The 8 Most Surprising Things Travel Insurance Covers – Forbes Advisor
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If you’ve been shopping for travel insurance, you’ve probably seen that it can cover trip delays, lost luggage and medical care. But you’ll never guess what else travel insurance covers.
Brendan Lee was surprised that travel insurance covered his incident, for example. On a visit to Africa, a police officer detained him and demanded a bribe. Eventually, he had to pay $600 in fees to “extend” his visa and assumed he’d have to pay the entire amount out of pocket.
“I relayed this entire story to my travel insurance company and filed a claim,” recalls Lee, who writes a travel blog called Bren on the Road. “They paid it in full! The bribe and the lawyer’s fees. It was covered under a special section in my policy called ‘hijack and detention.’”
Most travelers don’t bother to read their travel insurance policies. To prove the point, the travel insurance site Squaremouth surreptitiously offered $10,000 to the first person who read their policy to the end. The company estimates that less than 1% of travelers who buy travel insurance read all of their policy information. The winner discovered the giveaway at the end of her policy less than 24 hours after the competition started. So there is hope.
“It’s always a good idea to read through your plan document to get familiar with all the great benefits available to you,” says Sherry Sutton, vice president of marketing at Travel Insured International.
Here are some of the surprising things your travel insurance may cover:
Bankruptcy of your airline, hotel or tour operator
Some travel insurance policies will cover you if your cruise line goes under before you can set sail. That’s a real possibility in a post-COVID travel industry. But, says Rachel Coen, a spokesperson for G1G Travel, not all travel insurance policies cover bankruptcies equally.
“Look for a travel insurance plan that does not exclude bankruptcy and financial insolvency,” she says. “And make sure there are no white or blacklists—which essentially tell you which companies will and won’t be covered for bankruptcy.”
Note that if you’re getting trip “protection” directly through a company or tour operator, you won’t be covered during a bankruptcy.
When Michael Rozenblit rented a car recently, he reviewed his travel insurance policy to see if he was covered. Was he ever! His policy covered rental car deductibles up to $3,000.
“This meant that I didn’t need to take out the more expensive insurance options from the car rental company,” says Rozenblit, a frequent traveler who writes a blog about travel to Europe called The World Was Here First. That effectively reduced his deductible to zero and saved him a lot of money.
His policy also covered him for returning his vehicle early to the car rental company if he became medically unfit to drive. “It’s worth reading your travel insurance policy in detail before paying for any additional insurance from your car rental company, as you might be able to avoid extra charges,” he adds.
Travel insurance can cover death—yours or a death in the family.
“For instance, if you or a family member were to pass days before your trip and you no longer wanted to go on the vacation, your insurance policy would cover the costs,” says Simon Huften, president of LifeInsuranceCanada.com. Travel insurance can also cover something called repatriation of remains, which is a sophisticated way of saying it will cover the expense of flying your body home.
For more robust coverage, Huften says you might want to consider a term life insurance policy. “Particularly if you’re planning on multiple month-long trips over the next decade,” he says. “That will ensure you’re covered for all possible incidents.” Plus, a term life policy will cover you for causes of death that have nothing to do with your travel.
This coverage can be particularly useful now, at a time of almost record unemployment.
“If you lose your job after paying for your vacation, or your boss requires you to work, or perhaps there’s an acquisition or merger that prevents you from going on vacation, travel insurance can cover you,” says Brandon Foster, a travel advisor with Magic Lamp Vacations, which specializes in theme park vacations. Travel insurance will cover 100% of the canceled trip cost after a job loss, up to a certain amount, according to Foster.
Some travel insurance policies cover kids without the need for another policy. For example, Allianz Travel’s OneTrip Prime Plan and the OneTrip Premier Plan cover children age 17 and under at no additional charge as long as they’re traveling with a parent or grandparent. If you buy an annual policy, you can insure the entire family without having to buy an additional policy.
Surprisingly, travel insurance can cover loss of jewelry if your bag is pilfered, according to Don Elliott, director of claims at Jewelers Mutual, an insurer.
“For example, baggage insurance typically has a per-item limit and specific item limit, which means you won’t likely get fully reimbursed for your jewelry,” he says. Some insurance plans provide only minimal jewelry coverage.
Jewelry loss while traveling happens more often than you’d think. In a survey by Jewelers Mutual, 20% of those surveyed experienced loss or theft of fine jewelry while traveling, up from 10% in 2015.
“Certain travel insurance companies have started to cover your pets,” says Candy Godoy, a pet travel blogger at Boogie the Pug. “It’s great and much appreciated!”
For example, Travelex Insurance’s Travel America plan offers coverage for pet medical expenses and pet return if a traveler’s cat or dog needs medical assistance while traveling. The pet medical expense coverage can also provide reimbursement for an emergency trip to the vet. The pet return coverage will pay for transportation for your pet if you were to become sick or injured on your trip and you were unable to travel.
“This is another way travel insurance can help keep you and your pets stay safe while traveling,” says Travelex spokesperson Brad Streff.
Redeposit Fees for Loyalty Points
Alison Watta discovered that her policy through Travel Insured covered her when she had to cancel a flight booked with frequent flier miles. It turns out several travel insurance policies do that.
“Some travel insurance companies will reimburse you, usually around $250, for airline tickets purchased with rewards points if you need to cancel your trip,” says Watta, who edits the site ExplorationSolo.com. However, travel insurance won’t cover any miles or points you lose as a result of a cancellation. If you don’t redeposit the awards, you’ll lose them.
Travel insurance can cover some major but often obscure problems you encounter while traveling. But sometimes it also takes care of the little things. Consider what happened to Shawn Crowley, a college recruiter based in Washington, D.C. On his way from Dallas to Honolulu, he missed a flight connection in Seattle, forcing him to spend the night there. It was the middle of February.
“I was grossly unprepared for the cold weather,” he says. “I went to Walmart to pick up a hat, gloves and a cheap jacket.”
AIG quickly reimbursed him for the clothes.
You never know what your travel insurance policy might cover until you read it. And there’s a reason for all the bells and whistles, besides the obvious—there’s a demand for them. Insurance underwriters can afford to provide these special coverage perks because the number of claims is low—perhaps because travelers may not be aware of these coverages or simply don’t bother to make the claims. Either way, they can offer coverage without increasing their claims payments in a meaningful way.
So read your policy details carefully, because the more you know, the more you can enjoy your trip.