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With the winter season upon us, many consumers are planning trips to visit loved ones for the holidays or to spend a week or so in a warmer climate. Many consumers consider travel insurance to protect them and their finances should something go wrong. Before you put money on travel protection, you should review the following tips based on information from the National Association of Insurance Commissioners (NAIC).

Travel insurance may not be necessary for all trips and consumers may have coverage from an existing policy such as their health, life, or homeowner/renter. Review your policy or speak with an insurance agent to find out more about your coverage that may already provide some protection for travel. Credit card companies may also offer travel insurance if you pay with your card.

Ask yourself:

  • What could go awry before or during the trip, and can I cover these costs without insurance?
  • Will coverage apply to only personal emergencies or does it apply to family emergencies as well?
  • What is the refund policy on prepaid expenses? How long in advance do I have to cancel to get a refund?
  • What benefits will the insurance company offer? Will they rebook a flight or help me find a new hotel room?

Types of Travel Insurance:

There are two main types of travel insurance.  The first protects against the loss of non-refundable travel costs – such as airfare, hotel or tour expenses. The other type of travel insurance offers protection against loss due to medical emergencies, damage to personal property or death that occurs while you are traveling.

Trip Cancellation/Delay/Interruption Insurance:

If you are making a deposit on a cruise or have airline tickets, consider this type.

  • Trip Cancellation – Reimburses pre-paid travel expenses if you aren’t able to take your trip because you become ill or die.
  • Travel Delay – Reimburses pre-paid expenses if you aren’t able to take your trip because of a travel delay, such as a flight delay or cancellation.
  • Trip Interruption – Reimburses pre-paid expenses if your trip is cut short because you become ill or die, or because of any other misfortune listed in the policy. Covered reasons might include bad weather, airline strikes, terrorism, bankruptcy, jury duty, or fire or flood damage to your home.

Medical/Accidental Death Insurance:

If you consider this policy, ask about pre-existing conditions and age limits, as companies deal with these issues differently. Some insurers ask you to pay a higher premium to cover pre-existing conditions and may charge more for elderly travelers.

  • Medical/Health – Reimburses medical and emergency dental expenses that you receive dueto an illness or injury while you’re traveling.
  • Medical Evacuation – Provides emergency transportation to either a hospital in the geographic region where you are and/or transportation back to a hospital near your home.
  • Accidental Death – This coverage is split into three parts:
    • Air Flight Accident – Covers death or dismemberment during flight only.
    • Common Carrier – Covers death or dismemberment while traveling on public transportation such as a plane, ferry, train, bus or taxi.
    • Accidental Death – Covers death or dismemberment at any time during a trip.

Protect yourself by distinguishing from real and fake insurance coverage. Before you write a check for the premium or sign the application, call your state insurance department to confirm the agent and company are licensed in your state. In Massachusetts, contact the Division of Insurance.

Travel insurance typically costs between 4 and 8 percent of your trip’s prepaid, nonrefundable cost. If the policy is less than 4 percent of the cost of your vacation, that’s a red flag. At the same time, policies that cost significantly more than 10 percent may be a cause for concern.

Possible signs of fraud include:

  • If the insurance is advertised through spam emails, Internet pop-ups or sign posts.
  • If the company claims you can save an extensive amount on travel insurance.
  • If the company markets their insurance with a high-pressured, extreme urgency and tells you that you “must act now” or that “this is a one-time offer.”

For more information on travel insurance, visit the NAIC’s website.

If you have additional questions, contact the Office of Consumer Affairs and Business Regulation by calling our Consumer Hotline at (617) 973-8787, or toll-free in MA at (888) 283-3757, Monday through Friday, from 9 am-4:30 pm. Follow the Office on Facebook and Twitter, @Mass_Consumer. The Baker-Polito Administration’s Office of Consumer Affairs and Business Regulation along with its five agencies work together to achieve two goals: to protect and empower consumers through advocacy and education, and to ensure a fair playing field for Massachusetts businesses. The Office also oversees the state’s Lemon Laws and Arbitration Program, Data Breach reporting, Home Improvement Contractor Programs and the MA Do Not Call Registry.

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