip and leave you on the hook for any non-refundable charges. Depending on the items you have packed in your luggage and the price of the luggage itself, losing that alone can ding your wallet. Or suppose you have an emergency appendectomy and can’t fly to your destination as planned — airlines and hotels aren’t forgiving if you’ve booked non-refundable services.
Your credit card might handle some incidentals. Matt Schulz, senior industry analyst at CreditCards.com, told Moneyish, “There are plenty of cards that offer coverage and you don’t need to have one of those high end, $500 annual fee cards.” When it comes to credit cards, Schulz says, “It’s hard to go wrong with the Chase Sapphire Reserve or Chase Sapphire Preferred cards. They both offer up to $10,000 of reimbursement and they offer other travel perks. The Reserve card gives you lounge access, a travel credit, a credit for joining TSA Pre-Check and it gives you 3x points on dining and restaurant purchases — it’s a tough card to beat.”
Some Citi cards consider job loss as a veritable reason for trip cancellation, and will also cover miles or points used to book a trip as long as some portion, like taxes, are paid with the credit card. “I tend to recommend the Citi Double Cash card a lot and it offers $5,000 of trip cancellation insurance per traveler per trip,” said Schulz. With certain Citi cards, delays or cancellations due to lost passports or oversold flights are also covered, as are companions traveling with the cardholder.
But not all cards are created equal, and most only cover travel up to $10,000. Though that might sound like a lot, when you’re booking a cruise, an African safari or a first class, five-star vacation, chances are tens of thousands of dollars are on the line. And even if you think your credit card has you covered, taking out an insurance policy can still be beneficial because it also handles canceled flights, damage to destinations and the destruction of homes.
Laura Schy, a certified travel consultant, told Moneyish, “The premium is usually 10% of the total cost of what you’re insuring.” If your airfare and hotels amount to $8,000, forking over $800 to potentially recoup the entire $8,000 makes a lot of sense.
Which is why if you’re booking a trip with a travel agent, they’ll likely encourage you to take out travel insurance. Schy said, “Travel insurance is worth it on trips where a large amount of nonrefundable money is at stake.” She advises clients to buy insurance on cruises or trips taking place around the holidays, in particular, because vendors typically require prepayment — and that money often becomes non-refundable months in advance.
And while policies will typically cover severe weather, medical expenses, trip cancellation or interruption, lost baggage, baggage delay, medical evacuation and strike — it’s important to read the fine print, because policies vary and some don’t include coverage for weather or preexisting medical conditions. “You have to be mindful if you have a preexisting condition that might come into play — you need to take the insurance out within 15 days of making your deposit on the trip, which is something people are often unaware of,” Schy said.
If you’re booking travel on your own, InsureMy Trip offers tools to help travelers select insurance plans tailored to their travel. Julie Loffredi, travel editor for InsureMy Trip, told Moneyish, “We offer over 1,000 plans from 30 different insurance companies. The most popular option is a comprehensive travel insurance policy that provides a variety of benefits including medical coverage, emergency travel services, baggage protection, trip cancellation and trip interruption coverage.” Prices range greatly depending on the cost of each trip, but users can get an idea of how much they’ll have to spend by filling out their online questionnaire.
The bottom line: It depends on how far you’re traveling and how much of your money is at stake. “If you’re heading on a weekend getaway a few hours away from home, you can likely pass on travel insurance,” said Loffredi. “But if you’re about to plop down a hefty payment on a trip, or you’re heading abroad, consider insurance. If you care about protecting your trip investment — it’s a smart move.”
Lastly, in order to avoid any insurance claims issues, before you travel, Loffredi suggests always keeping your receipts, a copy of your policy number and the correct phone numbers for your travel insurance company close by in case you need to file a claim.
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