Travel Insurance:
To Buy or not to Buy?

This discussion focuses on classical travel insurance, not the far more
limited dive accident insurance policies.

While all of the better dive accident insurance plans do include trip cancellation & interruption benefits, these are essentially limited to cancellations/interruptions based on your sustaining a medical condition that precludes safe diving. Unlike many general travel insurance policies, they do not cover cancellations/interruptions for death or illness of a close family member, strikes/collapses/bankruptcies of common carriers & travel agencies, civil unrest at a destination, hurricanes & other natural disasters, and the like.

Because of such factors as sustained terrorism fears post 911, new airline rules severely limiting changes made to non-refundable tickets and movement of individuals from traditional third party payer medical insurance plans to HMOs, divers are left feeling as if their scuba vacations are more at risk than ever.

Not surprisingly, the number of people purchasing general travel insurance has increased by about 20% post-911.

Is it for you?

I personally have never purchased it, nor yet needed it. I agree with
"Consumer Reports" that it probably is the most over-priced, and confusing, of all travel services.

Based on the policy costs of 4 1/2 % to 7% of the price of the vacation, I'd estimate that had I secured good quality general travel insurance for every dive trip I've taken to date it would come to about $15,000. Even in the event that my normal credit card protections, top of the line DAN dive insurance policy, homeowner's policy or some other existing coverage didn't address my particular trip cancellation/interruption issues, this savings to date could absorb a couple of big hits.

Now, this isn't to say that I'd never, under any circumstances, buy it. If I had a terminally ill parent and very big dollar trip set up to an exotic destination during typhoon season that was currently experiencing civil unrest, I very likely would. But, barring unusual circumstances I simply do not think it's a good value for the otherwise properly insured diver.

However, I understand that the personal circumstances & levels of comfort for risk are highly idiosyncratic, and I appreciate that others may want to seriously explore such policies.

In doing this, one should first determine exactly what coverage they feel they need based on their present circumstances & already existing coverage.

Next, go the websites of the major players (*many listed below) to see what they offer and how much it costs. When you do this, please be very careful about the fine print. For example, some plans cover you only if a travel company/airline formally files for bankruptcy protection (and not every policy covers every bankruptcy). Other policies leave it up to the US State Department, law enforcement agencies or news media outlets, not you, to define what constitutes a terrorist attack, foreign or domestic. They may set limits on how close the attack has to be to your destination before it goes into effect--this may or may not fit your personal comfort zone. And, you generally must buy the policy before violence erupts to be covered.

Here are some more things to think about:

1. Probably not a good idea to buy a policy from an insurer who also happens to be the travel provider, e.g., some cruise ship lines. The wisdom of this should be obvious.

2. Consider buying primary rather than secondary coverage. It'll be a whole lot simpler in the long run. Don't have to worry about collecting from all other sources, e.g., home owner's, and documenting everything ad nauseum.

Related to this, have a grasp of what your car, home, medical, etc., insurance already cover. For exmple, do they remain in effect when you're in a foreign country?

3. Be sure to read the fine print regarding events under your own control. This covers distinctions between situations as missing a flight due to oversleeping v being stuck in an accident, or being unable to go due to a medical illness v boss saying an unexpected project is more important than scuba.

4. What with terrorism & the threat of war, be sure you understand what a policy covers. For example, many policies require a State Department warning of some sort.

5. Plan for the worst. It's the initial policy amount that costs the most. Adding extra amounts of coverage is often a bargain. Don't get silly about it, but buy enough to cover the worst case scenario.

6. A pet peeve of mine. Know what a policy excludes in terms of "pre-existing medical conditions." If an old injury/illness interrupts a dive trip, you could be out of luck.

7. Know what the policy says about your obligations to notify the insurer & substantiate your claims. Insurers will cut their losses at your expense if you don't follow the rules.

Here is a Travel Insurance Comparison Site that purports to list insurance plans and to allow for comparisons based on coverage & cost.

Travel Guard International

Travelex Insurance Services

Travel Insured International

HTH Worldwide

Access America

CSA Plan

Maduro Dive Fantasies (go to menu selection for Travel Insurance & download policy)

© Doc Vikingo 2005

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