Travel Insurance Guide

Your Go-To Travel Insurance Guide: What You Need to Know

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There are things covered by travel insurance that may surprise even the most experienced travelers. Most people realize it's possible to buy policies that cover unexpected trip cancellations and potential health crises that might arise along the way. But many travelers don't know it can also cover problems that occur on the way to the airport or the cost of a replacement ticket if your airline fails.  

To understand how you can get such things covered, it helps to understand how travel insurance works. 

What is travel insurance?

At its most basic, travel insurance is designed to limit potential worst-case-scenario risks and financial losses that could happen while traveling. The risks range from minor inconveniences such as missed connections and delayed luggage all the way to more pressing issues including injuries or major illness. Although what's covered varies, the policies typically come in two modes — cancellation insurance and medical insurance.  

Cancellation insurance

Cancellation insurance policies typically cover problems that may occur immediately before or during your travels. That can include the need to cancel a trip due to illness, missing a flight because of an unforeseen circumstance or having to shorten your trip. If you have to cancel a trip, most policies will cover pre-paid, non-refundable purchases ranging from airline tickets to package tours. 

There are some common-sense exceptions, according to Megan Freeman. As she puts it, "If you overslept and missed the flight, that is generally not covered." 

Cancellation insurance may also include travel delays as well as luggage problems, such as lost or stolen bags, or delayed arrival. In most cases you'll have to pay the expenses up front and get reimbursed later. 

One thing you should know immediately -- U.S. health insurance doesn’t cover international illness. Your insurance may cover you if you're traveling and need treatment in the U.S., but if you get sick overseas without travel insurance, you'll likely have to pay for treatment out of pocket. 

Medical insurance

Medical insurance typically covers costs up to a certain amount for emergency treatment including accidents and major health problems. 

What's covered in medical travel insurance can be confusing. If you have a pre-existing condition, for example, you must declare it at the time you buy the insurance, even if the illness isn't covered. If you fail to do so, your entire policy can be invalid. 

Many companies offer comprehensive plans that combine aspects of trip cancellation and emergency medical insurance. The policies include travel assistance, too. 

Affordable Coverage

Considering how quickly costs can add up, the coverage can be surprisingly affordable. The price tag is based on the cost of the trip and the age of the traveler. So, a 35-year-old might expect a policy to add 3% to 5% to the cost of a trip while a 60-year-old might pay around 10, says Jonathan Haraty, owner of a MA-based travel agency. It can be a small price to pay to safeguard your investment in a honeymoon or the trip of a lifetime. 

Because so many companies offer travel insurance, it's important to read the fine print, paying special attention to what's excluded, experts say. That way you'll know what's covered up front and won't be unpleasantly surprised if you need to file a claim later. 

What you don’t know might help…. or hurt

Medical evacuation coverage is just one of the travel insurance details travelers might not know about. Here are a few more worth mentioning: 

Medical evacuation coverage takes your protection to the next level, insuring your transportation to a medical facility or to your home country for treatment, depending on your policy. If you’re in a country where you don’t speak the language, it could include translation services to explain what medical professionals are saying and provide a way to communicate with family members back home. In a worst-case scenario, it would cover the cost of transporting your body home if you die while you are traveling.

In "The Beginner's Guide to Travel Insurance," the travelinsurancereview.net website recommends buying when you book your trip to get maximum benefits including the opportunity to get "cancel-for-any-reason" insurance and coverage for weather-related events.

If you leave home a day before your trip starts so that you can stay overnight near the airport or cruise terminal, you should start your coverage on that day, Haraty says. Otherwise, if your car breaks down and you miss your departure, it won't be covered. 

If you hear there's a tropical depression or blizzard forming near your destination, coverage may still be available until the storm is strong enough to get a name, Haraty says. 

Don't forget to include your kids' names on your family travel insurance or they may not be covered.

You may also be able to purchase additional specialty coverage for everything from extreme sports to work-related issues, according to Lisa Leavitt, travel agent in Newton, MA.. "If you are worried that your boss will decide to need you [at] the last minute, forcing you to cancel your trip, you can get special coverage for that," Haraty adds. 

For more information on travel coverage and the different options available, visit Nationwide’s travel insurance page before heading on your next trip.

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