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Travel Insurance Explained
Travel Insurance Explained

Great Sand Sea, Western Desert

Photo by Alfredo De Simone

By Gail Benun

"Someone needs to tell travelers that their regular insurance doesn't help them get home in the event of a medical crisis" - Don Causey, President/Publisher, The Angling Report and The Hunting Report, who was medically evacuated from Kenya at a cost of $123,000 for transportation alone.

The cost of travel is going up. Plane tickets, gasoline prices, accommodation, meals and excursions are all more expensive today than a year or two ago. For families looking for ways to reduce the overall cost of a vacation with kids, travel insurance is oftentimes considered an unnecessary extra. However, travel insurance is the one thing that can reduce, or completely eliminate, unexpected and extraordinary expenses.

When considering travel insurance, emergency medical expenses and last-minute cancellations immediately spring to mind. Yet, there are many other costs that can be reimbursed through a travel policy. Many cover lost and stolen luggage and missed connections as well as natural disasters and severe-weather-related delays and impediments.

It won't happen to me
Travel insurance is no different than fire insurance - a decision to forego either is an assumption of risk. Without travel insurance, you stand to lose much more than cost of the trip. While the cost of a serious accident overseas may be less than the cost of rebuilding the family home, emergency medical treatment and hospitalization as well as out-of-pocket expenses such as phone calls, new clothes, medication, and penalties for changing flights can quickly add up. According to TravelSafe.com, roughly 16% of U.S. travel policy purchasers have filed a claim.

What type of coverage do I need?
The type of family vacation you take will, to a large degree, determine the type of coverage you require. A relaxing beach holiday in Hawaii will presume different risks than a trekking expedition in a remote area of Pakistan. Select a policy that covers the activity you intend to engage in.

The frequency with which you travel will also influence your choice. Families traveling once a year may prefer a policy that covers a specific trip. On the other hand, families that take to the road or the skies frequently may find that an annual policy provides a more comprehensive coverage at lower price.

The starting point for any review of travel insurance, whether for health or safety, should begin with a review of your existing medical, car and credit card coverage. In addition to determining the maximum your insurer will pay, find out if there is a minimum deductible. Read the fine print, and pay close attention to all claim procedures, requirements and deadlines. Incidents that aren't covered will be clearly spelled out. Keep in mind that a family policy likely only covers your spouse and your children.

Buying online?
Traditionally, travelers have purchased insurance through their local broker or their neighborhood travel agent. But, thanks to the internet, an online search is both more convenient and could also lead to cheaper rates. Before you purchase a travel insurance policy on the web, do your due diligence and assess the insurer's credentials. Their license number and membership in national or international travel associations should be readily available on their website. If you have selected an insurer domiciled in a foreign country, make sure it is a regulated by a local insurance board. Use insurance brokerage websites to review insurance company ratings online. And don't hesitate to check references, read testimonials and pose questions on travel forums.

Remember, in the event of a perceived risk the cost of insurance may be small.

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