A solid travel insurance plan is a smart way to protect your travel investment in case the unexpected happens. And as anyone who has ever traveled knows, the unexpected is always possible.
If a great holiday is one of your goals this year, here are some top tips for finding the best travel insurance and getting the most out of your cover.
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1.) Tailor Your Coverage to Your Itinerary
Your vacation itinerary plays a significant role in determining how much coverage you will need. Let’s say you book an overseas excursion with connecting flights that includes multiple sightseeing tours, entertainment at various locations, and some exploration and sports activities.
For such a trip, consider comprehensive travel insurance that includes:
Trip Cancellation and Trip Interruption Cover, which can reimburse you for pre-paid non-refundable expenses if you have to cancel or cut short your trip for reasons specified in the policy.
Trip delay insurance that compensates you for expenses incurred during layovers and missed activities that you have paid for in advance and that are non-refundable.
Covering medical expenses for medical treatment, drugs, x-rays and more due to a medical emergency.
Medical evacuation cover in case you need to move to a better medical facility. (This may be included in your medical coverage.)
Baggage loss insurance, which can provide compensation if your luggage is lost, stolen or damaged.
2.) Get the right coverage for your destination
If you’re only traveling within Canada, your provincial health plan probably covers the cost of your health care. (However, there are exceptions, which is why many travel insurance companies offer packages for travel within Canada.) However, you may have very limited, if any, coverage overseas.
Therefore, it is often crucial to have travel health insurance for trips abroad. This type of coverage pays “reasonable and customary charges” for costs such as:
- Medical bills.
- Ambulance.
- Hospital room charges.
- Operating room fees.
- Examinations, X-rays and laboratory tests.
- Medicines and prescriptions.
3.) Buy Travel Insurance Soon after You Book Your Trip
Travel insurance starts working the moment you buy the policy. Trip cancellation and interruption insurance will reimburse you for any non-refundable purchases you make (such as a flight or hotel) if you need to cancel your trip for a covered reason, such as illness. If you buy tickets, get sick and then buy travel insurance, you won’t get any compensation.
In addition, some types of coverage are only available for a certain time frame after the first deposit is made for the trip. For example, if you choose the ‘Cancel for any reason’ upgrade, which allows you to cancel for a wider range of reasons than a standard policy, you usually have to add it within two to three weeks of making the initial deposit for the trip.
4.) Consider the Pros and Cons of “Cancel for Any Reason” Coverage.
Standard trip cancellation benefits only apply to cancellations for the reason stated in your policy. However, if you want maximum flexibility, consider canceling for any reason (CFAR) travel insurance. Although more expensive than standard cover, it will cover a portion of the non-refundable, pre-paid expenses of your trip if you want to cancel it for reasons not listed in the basic policy. You can make a CFAR claim, for example, if it rains at your beach resort. However, not all CFAR policies are created equal, so make sure you know the rules. For example:
You cannot cancel at the last minute and each insurer has its own deadline by which you must cancel. For example, TuGo requires cancellation five or more days before departure, while AMA travel insurance allows cancellation up to three hours before departure.
You generally won’t get 100% compensation – you’ll get 50% or 75%, depending on the plan.
You must add the insurance within two or three weeks of making the first payment for the trip. The purchase date varies by company, but don’t delay if you think you want CFAR coverage.
5.) Consider the Pros and Cons of “Cancel for Any Reason” Coverage.
Standard trip cancellation benefits only apply to cancellations for the reason stated in your policy. However, if you want maximum flexibility, consider canceling for any reason (CFAR) travel insurance. Although it is more expensive than standard cover, it reimburses a portion of the non-refundable, pre-paid expenses of your trip if you want to cancel it for reasons not mentioned in the basic policy. You can make a CFAR claim, for example, if it rains at your beach resort. However, not all CFAR policies are created equal, so make sure you know the rules. For example:
You cannot cancel at the last minute and each insurer has its own deadline by which you must cancel. For example, TuGo requires cancellation five or more days before departure, while AMA travel insurance allows cancellation up to three hours before departure.
You generally won’t get 100% compensation – you’ll get 50% or 75%, depending on the plan.
You must add the insurance within two or three weeks of making the first payment for the trip. The purchase date varies by company, but don’t delay if you think you want CFAR coverage.
6.) If You Are Planning Riskier Activities, Look into Adventure Travel Insurance
Travel insurance usually has exclusions for high-risk activities. For example, if you go skydiving or parasailing during your trip, your travel health insurance may not cover you if you get injured.
If your trip includes activities outside of traditional sightseeing or museum tours, make sure you get a policy that will cover your specific higher-risk activities. For example, the World Nomads policy is aimed at more adventurous travelers with 250 activities included, while CAA travel insurance offers additional cover with an Adventurous Air Activities rider. A travel insurance agent can help you find the right options based on your itinerary.
7.) Confirm Your Covid Coverage
While there are fewer travel restrictions related to the COVID-19 pandemic, it is still a consideration for many travelers. If you’re concerned about COVID-related issues, make sure the plans you’re considering cover COVID-related cancellations and/or medical expenses.
Keep in mind that coverage may depend on your vaccination status. For example, BCAA travel emergency health insurance provides coverage of up to $1 million for partially vaccinated travelers (one dose) and $10 million for fully vaccinated travelers (two or more doses). Since COVID is considered a “known” global event, it is no longer covered by the plan’s trip cancellation coverage
8.) Find out If Your Travel Insurance Company Has a Mobile App
Some travel insurance companies have mobile apps that make it easier to manage travel plans (and issues) while on the road. For example, the Allianz TripWise app provides live updates on flights, hospitals
9.) Don’t Assume Travel Insurance Is Unaffordable
You might think travel insurance is expensive, but it can be relatively affordable. If you’ve paid thousands of dollars in deposits for your vacation, travel insurance can be a wise way to protect your investment. It can be easy to get quotes online and find a plan that fits your needs. You can also customize your coverage to fit your budget. For example, some insurance companies, such as CAA Travel Insurance, allow you to add a medical deductible to reduce your premium. If you needed to make a claim, you would pay the deductible first out of pocket and then your coverage would kick in.
10.) Save Your Receipts Before You Leave for Your Trip
People buy insurance of all kinds in the hope that they will never need to use it. However, if you need to make a claim, you want to make sure you have all the supporting documentation needed for faster processing.
If there is a delay in processing a claim, the most common reason is that the policyholder has not submitted sufficient evidence or documentation to demonstrate actual financial loss.
For example, if you’re making a baggage claim, make sure you have copies of documents for all items you’ll be claiming compensation for in the event your baggage is stolen or lost.
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Michelle is an insurance analyst at Forbes Advisor. She has been a journalist for more than 30 years and has been writing about consumer insurance for the past decade. Before insurance, Michelle was a lifestyle reporter for the New York Daily News, a magazine editor covering consumer technology, a foreign correspondent for Time and various newswires, and a local newspaper reporter.
