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A Happy Traveler's Guide to the Many Types of Travel Insurance

  • Travel Team
Aug 06, 2015

Whether you are a seasoned traveler or leaving the comforts of your hometown for the very first time, understanding the types of travel insurance available to you is a necessary part of your trip planning. Too many people put time and effort into pulling together a trip, but when things go off-track, they are without solutions to help in their time of need. A simple business trip or long-anticipated family outing to a dream destination can be ruined if you do not take the time to protect yourself and those who travel with you.

If only it were that simple, right? There’s a BIG problem we all face when considering a policy — there are almost too many options, or even worse, we can never find the right combination of this or that coverage.

Before you take your chances, give us a few minutes to assure you that the travel insurance industry is not THAT difficult to navigate. It just takes partnering with someone who has the experience and know-how to ease you into the process. Plus, the many types of travel insurance are not as complicated as they can be made to appear, so you will ultimately have the power to make the best choice for your particular trip.

An empowered traveler is a happy traveler, and we hope you leave here happier than you thought possible!

Travel Insurance Starting Points

Hopefully we were your first choice when you decided to learn more about travel insurance. If not, then you may be shaking your head right now. This is by no means a criticism of other people in the industry, but we have found that too many websites and blogs are unable to explain the ins and outs of insurance coverage. That’s where we are different.

The following information is as devoid of useless insurance jargon as possible; we focus on giving you as many details as possible without going overboard or worsening any confusion you might experience. You already have bags to pack, reservations to finalize and so much more; why not allow us to do the heavy lifting here, since you will be the one doing the heavy lifting when you load and unload all of that luggage?!?

The Five Main Types of Travel Insurance

  1. Trip Cancellation/Interruption
  2. Medical
  3. Evacuation
  4. Baggage
  5. Flight
Trip protection insurance by Seven Corners.

 

Each type has its own subcategories, ranging from identity theft to political evacuation to sports-related coverage. Each of the main types, as well as some of their subcategories, will be discussed in greater detail below, but check with your agent to get the fullest policy availability picture.

Please note that these options usually come in combinations with one another, or in a comprehensive, all-encompassing version. Many comprehensive policies include an “any reason” provision that gives the insured at least partial coverage/reimbursement for certain issues outside of a single or combination policy (keep this in mind as we move through the different types of insurance; it’s worth addressing with your agent if you are concerned with preparing for every single issue that might come up). Also, the frequency of your trips might lead you to consider an annual plan — where your premium covers you throughout the year without fluctuations in price or terms.

Speaking of price … obviously each type and plan carries a different pricing structure dependent upon a variety of reasons, including age, destination and frequency of travel. Your agent will search for the best rates based upon these and other factors. Your agent is on your side and will help you find what works best. Someone who deals directly with these plans on a daily basis can provide insights and ideas that you might otherwise overlook on your own. They are ready and willing to answer your questions and give you the tools you need to have worry-free travels and an even better return home.

Trip Cancellation or Interruption Insurance

Stuff happens. It is a harsh reality, but when we move about our country or world, we know there is always a possibility that unforeseen “acts of God” might derail business, pleasure or any other reason for our travels. This type of insurance is not a catch-all for any reason that may keep us home. Primarily, this applies when a traveler or a member of his or her immediate family, experiences illness, injury or death, and the trip is canceled or delayed as a result.

For example here are a few scenario examples in which trip cancellation or interruption insurance covers the insured:

  • If an insured traveler’s mother passes away on the eve of her trip
  • If a business partner is hurt in an automobile accident and is unable to travel
  • If the insured is stuck either due to severe weather, airline employees go on strike, etc.
  • If your tour/travel company changes or cancels your travel itinerary

A comprehensive trip cancellation or interruption policy offers safety from such inconveniences caused by the travel agency or touring company.  In each case, the insured person would be able to seek the benefits of this policy: receive refunds on pre-paid deposits, fees and other expenses.  These and similar situations may or may not be covered depending upon the policy; discuss this with your travel insurance agent before you make a purchase.

Medical Insurance

The name says it all — if you require medical attention, this type of travel insurance will serve you in your time of need. Your health and well-being should not be put at risk because you were out of town during a medical emergency.

Fortunately for many people their personal health insurance may cover them fully — home or abroad. Contact your health insurance provider to see what it does and does not cover when you are on a trip. However, for international travelers, or those with lesser healthcare coverage, it is wise to purchase medical insurance and use it as the secondary “just-in-case” policy. You can use this additional insurance for deductibles or other costs not covered with your health insurance. Since all U.S. citizens will soon be required to obtain health insurance, most of us will have some type of coverage before we travel. However, in this window of time where some of us still have little to no health insurance, a travel medical policy should be considered above all other options in this blog post.

The severity of an illness or injury will dictate the amount of funds you will receive to cover the cost of treatment. For example, if you slip, fall and break several bones, then you may need extensive help, and your insurance policy will be there for you. The amount of reimbursement it based on your insurance deductible. Now, if you wake up with a runny nose and slight fever on day three of a business trip, then you will probably be required to handle the cost of stopping by a doctor’s office. In extreme cases, like going to a war-torn country and/or a place battling a pandemic, you may have trouble getting a policy. Even in these situations, your agent will find options and/or answers before you travel. Important note: illness or injuries that occur during intoxication and/or under the influence of illegal drugs/narcotics are not covered by the insurance policies.

Depending on your trip type, length and origin of travel, the following lists a summary of medical travel insurance benefits that are available to you.

For coverage period and maximums plus to find out what type of travel insurance medical benefits are right for you, please consult with your travel insurance provider.

  • Medical Expenses
  • Medical Evacuation
  • Pre-existing condition coverage for U.S. citizens
  • Pre-existing condition coverage for non U.S. citizens (varies with medical expense)
  • Coma Benefit

Student travel insurance medical benefits:

  • Accident & sickness medical expense
  • Deductible (per injury or illness)
  • Maternity (Liaison Student)
  • Alcohol & drug abuse
  • Injuries from a motor vehicle accident
  • Sports related injuries
  • Emergency medical evacuation
  • Accidental Death & Dismemberment (AD&D)
  • Travel assistance
  • Dependent coverage (Liaison Student)

Expatriate travel insurance medical benefits:

  • Medical coverage inside and outside of the U.S.
  • Preventative
  • Maternity
  • Mental Health Services
  • Travel Assistance
  • Dental (Reside Prime)

Visitor medical insurance benefits:

  • Hospitalization
  • Surgery
  • Prescription drugs
  • Doctor’s visits
  • Dental treatment
  • Emergency medial evacuation
  • Return of remains

Immigration medical insurance benefits:

  • Hospitalization
  • Surgery
  • Prescription drugs
  • Ambulance service
  • Dental treatment
  • Doctor’s visits
  • Travel assistance
  • Accidental Death & Dismemberment (AD&D)

Annual travel insurance medical benefits:

  • Medical expenses
  • Emergency medical evacuation/repatriation
  • Accidental Death & Dismemberment (AD&D)
  • Follow me home coverage
  • Emergency reunion

Evacuation Insurance

Closely related to medical insurance, this type of insurance offers policyholders a way out of a country when he or she is too ill or injured to remain. For example, if a man has a heart attack during his travel, evacuation insurance covers assistance to get to the nearest available and proper medical facility for treatment. Important note: all evacuations have to take the insured’s health condition(s) into consideration before an evacuation is taken action.  This does not mean he will be rushed directly to his hometown cardiologist. There are some instances where there is no other choice than taking the person directly home, but the opposite can be true as well; if a person chooses to participate in activities that could put them in harm’s way (i.e., skydiving, skiing, etc.) without a policy, then he or she will be out of luck completely. Rest assured, for any of these uncommon issues, your travel insurance agent has probably seen it firsthand and will gladly walk you through your decision.

Baggage Insurance

There are few feelings as helpless as arriving to your destination, or finally get back home, and your bags are nowhere to be seen. Airlines and other travel companies have policies in place to reimburse individuals for their lost or delayed possessions. Also, if you have a homeowner’s or renter’s insurance policy, you have another layer of coverage. Fortunately, as a part of most combination or comprehensive travel insurance plans, a third layer of protection is added in the form of baggage insurance. There are limits to the amount of money you will receive to replace your items with this type of travel insurance, so be sure to go over your full set of options with your agent. Here’s an interesting fact: in some cases, you can receive baggage delay care that provides money when your bags are delayed for an extended period of time (12 hours or more).

Flight Insurance

This type of travel insurance goes by many names — flight, flight delay, cancellation or travel delay insurance — but no matter what you call it, when your flight is delayed for a particular amount of time (most policies fall within the 6-12 hours range), you are provided with the needed funds to pay for a hotel room, food and any expenses necessary for rearranging your transportation. Once again, and this cannot be stressed too many times, your agent is your #1 resource to ensure you understand the fine print. In many cases, you will receive reimbursement for any out-of-pocket expenses. So be prepared to pay the amounts brought on by a delay or cancellation, and save those receipts! This will give you proof of what you paid and make it easier for your insurance agent to help you receive the full amount you deserve.


Conclusion

So there you have it, well-informed traveler! Hopefully, you will never use any of the five main types of travel insurance — Trip Cancellation and Interruption, Medical, Evacuation, Baggage and Flight — but it is wise to have a policy in place just in case. There are many potential issues that might happen before, during and after your trip. Hoping for the best and not the worst is not nearly as reassuring as expecting the best, but preparing for the worst

These examples are only the beginning. Do you plan to ski during your trip? Spend time in a third world country? Rent a car once you arrive to your destination? Arm wrestle an orangutan? (Okay, that last one was to make sure you were paying attention.) No matter what’s on your agenda, share every detail with your travel insurance agent. He or she will give you details on policy availability, and though you may not feel you can purchase every policy with every add-on, at least you’ll know your possibilities.

A word of caution:

Travel agents will offer you policies, and though they are knowledgeable, they are not travel insurance agents. Make sure to contact an actual travel insurance agent for travel insurance questions — you’ll be glad you did.

We wish you happy travels and a safe return home. Though selecting the best types of travel insurance packages may take time and resources, it can make a world of difference. Now that you have the basic understanding of travel insurance, you can work with a travel insurance agent who will make the process as easy as possible!

Now is the time to get peace of mind while traveling! Seven Corners offers a wide range of travel insurance plans.

Click below to receive a quote on your upcoming trip!

Peace of mind is one click away.


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