Have you ever thought about travel insurance? With the recent attacks and the Zika virus outbreak, you may be wondering if you should insure your next trip. But what does insurance really cover? And, is the extra cost really worth it?
What does it cover?
Travel insurance usually will reimburse your expenses if (1) you or your travel partner get sick or injured and can no longer travel, (2) if something comes up that is beyond your control and you can no longer make your trip, or (3) you get sick while traveling.
The most important part of it all is to read and understand the fine print. If a circumstance is not written in black and white, then it’s not covered. So if you’re buying travel insurance and get sick abroad, don’t expect to be covered for it because that type of protection is usually an add-on to the coverage.
What doesn’t it cover?
Any pre-existing medical conditions are usually excluded, so again, make sure you read the policy to see what “pre-existing” entails.
How much does it cost?
Each travel insurance company is different, and the amount is based on age, the number of people insured, destination, and length of stay. According to Laura Adams, a senior analyst for insuranceQuotes.com, the average amount is anywhere between 5 to 15 percent of the total cost of your trip, with an average deductible of about US$200.
Travelers tend to think that they can cancel a trip for any circumstance, but unless your fine print says so, that’s definitely not the case. And even if your plan allowed for “any type of reason” cancellation, the premium would be 20 to 50 percent higher. Make sure you understand what percentage of the trip will be refunded, and if it will be refunded back to you as an applied credit for the future, or as cash back to your card.
How sick is sick?
You have to be sick enough that you need to go see a doctor, which he or she must verify. And if your travel partner gets sick, you’re covered as well.
The same goes for death or illness in the family for which you need to cancel the trip for. For instance, if a relative passes away, travel insurance should cover you for that.
How about the weather?
In order for you to be covered for bad weather, you must suffer some sort of loss such as a delayed or canceled flight. If your destination was severely damaged by bad weather, your travel insurance should cover that as well.
What about diseases or terrorism?
Most likely travel insurance won’t cover disease outbreaks or terrorist threats. If you’re unsure, purchase the policy that allows you to cancel no matter the reason. Or, maybe reconsider the destination you’re planning on going to.
What if I want to cancel for any reason?
You should then think about purchasing a policy that allows you to cancel no matter the circumstance, however, be prepared to pay up to 50 percent higher. You’ll also want to insure the full trip, buy it within 14 days after the first date of deposit, and allow at least 48 hours prior to day departure to cancel. For the most part, you should get back at least 75 percent of the total cost (some even have cash caps), but compare insurances to see which one offers you the best deal.
Is it worth it?
It all depends on the flexibility of your arrangements such as hotels. Some hotels offer cancelations up until check-in day, which you won’t really need coverage for if something does happen. But for those places where they don’t offer such luxuries and you do pre-pay, consider adding that as part of your travel insurance coverage.
You should also consider the duration of your trip and how far in advance you’re booking. If you’re buying a trip that you won’t go on for another year, then purchasing travel insurance may be a smart thing to do, as you never know what can happen in a year. Don’t forget your credit cards! Many offer added benefits such as trip cancelation and lost luggage.
(This article first appeared on Money.com.)