Is Vacation Insurance Worth it?
If you’re planning a trip, you may be considering whether to purchase vacation insurance. Trip cancellation and interruption policies are the most popular type of travel insurance, according to the U.S. Travel Insurance Association.
In fact, the organization’s 2006-2008 Travel Insurance Market Survey found that 90 percent of insurance policies were for that purpose alone. Yet there are several things to keep in mind before making the decision to buy vacation insurance.
The purpose of vacation insurance is to provide financial coverage for your trip and incidents that may occur during it. Policies typically cover the costs of nonrefundable purchases in the event that you have to cancel your vacation or end it early. These can include the costs associated with lodging and airfare.
In addition, some insurance policies provide assistance if you become stranded during your trip, according to the Oregon Department of Consumer and Business Services. They provide for food, accommodations and medical emergencies.
In addition to policies that cover trip cancellation, delay or interruption, you can purchase travel insurance that specifically provides medical coverage. This includes not only coverage of medical services but also the costs of traveling to a hospital or medical facility.
Accidental death insurance may cover any incident of accidental death during a vacation or during periods of transport. Other travel insurance options include coverage for your baggage and rental car.
If you’re going on a costly vacation planned well in advance, vacation insurance can provide peace of mind. Cruises and vacation tours typically must be booked months before the departure date. If you become ill or lose your job during the period before the trip, travel cancellation insurance can become essential.
Policies that cover medical care can also become invaluable, particularly if you’re traveling out of the country. Some medical policies may provide coverage for you to be transported to a hospital near your home as well, according to the Washington State Office of the Insurance Commissioner.
Keep in mind that vacation insurance policies have restrictions on what incidents are covered and in what context they occur in. For example, accidental death insurance may only cover death that occurs while flying. Like traditional health insurance, your vacation medical coverage may be affected by preexisting conditions.
Some policies do not cover these conditions or charge a higher rate; others do not provide any coverage for older travelers. It’s also important to take a look at your auto, health and life insurance policies because they may provide coverage during trips.
Review your credit card benefits because some offer travel coverage if you pay with the card.
Deciding whether to purchase vacation insurance ultimately comes down to your current insurance coverage, the type of trip you’re taking and your ability to absorb unexpected costs. If you’re planning an expensive vacation in a foreign country, purchasing a policy may be in your best interest.
In addition, if you’re planning a trip that includes highly physical adventures, having medical coverage is key. However, it’s probably not worth to purchase vacation insurance if you’re going on a short-term trip within the country.