Travel insurance 101: What do you need and where do you buy it?
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Your summer vacation is booked and you’re about to buy insurance to cover that trip. But you still have some unanswered questions, including: What type of travel insurance do I need, where should I buy it, and how much should I spend?
Rather than buy insurance that you may not need, it’s a good idea to first figure what you already have. To start, here are two things you should research before buying travel insurance:
What does your health insurance cover? If you’re traveling within the United States, there’s a good chance your health insurance plan will cover some and maybe all of the medical expenses that you may incur if you become ill or injured during your travels. But, if you’re traveling abroad, many health insurance plans will only pay for emergency room visits. Other plans won’t cover any medical expenses at all. To boot, your health insurance won’t usually pay to fly you out of the country if you find yourself seriously ill in an underdeveloped nation. With one phone call to your health insurer, however, you should be able to sort out what coverage you need.
Does your credit card company offer travel insurance, and what type? Most credit card companies provide some type of travel benefits, including insurance. To this end, credit cards typically only offer trip cancellation and lost baggage as part of their basic benefits package, says Lynne Peters, insurance product manager at InsureMyTrip. Some cards do offer more extensive benefits and this is why you’ll want to call your credit card company.
After you determine what coverage you already have, you should then consider the nature of your trip and your destination. A vacation to visit friends at their beach house three hours away probably doesn’t warrant spending money on travel insurance. Yet, if you’re traveling overseas or going on a cruise, purchasing travel insurance is a wise move.
Once you’ve decided to buy travel insurance, it’s time to figure out where to purchase the best coverage at the lowest rates.
Indeed, there are many insurance companies to choose from and there are more policy options - at all price points - than ever before. You could start by calling insurance companies directly for quotes, but you’ll save time and money by comparing travel insurance costs online. You can enter your trip and personal details to compare policies and pricing from dozens of insurance companies. You can even customize particular benefits to make sure you end up with the best policy for your needs at the lowest price. For example, if you only want to buy trip cancellation and interruption, you can narrow your search down to just these specific coverages.
Since there are so many coverage options available and insurance can get confusing, our advice is to go with a comprehensive policy. This will cover you for trip cancellation and interruption, lost and delayed baggage, and medical costs. Comprehensive insurance is also more affordable than you may think, costing about four to eight percent of your total trip cost. Sometimes you’ll find a policy for even less than that.
As an example, a comprehensive policy found on InsureMyTrip for a $4,000 one-week vacation to Belize for a 30-year-old traveler starts at $98.20. This includes $4,000 for trip cancellation, $5,000 for trip interruption and $75,000 in secondary medical coverage (secondary coverage means the travel insurance will kick in if you don’t have other applicable primary insurance).
Because the price is right and the benefits are extensive, 80 percent of InsureMyTrip’s customers buy comprehensive policies, says Peters.
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