4 Reasons Travel Insurance is a Good Value
Travelers are understandably reluctant to ‘waste’ their money on travel insurance especially when the cost of airfare, gas, and lodging is so high these days.
Insurance plans are something we purchase to protect us from significant financial harm should something unexpected happen. Homeowners insurance protects you when your home is destroyed by fire or a tree falls on your roof. Automobile insurance protects you when you have a traffic accident. And Travel Insurance protects you when something unexpected happens before or during your trip: kids get sick, hurricanes strike, flights are delayed, businesses go bankrupt, and more.
Of course, travel insurance is just like any other form of insurance you buy. It comes with terms and conditions and exclusions, and it pays to understand your policy before you commit to it.
Let’s take a look at 4 reasons travel insurance is a good value for your money.
1. Medical care isn’t cheap anywhere
While the cost of medical care is highest in the U.S. and Canada, medical care isn’t really cheap anywhere else either. There is no shortage of travel horror stories where the emergency room in a foreign country demands a credit card before treating a traveler beyond basic life-saving measures.
This is one area where travel insurance can prove to be a very good value.
As an example, a 42-year old traveler with no pre-existing conditions headed to Belize for a week would pay less than twenty bucks for $50,000 in medical coverage. When an emergency room trip can cost as much as $5,000 or $10,000 (even in Belize), it’s easy to see how a small investment in travel medical can prove to be a good value later.
2. Emergency evacuations are very expensive
Emergency medical evacuation coverage isn’t just for those who are snowboarding the backcountry, or SCUBA diving off a remote shore, or climbing Mount Kilimanjaro. It may be the farthest thing from your mind when you’re planning that vacation or business trip, but if you have to be medically evacuated off a cruise ship, off a mountain, or out of a remote village just to receive adequate medical care, you could easily be facing hundreds of thousands of dollars.
This is one area where travel insurance coverage can help your family too!
In many cases, the family of a patient who didn’t have travel medical coverage simply wants to get the injured or ill traveler home so they are close to home as well as being back inside their health insurance network. An emergency medical evacuation is often the only way to stop the medical bills from continuing to climb to reach an amount that cannot be paid in a lifetime.
3. Accurate predictions of the future are hard to get
When you’re planning your trip, you aren’t planning to have to cancel it, but that’s the reason you buy insurance - to protect yourself from the unknown. Every year, travelers have to cancel their trips for lots of reasons, including:
Whether you’re planning the once-in-a-lifetime trip around the world, or a simple birthday getaway, cancelling that trip could cost you hundreds, even thousands, of dollars in airfare, nonrefundable lodging, pre-paid transportation, and other trip costs.
Here’s another example: let’s say you and your spouse are taking a two-week Alaskan cruise at $3,500 per person with airfare costs of $428 per person - your total out of pocket pre-paid trip costs are nearly $8,000. Covering that trip would cost you just a couple hundred bucks.
If your daughter is in a car accident, or your mother falls ill, or the roof on your house blows off in a tornado, you’ll find that ‘extra’ $231 an awful good value.
4. Credit card travel protection is limited
Many credit card agreements include travel protections like these as part of your annual fee:
These travel protections are essentially identical to what you’d get with a travel insurance plan and come with the same limitations you’ll have with a travel insurance plan. For example, the baggage coverage is secondary to what the airline will pay you if they lose your bag, and there are maximum payouts and per-item limits.
It’s important to note, however, that your credit card travel protection is not likely to cover travel medical or emergency evacuation. Also your credit card travel protection, while better than nothing, is not going to help you if you have to cancel your pre-paid beach rental in the Bahamas due to a hurricane.
Get the best value by comparing travel insurance plans
While most travelers are concerned about the cost of travel insurance, it turns out it’s not all that expensive when you compare it to having to pay out of pocket for a medical emergency in a foreign country, or an emergency medical evacuation out of Mexico, or cancel your trip when you’ve lost your job.
A travel insurance comparison tool can help you sort through the plans and qualify them based on the benefits you need at a price you can afford.
Damian Tysdal founded Travel Insurance Review in 2006 on the belief that travel insurance should be easier to understand. Their Travel Insurance 101 is an easy to understand tutorial that explains travel insurance and makes it easy to choose the right plan for a business trip, a vacation, or to live abroad.