Travel doesn’t always go as expected. In the age of COVID-19, we know this all too well.
As the pandemic continues to disrupt and cancel vacations, many people are taking steps to try to minimize the challenges posed by changes to travel plans. Data suggests the pandemic prompted more Americans to purchase travel insurance, or at least consider it.
But with so many people unsure about buying travel insurance, mistakes are bound to happen. We asked experts to share the most common mistakes people make when buying travel insurance, as well as their tips for maximizing coverage and minimizing costs.
Waiting too long to buy it
“Travel insurance is designed to cover unforeseen and unexpected situations,” said Megan Moncrief, marketing director at travel insurance comparison site Squaremouth. “That’s why it’s important to take out a policy before an event occurs that could impact your trip.”
For example, she said, you might be concerned about hurricanes if you book a Caribbean cruise in early September. “It would be important to purchase the plan before the weather event, particularly before the storm is named,” Moncrief said.
The sooner you purchase your travel insurance, the more protection you will have.
“It’s best to purchase travel insurance immediately after making the initial deposit, such as when booking flights or a hotel stay,” said Jeff Rolander, director of claims at travel insurance startup Faye. “Generally, to access the full range of benefits under your policy, you should purchase travel protection within 14 days of making the initial trip deposit.”
Not verifying your credit card benefits
“The biggest mistake is buying insurance you don’t need or buying too much coverage,” says Andrea Woroch, a money and budgeting expert. For example, she notes that many people don’t realize that rental car insurance is often included in their car insurance policy or credit card.
Check your credit card information to see if there are travel insurance benefits. If you book your trip with that card, you will be eligible for those benefits and will not need to purchase a separate travel insurance policy.
“It’s important to understand what type of coverage a credit card offers, which may include delayed baggage, lost or damaged baggage, trip delay, cancellation or interruption, medical treatment or evacuation, travel accident and/or rental card insurance,” Woroch said.
If you travel frequently but have a credit card that doesn’t offer travel insurance, consider getting a new card to help you cut insurance costs. Woroch suggested comparing travel credit cards at sites like CardRates.com.
He pointed to the Chase Sapphire Reserve card, which includes trip cancellation and interruption insurance of up to $10,000 per person and $20,000 per trip (plus trip delay insurance, baggage delay insurance, lost luggage insurance, rental car insurance and travel accident insurance). Woroch noted that the Southwest Rapid Rewards Plus credit card offers similar benefits.
“You may even have travel insurance across multiple memberships without realizing it,” she said. “For example, AAA’s Premier Membership plan offers robust travel coverage that includes up to $1,500 in the event of trip interruption or delay and lost baggage coverage for up to $500.”
Before purchasing travel insurance, check out the benefits offered by your credit card. (Photo: Kittiphan Teerawattanakul / EyeEm via Getty Images)
Buying the wrong policy for your needs
Not all travel insurance policies are appropriate for all situations.
“When purchasing travel insurance, it’s important for travelers to have a clear idea of the specific concerns they have about their trip and the type of coverage they’re looking for,” Moncrief said. “Especially in the wake of the pandemic, we’re seeing a new group of travel insurance consumers who aren’t as familiar with the product.”
In fact, purchasing travel insurance requires some thought and research. Before paying high prices, think about what you do and don’t need it to cover, and consider calling a professional if you’re still unsure.
Overlooking the fine print
“Another big mistake is not knowing what your travel insurance covers, as most people don’t read the fine print,” Woroch says. “So do your research, otherwise you may think you’re buying something you don’t.”
Remember that travel insurance is like any other type of insurance, so it does not cover everything.
“Read your plan document when you buy travel insurance,” said Angela Borden, product marketing strategist for travel insurance company Seven Corners. You’ll have “a better understanding of your benefits, which can eliminate some of the frustration of filing a claim and realizing your situation isn’t covered,” she said. And “you’ll know what actions you need to take, such as filing a claim within a certain time frame.”
Paying more than necessary
The correlation between price and value exists in the insurance world, but that doesn’t mean everyone should pay top dollar for their travel insurance.
“Once you find policies that provide the right coverage, travelers shouldn’t shy away from the least expensive option,” Moncrief said. “The premium is based on trip factors such as trip length, number of travelers and their age; it’s not an indicator of the provider’s reputation or how easily the claims process is handled.”
“Generally, if a traveler is looking to protect the cost of their trip with a cancellation policy, they should expect to pay between 4-10% of that cost,” he continued. “Most travel insurance policies are comprehensive and include several benefits in addition to trip cancellation coverage. Travelers who don’t have non-refundable expenses, or who aren’t concerned about insuring their costs, may find a much more affordable plan with useful benefits such as medical emergencies and evacuation, delays and baggage.”
Make sure you understand what you can and cannot claim on your travel insurance policy before purchasing your plan. (Photo: 10’000 Hours via Getty Images)
Misunderstanding of the claims process
“The most common mistake we’re seeing today has less to do with purchasing a plan, but rather how it is used, specifically in the claims process,” Moncrief said. “Travel insurance is designed to compensate the traveler for unplanned expenses they incur while traveling.”
For example, travelers who experience problems or inconveniences during a trip may be offered vouchers or credits from suppliers, such as the airline, but this can complicate matters.
“To be eligible for financial reimbursement from their policy, (the traveler) must not have received any refunds, credits or vouchers from their travel provider,” Moncrief said, emphasizing the importance of understanding one’s coverage and what will be needed in the claims process.
“Most travel insurance policies include a ‘money back guarantee’ period, where the traveler can cancel their policy for a refund if they review its terms and are not happy with their plan,” she said. “All policies also include 24-hour emergency assistance while traveling. In case they need to use their policy, we recommend contacting this assistance department immediately, as they can explain the benefits they are eligible for and can often avoid the claims process.”
Forgetting about health coverage
“Many international travelers are unaware that their primary health insurance does not offer coverage abroad,” Moncrief said.
For this reason, it’s helpful to consider a comprehensive plan that includes travel medical insurance, as well as coverage for things like lost luggage and trip cancellation or interruption.
“Most Americans, when they think about travel insurance, think and worry about protecting their trip, when in reality the biggest financial risk they may face is an unexpected injury, illness or medical evacuation while on their trip,” said Omar Kaywan, co-founder and chief growth officer of Goose Insurance. “The biggest mistake consumers make is not purchasing travel medical insurance or purchasing one that doesn’t fit their needs.”
He noted that most policies limit pre-existing medical conditions and may have specific exclusions. So, if you have a pre-existing medical condition, be sure to double-check the policy wording before making a purchase. The same applies if you plan to participate in certain sports or activities.
“Some policies exclude participation in sports such as scuba diving, caving, bungee jumping or any type of team sport, so consumers who plan to participate in sports activities should review the terms of the policy before purchasing,” Kaywan said. “We have seen too many mistakes when purchasing a policy for a ski vacation for which there is no coverage.”
Please pay attention to exclusions for specific destinations and the rules in effect there.
“If you are traveling abroad, check the requirements of the country you are visiting to make sure your travel medical policy is sufficient,” Kaywan said. “As COVID is still with us, many countries are requiring coverage for medical care and/or quarantine expenses.”
Do not call customer service
“When you buy travel insurance from a company, you work with licensed insurance agents who can answer all your questions and help you choose the best coverage for you,” Borden said.
Good insurance providers should also be able to help you after you have purchased a policy and in case you need to file a claim. Look for companies with good customer service that allows communication with humans, not just robots.
“Avoid mistakes by calling your desired travel insurance provider before your trip and asking for more information regarding your inquiry,” Rolander said. “If you can’t get through to them or don’t get clear answers to your questions, that’s a red flag that you should look into other providers to cover your trip.”
She noted that calling will help you learn about inconvenient travel scenarios that may qualify for a refund, such as accidental damage to a vacation rental (broken lamp, wine stain on the carpet, stove fire), tickets for activities you can no longer attend, flight delays and cancellations (and related expenses like food or hotels), or even delayed luggage.
This article originally appeared on HuffPost and has been updated.
