Travel Insurance vs Travel Protection
I brought this up in another post, but thought it would be a good idea to provide some information about this subject. I hope this is a good place to post it.
Most travelers purchase travel insurance because of many reasons. But one very important thing they may not be aware of when looking at 'travel insurance' offered by some of these online sites and travel agencies. Often, it's not travel insurance, it's travel protection and there is a HUGE difference in the two. First of all, travel protection is not policed by your State's insurance commission. Second, the coverages are usually alot less and there are alot more 'exclusions' in those policies.
Here's an article I wrote about the differences and why it's important to know and understand what you're getting:
We've talked alot about travel insurance and it's something I always recommend. But I highly recommend it under these circumstances:
1) Traveling during the Winter - obvious travel delays.
2) Traveling during hurricane season - doesn't need explanation.
3) Anytime traveling to foreign countries - lots of lost baggage and possible health problems.
4) Traveling with children - common illnesses and injuries that can occur before or during the trip.
5) Traveling with seniors - as with children, there's a higher possibility of illness or injury.
6) Traveling with pre-existing health conditions - could crop up before or during the trip. (Keep in mind most companies require that you purchase travel insurance before final payment in order to be covered for pre-exisiting conditions.)
When looking at buying travel insurance, I always hope it's a waste of my money, because if I need it, then it's usually not a good thing. But It's always best to have it and not need it, than need it and not have it.
A friend of mine who's also a travel agent had a client who's worse-case scenario became reality. The client's husband had a heart-attack and ended up in a foreign hospital where he was in a coma for a month before he died. Total bill was around $100,000! Luckily, she had travel insurance and was covered for all the expenses.
So, there's no question we always purchase the travel insurance whenever we travel and just hope we never need it.
Unfortunately, we did have an occasion where we needed it and we were sure glad we had it. Our son, who was not going with us, got sick the day we were leaving on a two-week European trip that included a 7-night river cruise. We had to cancel our trip because he had to have his gall bladder removed. The insurance reimbursed us for all of our out-of-pocket expenses.
I won't go into all the reasons why you need travel insurance and what it covers. Obviously, it's a personal thing as to whether to get it or not. For example, some health insurance companies provide excellent coverage and some don't provide any. For me, if I'm taking an expensive vacation worth several thousand dollars, insurance is worth the protection it provides. I'll just say one thing; I have a client who told me if anyone is thinking about not buying it, have them call me and I'll convince them it's a good thing. He & his wife planned for 2 years to do a wonderful 2-week Alaskan cruisetour. They were going first class all the way and had a big suite on the ship. Total cost; $10,000! Two days before they were leaving, his wife, who is a high school teacher, had a big kid step on her foot leaving from the last class before Summer vacation. It was broken in three places and the doctor told her she could not walk on it for 8 weeks. Luckily, they had the travel insurance and it covered 100% of their out-of-pocket loss.
But let's get back to the subject at hand. The one thing that no one talks about is the difference between travel protection versus travel insurance.
What's the difference? Trust me when I say it can be a HUGE difference!
Do not buy travel protection - it's not the same as travel insurance. Don't assume that what you are buying from your agent is travel insurance. Make sure you read the policy before you buy it and find out if it will cover you in the situations of most concern to you that might arise during your trip.
There was a story on our local news that I thought would help explain it the best. Unfortunately, it's no longer available on their website, but basically here's what it said:
A couple purchased travel protection through their travel agent for their Mediterranean cruise worth over $6800. The husband injured his knee playing golf and had to have surgery. Needless to say, they had to cancel their trip. (The exact same thing happened to me playing golf and I, too, had to have surgery!) Even though they had all the documentation from their doctor showing he had to have the surgery and could not travel, this was considered 'elective surgery' by the travel protection company, so they denied the claim and the couple lost all their money. And because this was not sold or advertised as travel 'insurance', there was nothing the State insurance commission could do about it.
A company selling travel protection is not required to get a State license to sell insurance, so the laws governing insurance do not apply to protection policies and you're on your own if you have any problems.
Here's another story that you'll find interesting; http://www.nytimes.com/2009/06/28/your-money/28haggler.html?_r=1&emc=eta1
Bottom line, always buy travel insurance not travel protection, but ask questions, read the policy, and make sure you know exactly what you are getting. And don't assume a big name means best policy - it ain't true! Some of the biggest problems we've had with companies have been some of the biggest names in the business. At one time, we were selling policies from 5 companies, but ended up firing 3 of them because they did not provide good customer service to our clients. All three of these were among the biggest in the industry.
As for the insurance offered directly by the cruise line, it is insurance they are offering from an insurance company. But compare not only the price, but also the limits of coverage. Often times you'll see the amounts they are covering is considerably less than other policies that are better and cost less. Also, make sure it covers everything, including having to cancel for accidents or illness of immediate family not going on the trip. Some cruise line's policies do not cover your independent airfare. Some cruise lines will provide credit towards another cruise instead of providing a cash refund.
And lastly, ask questions! Don't assume the travel agent has all the answers - most are definitely not experts in insurance - it's just something they sell as a service to their clients. If you have questions, the best thing to do is ask the insurance company directly. And if there is a specific situation that you're concerned about the most, make sure you get the information in writing directly from the insurance company.
In closing, I always recommend travel insurance. And almost always, it's better through an independent insurance company than through the cruise lines. As I said, I never needed it in 42 cruises, but it was that one time I was really glad I had it or I would have lost about $5,000. Don't know about you, but I can't afford to lose that kind of money.
I never travel internationally without full travel insurance, including unlimited medical and collision damage for hired cars. For internal travel, I sometimes just buy the airline's cancellation insurance, depends on the circumstances.
If you'll be hiring a car for any length of time, the collision damage waiver often costs more than a full insurance policy that includes collision damage. Check the waiver costs before you travel - they're not usually prominently displayed on the website/advertising. For one or two days it's not a big cost but for a week or more it often comes to an outrageous amount.
One other point - it's a good idea if everybody in your party is on the same policy. When I was on a holiday with a friend and her son, my friend became ill. She had said she wasn't going to get travel insurance as it was too expensive, but I told her I wouldn't travel with her unless she did, so she got it and was glad she had it! Anyway my policy wouldn't cover any deviations for me to care for her or her son, since we weren't on the same policy. She was way too sick to look after her son, and I was worried how she'd manage on the flight home. I managed to send her son back home unaccompanied to his Dad so at least we didn't need to worry about him, and then it was a bit tense seeing if she'd be discharged from hospital in time for me to help her on the flight home. I ended up missing one flight and out of pocket by about $200, then we made the connecting flight OK as we'd had an overnight layover on our original itinerary.
I'm always confused as to who would be liable. For instance I'm thinking of hiking to everest and they warn you it is common for delays out of Kathmandu due to weather. Three days later I'm planning on doing a cruise out of rome which I got insurance for through the cruiseline when I booked.
If I miss the departure and need to catch the ship would the insurance pay as it was a weather delay getting me there? Or do I need a separate policy for the flight because it's the one getting delayed? :confused:
As for whether or not it would be covered, it depends on the cruise line and the insurance you purchased.
But this is exactly one of those things where you need to discuss it directly with the insurance company as no one here can give you a definitive answer about it. Calling the cruise line will not get you the appropriate answer, so don't even go there as they are not insurance experts.
Just read your article regarding insurance vs. protection. Our family is cruising in Dec. 2012. We have already purchased "Travel Protection" thinking this was insurance from TraveLex. We have used them for all 4 cruises. Thankfully we have never had to use them. When I read some of the document I felt as if anything that could possibly happen was covered. Does the protection policy protect less when one does not go on the trip as opposed to sickness or injury while cruising? I cannot cancel as, per more reading, the 10 day cancelation term has already passed.
We are on a 7 night Eastern C. cruise. Our group is Myself, wife, 2 sons. Our total protection cost is roughly $130 for a cruise that cost roughly $2300.
What would be an estimated cost for insurance instead of protection and what is the best way to determine what someone is purchasing.
Thanks for all assistance.
There are basically two different reasons to cancel; one is for a covered reason, such as accident, illness, weather, etc. The other is for 'any reason'. It really depends on the policy, what it allows, and how much it will pay for the two reasons. The first reason is covered at 100%, whereas the second reason, if covered, usually covers anywhere from 75% to 90% depending on the policy.
Some policies do not cover 'cancel for any reason' or CFAR, whereas some do.
A policy purchased through Travelex does not include CFAR unless you specifically purchased it, which is a higher price.
Personally, I never liked Travelex, but that's just me.
You really need to discuss this with your agent as anything I can add would be pure speculation on my part since I don't know the specifics of your policy or your specific situation.
And the 10-day cancellation period you mentioned only reflects the time which you have to cancel the policy and get a full refund for the policy. It has nothing to do with cancelling the cruise.
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