To insure, or not to insure — for many travelers that is the question.
Once that decision is made, what kind of insurance should travelers buy? While some tour operators and insurance companies offer cancel-for-any-reason insurance, the normal travel insurance policies are considerably more restrictive.
And sometimes even cautious travelers get caught without insurance, even when they thought all bases were covered. The situation with Eqypt is a good example.
One of my clients had independently booked a tour in Egypt for March 2011. The travel company canceled the tour this month and refunded everyone’s money (a generous and not universal reaction).
But the traveler purchased his airline ticket through me, using the cheapest available fare on American and British Airways. The ticket is nonrefundable except in cases of death.
While American has issued waivers for refunds to travelers ticketed to Egypt, that waiver period, at least for now, ends in late February. So my client is out of luck right now.
It could be worse. The airline will allow him at least to reuse the ticket for a $250 penalty within a year, but that won’t put money back in his pocket. Plus, if the unrest in Egypt affects travel there through March, perhaps he can rebook with no penalty, but he probably won’t get his money back.
This traveler was insurance-savvy. He purchased many forms of travel insurance to cover medical reasons, but that won’t help either.
For an example: Travelex, one of the nation’s largest travel insurers, has several policy levels. The lowest — Basic — covers a multitude of reasons, including weather, sickness, strikes and jury duty, but not demonstrations. And while some of the higher levels cover “terrorist incidents,” Egypt, even with its beatings, wouldn’t have qualified under that condition either.
In fact, political demonstrations, and even riots, are seldom covered under most general policies, unless they result in flight cancellations and disruptions last for some days beyond that.
With Travelex and other insurances there are the options to cover “cancellation for any reason,” for an additional cost, however, even then travelers may not get 100 percent of their money back.
There is no one perfect insurance choice. For many travelers, covering sickness is sufficient. Others want to make sure that the need to cancel a vacation because of issues with their families or jobs are covered. Still others choose to self-insure.
One of my wealthiest clients takes very expensive trips every year, and never takes insurance. He figures that insurance is five-ten percent of the trip cost, and if he cancels one trip every 20 years or so he will still come out ahead. (So far, he has been lucky.)
This post is not intended to be insurance advice. In fact, part of the problem, besides the fact that insurance policies seem to be deliberately difficult to understand, is that it’s very difficult to predict just exactly what could affect a trip.
On the other hand, when putting down money that you really can’t afford to lose, it’s a good idea to at least consider insurance carefully, and read the fine print.
Unfortunately, one thing in the insurance claim world is almost guaranteed — While most major insurance companies will pay out for a clear cut claim, if there’s an incident, personal or political, that results in travel penalties, and it’s in a gray area of a policy, the odds aren’t in the traveler’s favor.
Janice Hough is a California-based travel agent a travel blogger and a part-time comedy writer. A frequent flier herself, she’s been doing battle with airlines, hotels, and other travel companies for over three decades. Besides writing for Travelers United, Janice has a humor blog at Leftcoastsportsbabe.com (Warning, the political and sports humor therein does not represent the views of anyone but herself.)
