A Guide To Travel In­sur­ance In­clud­ing When Not To Buy It

Riverbank News - - NEIGHBORHOOD VALUES - By BETH J. HARPAZ AP Travel Ed­i­tor

When you book flights on­line, you’re typ­i­cally prompted to buy travel in­sur­ance. Same with cruises and tours.

Should you buy the in­sur­ance? What will it cover? Equally im­por­tant, what won’t it cover, and when might it not be worth your while?

The AP Travel pod­cast “Get Outta Here!” got the an­swers to these and other ques­tions from Beth Godlin, pres­i­dent of Aon Affin­ity Travel Prac­tice. Aon, a global in­sur­ance bro­ker that rep­re­sents in­sur­ance com­pa­nies, cre­ates spe­cial­ized travel prod­ucts, in­clud­ing in­sur­ance poli­cies sold by cruises, tour op­er­a­tors and cer­tain on­line book­ing sites.

Ex­cerpts from the pod­cast in­ter­view :

TRAVEL IN­SUR­ANCE: WHAT IS IT GOOD FOR?

Typ­i­cally travel in­sur­ance pro­tects your fi­nan­cial in­vest­ment in your trip, to “cover penal­ties and ex­tra costs you would in­cur” if you couldn’t take your trip or if your trip was in­ter­rupted, Godlin said.

For ex­am­ple, say you need to can­cel a trip or head home early be­cause of a death in the fam­ily or be­cause a hur­ri­cane is headed to your beach des­ti­na­tion. This type of in­sur­ance re­im­burses pre­paid ex­penses — flights, tours, ho­tel — as well as ex­penses in­curred be­cause the trip was in­ter­rupted, like re­book­ing fees for new flights. This type of in­sur­ance also cov­ers ad­di­tional costs in­curred if your trip is de­layed — for ex­am­ple, you miss a con­nec­tion be­cause of a storm and need to stay overnight in a ho­tel be­fore catch­ing the next flight out.

An­other type of travel in­sur­ance of­fers health ben­e­fits, typ­i­cally pro­vid­ing “gap cov­er­age for emer­gency med­i­cal ex­penses and also med­i­cal evac­u­a­tion.”

A third cat­e­gory pro­tects “your stuff,” Godlin said, mean­ing what­ever you bring with you or pack that’s not cov­ered by ex­ist­ing in­sur­ance, in case of loss, dam­age or theft.

WHEN WOULDN’T YOU BUY IN­SUR­ANCE?

Buy­ing in­sur­ance should be based on po­ten­tial losses and what you can af­ford to lose.

If you’re stay­ing in a ho­tel that won’t charge you if you can­cel, or you’re tak­ing a trip booked with miles but you can get the miles back with no penalty if you can­cel, you don’t need in­sur­ance be­cause your losses would be zero.

But if you stand to lose your in­vest­ment should you can­cel, can you live with that risk?

Typ­i­cally, in­sur­ance costs 6 per­cent of the cost of a trip. So for $60, you can in­sure a $1,000 trip. What’s your com­fort level on the money? Would you rather spend the ex­tra $60 and know that you’re cov­ered? Or can you live with the pos­si­bil­ity that if the trip falls through for some un­fore­seen rea­son, you could lose most of what you spent on flights and other non­re­fund­able com­po­nents?

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