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When you Should Purchase Airline Insurance

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Leisure travel is something most people spend a significant amount of time doing research and planning. With limited vacation time, everyone wants the perfect trip. Airline tickets, lodging, and rental cars aren’t cheap. In most cases, a huge portion of that money needs to be put down months before the actual vacation begins. When an emergency arises, travelers can be out of that downpayment. If the planned trip is costly, travelers should consider purchasing insurance to protect at least some of the money if the trip must be canceled or cut short due to an emergency. As with all types of insurance, you’ll need to determine the amount of coverage for your needs at a cost that you can afford. There are several options and ways to obtain protection. Here are some of the most common.

Credit Card Coverage

Most major credit cards offer some type of travel coverage if you book the travel with the card. Common offerings include lost, stolen, or damaged baggage and collision coverage for a rental vehicle. If covered by your card, this can add up to significant savings at the car rental agency. Check with your credit card provider to see what benefits they provide. If you have an auto loan through a bank or credit union, you most likely have full coverage. Check with your insurance carrier to see if they include any travel coverage and, if so, what kind.

Airline Trip Protection

This type of coverage is offered through the airlines at the time of booking. It can be relatively inexpensive. Typically trip protection covers cancellation under specific and limited circumstances. If your reason for cancellation is outside of the protection offered, the airline won't reimburse you. This coverage also provides some reimbursement for lost or stolen bags. Your ticket normally provides some automatic coverage; check with the airline. Trip protection is not insurance. If considering trip protection, read the fine print. It can be an affordable option if you are aware of the terms and restrictions.

Travel Insurance

Several insurance companies offer travel insurance. Like all insurance, travel insurance is regulated by the state governments. Do some comparison shopping and look at the benefits and costs. Cancellation coverage is popular, and generally, companies provide several options. Always read the fine print to see under what circumstances you can cancel and be reimbursed. The policies that cover cancellation for any reason will cost the most. Some policies include coverage if your trip is cut short. Find out if the policy you are considering will pay for an emergency flight for you and your family members if your trip is cut short due to an unforeseen event.

Another reason to consider travel insurance is for medical treatment. Not all United States (US) health insurance policies provide coverage in foreign countries. Those that do cover only a limited amount. If you are traveling out of the country, consider purchasing travel insurance with health insurance coverage. Medical costs in a foreign country are typically a fraction of the costs in the US, but depending on your location, hospitals and clinics can be smaller with fewer specialists. Medical evacuation out of a foreign country averages about $45,000. Don’t skimp on the coverage. Some policies offer a reimbursement, meaning you pay the costs first and then submit claims. As with all insurance policies, read the information before purchasing.

Buying insurance is all about managing risk. Everyone has a different risk tolerance and budget. You may be comfortable with just the benefits offered through your car insurance or credit card. If you are mainly concerned about the flight cost and lost baggage, consider the offerings through the airlines. If you’re planning on spending a lot of money on vacation or if losing the money would be a hardship, travel insurance through a private company is worth a look. If your travel plans take you out of the US, travel insurance with health coverage is always a good idea.

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