Travel Talk: Know your insurance policies before you take off
To me, insurance is a confounding subject – full of exclusionary fine print and backed somehow by actuarial numbers seemingly designed to make sure the company rarely (if ever) has to pay if something goes wrong for the insured. Now apply the concept of insurance to the world of travel, where the opportunity for mishaps seems unlimited. Take, for example, the recent case of the nearly imploded Pembroke Academy trip to Spain. The tour organizer defaulted mere days before departure. An angel (in the form of the New Hampshire Charitable Foundation) saved the day for the students – but suppose that had been your trip. Angels aside, can you protect yourself?
Maybe: Forgetting for a moment the disappointment in having a long-awaited trip vanish, a key for most of us is making sure that we don’t lose the investment along with the experience. Using a bit of caution and common sense from the get-go can be a help. If you are booking through a tour company or a travel agent, go with the “big guys” or companies that have a long-standing local presence and solid reputation. Two that come to mind are our own branch of AAA (aaa.com, 48 Fort Eddy Road, 228-0301) and Penny Pitou Travel (pennypitoutravel.com, 55 Canal St., Laconia, 524-2500).
Paying with a major credit card whenever possible can provide another layer of protection. In August of 2001, Bud and I booked a cruise tour with a company that went into bankruptcy within days of 9/11. Thanks to our Visa, we didn’t lose a dime. Those who paid with bank drafts and checks weren’t so lucky. Terms vary, of course, among cards – so be sure you know what yours covers. Lastly, there’s the travel insurance that many now think of as the ultimate protection.
Maybe not: The most important thing to understand about travel insurance is that it is normally designed to cover a very narrow set of circumstances – the death or critical illness of an immediate family member, a catastrophic fire at your home a few days before departure . . . things like that. The “default” of the various companies responsible for the components of your trip is often limited to the “complete suspension” of that company’s operations – and applies solely to companies that actually supply services (airlines, hotels, cruise companies), not travel agents, tour companies or websites like Expedia that sell the trip to you. In addition, the travel insurance companies themselves have lists of travel suppliers that are specifically excluded from coverage because of previous bankruptcy or weak financial status.
Your best shot at not getting a nasty surprise is to take the time to research any policy and understand not just the fine print (especially the exclusions), but also all definitions. Two sources that can help with this are totaltraveinsurance.com/banckruptcy-insurance.asp and insuremytrip.com, where I’ve found the agents at the phone banks (800-487-4722) are especially helpful. But don’t forget your local trusted and experienced travel agent – they’ve likely seen it all and can help advise you.
Fees and timing: A critical part of insuring your trip is when you buy the policy. Some policies must be bought within a certain number of days (often 7-15) of paying the initial deposit on your trip.
Other policies only apply if a certain amount of time has passed between the policy’s purchase and the event that triggers the claim. Most policies only cover the nonrefundable portions of your trip, and most policies are priced as a percentage of the total insured portions of the trip. Sound complicated? For sure! Protect yourself by doing your homework.