Many travelers like the idea of purchasing their travel and travel protection as a single purchase with one company; however, this convenience and perceived cost savings may come at a price.
The term ‘travel insurance’ is often used loosely by travel agents and it can be confusing to travelers who want to purchase travel insurance. These plans may be referred to as ‘benefit services’, ‘waiver plans’ or ‘travel protection’, but they are not 100% travel insurance.
There are a number of reasons to be wary when offered a protection plan by your travel agent, including:
Travelers purchasing a ‘travel protection plan’ may not be aware of the differences between a travel protection or waiver plan purchased through a travel agent and a travel insurance plan purchased through a licensed travel insurance agent.
|TRAVEL INSURANCE PLANS||TRAVEL AGENT PROTECTION|
|In the event of a claim, how are you paid?||By a check in U.S. dollars.||Payment depends on the reason you have a claim – some payments may be in the form of future travel credits with expiration dates.|
|Are independent travel arrangements covered?||Yes, all non refundable pre-paid travel costs are covered, including third-party airline tickets, side trips, tours, and excursions.||No, only the arrangements made and purchased through the travel agent are covered.|
|Is bankruptcy or financial default covered?||Yes, as long as you’ve purchased a plan with that coverage and met the plan rules.||No coverage|
|Are cancellations for reasons of terrorism or political unrest covered?||Yes, depending on the plan.||May or may not be covered|
|Does it include emergency medical coverage?||Yes, depending on the plan you choose; coverage limits as high as $1,000,000 are available.||Often, but coverage limits are usually quite limited ($10,000 – $25,000).|
|Is there ‘cancel for any reason’ coverage?||Yes, depending on the plan.||No coverage|
|Is trip cancellation for schedule conflicts (jury duty, work, school year extensions) covered?||Yes, depending on the plan.||May or may not be covered|
|Does trip cancellation extend to my departure?||Yes, trip cancellations are covered until the moment you leave home.||No, cancellation coverage often ends 1-3 days prior to your scheduled departure.|
|Is there coverage for pre-existing medical conditions?||Yes, depending on the plan.||May or may not be covered|
|Is there an official body regulating the plans?||Yes, travel insurance plans are regulated by each state’s Insurance Licensing Department.||No, if you have a dispute, your only recourse is to file legal action which will likely cost additional money.|
While some travel agencies combine forces with a licensed travel insurance agent, it’s important to be sure the plan you are purchasing is what you really need. One way travel insurance supports this is by providing a free look period (usually 10-15 days), which you can use to review the policy and be sure you have the coverage you need. During this period, you can also make changes to the coverage or cancel the coverage (for a small fee).
If you decide to purchase through your travel agent, be sure to ask who you are to call while on your trip if you run into trouble. All travel insurance plans have 24/7 worldwide assistance services that can help travelers in a number of ways.
Damian Tysdal is the founder of CoverTrip, and is a licensed agent for travel insurance (MA 1883287). He believes travel insurance should be easier to understand, and started the first travel insurance blog in 2006.