Understanding Travel Insurance - 03 Special Interest Topics

International Travel

When planning a trip abroad it is best to find out from your insurance agent or primary health care administrator (i.e., individual or group private medical insurance, HMO, PPO, ministry of health, etc.) whether you are covered for medical expenses incurred while traveling abroad. Many people are surprised to discover that their health care provider offers little or no protection or reimbursement for the costs of any type of medical treatment received in a foreign country. Where this is the case, purchasing adequate international travel insurance is a prudent option.

Student Travel

Students studying or traveling abroad should make sure they are aware of what insurance coverage their school or study abroad program provides, if any. Usually travel insurance is not included in a program's fees and is entirely the student's responsibility. When offered insurance always contact a few additional travel insurance providers on the Internet to compare rates and benefits, and call if you have questions. Students with health insurance coverage during the academic year are often not covered during the summer. Moreover, domestic health insurance designed for students will very rarely cover travel abroad.

Students 26 years old and younger can often find low-cost travel insurance because they are less prone to illness than older travelers, so students should ask about student rates, especially when traveling in a group of five or more when discounts can be substantial. International student ID cards often feature travel assistance services but be aware that this is not insurance and will not reimburse you for medical expenses or extra travel expenses due to delays, lost luggage, etc.

Group Travel Insurance

Group travel insurance may be available when at least 5 travelers (usually 10 or more) on the same itinerary apply for travel insurance coverage on one application. To ease the administration most group travel insurance plans are not age-rated which means the plans are the same price for all ages, and dates of birth are not required on the application. Purchasing group travel insurance can result in substantial savings in many cases, particularly for large groups (20 or more travelers), and especially for students and seniors.

Travel Supplier Bankruptcy/Default

Many trip protection plans cover lost travel expenses due to travel supplier bankruptcy and default (cessation) of services but there are substantial differences among plans. Some plans provide a list of travel suppliers that can be covered and exclude all others. Some plans require that you purchase the insurance within 7-14 days of paying the initial deposit for your trip. Many plans exclude coverage if the travel supplier that goes bankrupt or defaults is the same travel supplier that provided you with the travel protection plan. Customized "wholesale" plans provided by cruise lines and tour operators directly to travelers never cover bankruptcy or default of the cruise line or tour operator offering the plan.

Terrorism and War

After the tragedies of September 11th, 2001 many travel protection plans modified their wordings regarding terrorism. Many plans will cover trip costs in the event of trip cancellation due to terrorism, but wordings differ in important ways so read the clauses carefully and email or call and ask questions if you are confused. Some plans cover terrorism in the US some do not. Some plans cover terrorism near your home city some do not. Generally, if a plan covers trip cancellation due to terrorism you may be eligible for trip cancellation benefits if a terrorist attack occurs in the your destination country or city or a city or country on your itinerary so long as the attack occurred after you purchased the policy and within a specified number of days of your scheduled arrival (often 30 days). Be aware that how terrorism is defined in the policy is important and varies from policy to policy. Pay close attention to the words "City" and "Country" in terrorism clauses.

Coverage for acts of war as well as nuclear, chemical, and biological attacks is generally excluded from travel insurance plans, but individually underwritten high limit coverage is available (at a high cost) from specialty high-risk insurance underwriters such as Lloyd's of London, to cover medical expenses as well as accidental death & dismemberment, but not trip cancellation.