CLEVELAND, Ohio – It’s been a tough year for travelers.
From State Department travel warnings to terrorist attacks to catastrophic hurricanes – the travel world is awash with worries, both real and imagined. What’s a weary traveler to do?
Increasingly, the answer is travel insurance.
More travelers than ever are opting to insure their trips against unexpected cancellations, health concerns and other issues, according to the U.S. Travel Insurance Association. In 2016, 42.6 million Americans bought travel insurance – an increase of 24 percent from two years before. This year, that number is likely to climb even higher.
The reasons are myriad: We’re traveling farther from home, we’re spending more money, we’re worried about our health and the health of our loved ones. We’re concerned about catastrophic weather events, terrorist incidents and new diseases.
“I wouldn’t travel without it,” says David Cunix of Mayfield Heights. “It gives me peace of mind.”
Cunix recently responded to an invitation to readers to share their experiences with travel insurance: Do they buy it, why or why not, and have they used it? Cunix, who owns an insurance agency, admits that he has “a dog in this fight.” He sells a small number of travel insurance policies every year, but he says that’s not why he buys it.
“The big thing that a travel policy does is it gives you an advocate,” said Cunix, who travels regularly to Mexico and the Dominican Republic and always worries about weather delays to and from Cleveland.
Recently, a client hurt his wrist on a trip to Thailand. A representative from the company found him a doctor and scheduled an appointment. “It was easier for him to get an appointment in Thailand than it would be to get one at the Cleveland Clinic,” said Cunix.
Not every traveler, however, needs insurance.
Need some help deciding?
Most domestic travelers probably don’t need insurance, unless a large portion of their trip is nonrefundable (a vacation home rental, say, or a Mississippi River cruise).
Many credit card companies offer some coverage — for lost bags, accidents and other issues — though it’s important to research the details.
In general, travelers who are older are more likely to buy, in part because they’re more likely to face health problems, but also because they’re more likely to spend more on travel.
“The farther somebody travels, the longer somebody travels – the more likely they are to buy travel insurance,” said Beth Godlin, president of Aon Affinity Travel Practice, which sells travel insurance plans to tour operators and other providers.
InsureMyTrip.com, a travel insurance comparison site, offers these tips to travelers on the fence about insurance:
* Are you traveling abroad, or more than 100 miles away from home?
* Are you hyper-aware of the cost of your travel arrangements?
* Are you concerned an illness or injury to you or a loved one may affect your trip?
* Are you traveling during a heightened risk of severe weather, like the holidays or hurricane season?
* Does your trip include prepaid home rentals, car rentals or event tickets?
Steve Dasseos, founder of TripInsuranceStore.com, can make the calculation even simpler, narrowing down the decision to two main factors:
How much money will you lose if you have to cancel your trip? If it’s more than you can bear, then buy insurance.
And do you have health insurance that covers you when you travel out of the country? For example, Medicare, in general, does not. If the answer is no, it’s wise to buy medical coverage, if nothing else.
Helen Gisselbeck of Willoughby can attest to its importance: “We were on a riverboat cruise from Bucharest to Budapest a couple of years ago, and unfortunately I fell from the steps of the bus and broke my hip. It was a nightmare, but without trip insurance, it would have been a financial disaster.”
Her insurance company paid for her hospital care, her husband’s stay at a nearby hotel, and their first-class flight home. “We tried to figure out what it might have cost us out of pocket, to take care of all these problems and we know it would be thousands and thousands of dollars – plus all the headaches of not knowing what to do in an emergency like ours.”
Finding the right plan
Once you decide you want travel insurance, the next step is deciding what kind. There are dozens of companies that sell it, and every policy is a little bit different.
This is not the time to skim the fine print, said Dasseos, who has heard too many clients say, after the fact: “But I assumed it would work this way…”
If there’s something you don’t understand, he said, ask.
“It’s far more complicated than health or life insurance,” said Dasseos, a former financial planner. “It’s surprising that anyone is able to get through it on their own.”
There are three primary areas of coverage, which typically can be purchased separately or together:
* Trip cancellation and interruption insurance, which allows a traveler to cancel a trip or cut it short for a variety of specified reasons: sickness or injury (for you, a traveling companion or family left behind); loss of job; weather or natural disaster; terrorist attack. But the devil is always in the details: Hurricane coverage kicks in only if your destination is under a hurricane warning; coverage for a terrorist attack only applies for a limited period of time after an attack in a specified place.
* Medical insurance and evacuation insurance, which cover travelers if they get sick or injured while traveling – and brings them home if necessary. Some policies allow for pre-existing conditions, many do not. (And in all cases, if pre-existing coverage is needed, it must be purchased shortly after travel plans are made, not right before the trip.)
* Cancel-for-any-reason policies, an increasingly popular option that allows travelers to cancel for reasons not spelled out in other policies – travel warnings, for example, fear of contracting the Zika virus or bad weather that doesn’t rise to hurricane status. It is typically considerably more expensive than a traditional trip cancellation policy, up to 50 percent more, said Dasseos.
The price of any policy depends on numerous factors, including the travelers’ ages, price and length of the trip. Typically, travelers can figure to spend anywhere from 4 to 8 percent of the nonrefundable cost of their trip, according to InsureMyTrip.com.
One example, provided by InsureMyTrip: A couple in their 50s planning a two-week, $5,000 vacation to Aruba could expect to pay about $200 for a comprehensive policy with a $50,000 medical limit and up to $250,000 for medical evacuation.
Buying it at the right time
In addition to cost, travelers have to consider timing when buying insurance. As with any insurance, you can’t buy it after you realize you need it – as a hurricane is bearing down on your vacation home or after you trip and fall on the stone steps in Southern Italy.
“The premise of insurance – any insurance – is that it is designed to cover unforeseen or unexpected events,” said Godlin. “You can’t get into a car accident and call Geico. You can’t see a hurricane headed for St. Thomas and get travel insurance. It’s no longer unforeseen.”
Travel insurance, by the numbers
Aon Affinity reports that it processed more than 8,300 claims related to four recent hurricanes: Harvey, Irma, Jose and Maria. Seventy-two percent of those claims were related to Hurricane Irma, according to the company.
Allianz Global Assistance USA processed 60 claims related to the August terrorist attack in Barcelona: 44 cancellations and 11 interruptions (meaning, the traveler changed plans in the middle of his trip). In one case, the insurance company paid to have a customer’s luggage moved “from a hotel near the attack to another hotel, away from the incident,” according to Allianz.