This was originally published on Monday, September 17, 2018, in the Pacific Daily News. Click here to subscribe to the PDN.
A well-planned trip will almost always bring about happy memories. You can learn about new cultures, see new places and meet new people.
What happens if something goes terribly wrong and you are miles from home, in a foreign country where you may not speak the native language, or you are far away from the next point of civilization? A misplaced passport, flight delays or cancellation, lost luggage, sudden illness or injury can certainly turn a planned trip into an expensive, chaotic and stressful journey.
Travel insurance is designed to help ease the stress and finances of those unplanned events. There are four ways you can purchase travel insurance:
- Single-trip travel insurance. Most travelers purchase this policy. It’s purchased before you leave home and expires when you return. Most single-trip policies can cover up to 10 travelers and used domestically or internationally. This policy is for travelers who don’t travel often and provides protection for a single trip.
- Multi-coverage travel insurance. This insurance will cover multiple trips within a year. It can cover more than one person. Most of the time, the trips aren’t very long and usually don’t exceed 30 days.
- Annual travel insurance. This policy covers frequent travelers who take trips that usually last 30 to 365 days. The policy usually starts the day of the first departure date and expires a calendar year from that date.
- Group travel insurance. If you have a large family or plan on traveling with extended relatives or friends, then this policy may fit your needs. It usually covers up to 10 or more travelers. Just like the single-trip insurance, this policy typically covers lost luggage, trip cancellations, delays, and medical emergencies.
Although travel insurance is designed to reimburse you for the non-refundable expenses, it does have limitations. While needs are unique and every trip can run into different unforeseen events, there are certain reasons insurance claims can be denied.
Before you decided to purchase your travel insurance, here are a few reasons to consider:
- Pre-existing illness. Your wife suddenly came down with a bad cold or the stomach flu the day before you depart. A decision is made to stay home and reschedule or cancel your trip.
Some travel insurance policies may require a physician examine the traveler before canceling, while others may require the traveler to see a physician 72 hours after cancellation. Either way, a physician usually must write a statement stating the traveler wasn’t medically able to make the trip for the claim to be approved.
- Cancellation of trip. If you are canceling your trip because you found out that the tour company that was going to take you on a safari went out of business, you may need to provide more than just your credit card statement. You must thoroughly document all your trips cost and any refunds.
Some documents may include hotel and rental car confirmations, documents that officially explain the cause of your trip cancellation, original tickets and much more. Contact your travel insurance company as soon as possible to get the appropriate documents.
- Foreseen events. Insurance policies cover sudden and unforeseen events. If there’s a typhoon heading toward your dream vacation destination, you may not be able to purchase traveler’s insurance. If you are already there when the disaster hits, be sure to keep all your receipts and documentation, especially for extra costs due to the disaster.
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 email@example.com and read past columns at the Money Matters blog at www.moneymattersguam.wordpress.com.