This was originally published on Monday, September 10, 2018, in the Pacific Daily News. Click here to subscribe to the PDN.
When planning a trip, we think of all the fun we intend on having. But we sometimes don’t plan on those things that worry us most. We don’t plan on food poisoning, a car accident, losing our passports or our possessions being stolen.
Travel insurance works primarily as a reimbursement. It’s there as a financial safeguard when your travel is interrupted. There are several different types of insurance. Before you purchase travel insurance, decide what type of policy you need.
Trip cancellation insurance. This insurance is exactly what implies — it covers you in the event you, or those you are traveling with, need to cancel or interrupt your trip. Most trip cancellation insurances will cover weather-related issues, illness or injury, delay in getting visas or passports and sometimes a change of plans or change of mind. Some cover kidnapping, an act of terrorism, or issues with the vendor, such as it going out of business.
The insurance company will refund you the difference of what you originally paid for the trip and how much it costs to cancel the trip. It’s best to purchase this insurance from a third party and not from the vendor with which you are traveling.
Travel medical and major medical insurance. Both provide medical protection if you or those on the policy become ill or injured while traveling. The travel medical insurance is short-term, usually a few days to a few months. The major medical insurance covers travel on longer trips of six months or more.
Not only will the insurance help you cover medical expenses, it can help you locate health care facilities or providers in the area that you are visiting. Some will even help you with foreign language translations related to your healthcare emergency.
It’s strongly recommended you consult your primary medical insurance prior to traveling to determine what or if you are covered, especially if traveling abroad. Use caution and read the fine print and know exactly what medical procedures your travel insurance covers and doesn’t cover.
Travel accident insurance. This covers you in case of accidental death or dismemberment for you and those traveling with you. This will cover sudden losses that can occur because of travel or flight accidents. Usually the insurance company will pay the traveler’s surviving beneficiaries, just like a life insurance will.
Medical evacuation insurance. If you need transportation to a medical facility while on your trip, this will help cover the cost. This is helpful if you plan on vacationing a remote rural area. In a large city, it may be easy to get an ambulance, but if you are far from civilization it may require a helicopter, a train or other modes of transportation to get you to the care you need.
This can become extremely expensive. This insurance also may cover evacuation and repatriation in case of a political unrest or natural disaster.
Specialized or package travel insurance. Coverage is based on the different needs of the traveler, such as the business traveler or those partaking in extreme activities. These policies can cover a wide range of events and are made specifically to cover you.
It can include medical, dental, trip cancellations, evacuation, passport issues, loss baggage, theft, rental car accidents, road side assistance and more.
Michael Camacho is president and chief executive officer of Personal Finance Center. He has more than 24 years of experience in retail banking and at financial institutions in Guam and Hawaii. If there is a topic you’d like Michael to cover, please email him at firstname.lastname@example.org and read past columns at the Money Matters blog at www.moneymattersguam.wordpress.com.