What Type Of Travel Insurance Should I Consider Purchasing?

Life can be full of unexpected complications which at any moment can derail travel plans. As with most situations it depends on your travel history and the level of risk you're willing to assume should you opt out of travel insurance. Are you traveling to the Caribbean during hurricane season? Do you have a loved one which may be in failing health and require you to cancel your travel plans? Are you the CEO of a major company trying to squeeze in some quality time with the family? If you are taking an expensive trip and you can't guarantee you'll make it, travel insurance might be right for you.

Like any other insurance policy, travel insurance from different companies will cover different circumstances which can determine the price of the policy purchased. The two most common types of travel insurance are provided by cruise lines sold directly from the cruise line company to trip cancellation policies provided by travel agencies and other independent insurance providers.

If you are going on a cruise it is important to read all the documentation as it pertains to cancellations and refunds. Many cruise lines have a penalty period and once final payment is made and it may not be possible to receive a full refund from the cruise line provider. A cruise line provided insurance policy will normally reimburse the traveler for the cost of the fare as long as the reason for the cancellation is listed in the policy coverage.

Most travel insurance in general will cover situations such as illness, jury duty, death of an immediate family member in other situations as outlined in the policy. However, most travel insurance policies will not cover business emergencies or acts of terrorism as those may be unforeseen and outside of most policies act of god stipulations such as natural disasters.

It is important to remember not all travel insurance policies will provide the same coverage. Some policies will refund the full amount for the cost of the trip, other policies will only refund part of the cost such as 80% of the expense, while some policies or cruise lines will only provide a full or partial credit to be applied to a cruise from the same company at some future date. As always, it is important to fully read and understand the documentation to know which situations are covered should you need to cancel your trip.

While not travel insurance specifically, you may want to consider purchasing additional health insurance coverage while traveling to protect against illness in middle of your vacation. Most domestic health insurance policies did not provide medical coverage once traveling out of country. As a result you may want to add a travel health insurance rider to your existing policy or purchase a separate short-term policy for the duration of the trip.

At the end of the day it depends on how comfortable you are with where you're going, how you're getting there and how expensive the trip is going to be for you and your family. Traveling to a foreign country or a two week cruise has substantially more risk of cancellation or illness than traveling to a family reunion in another state.