Travel Insurance Shopping Tips
For Summer Vacationers
NEW JERSEY – Department of Banking and Insurance Commissioner Ken Kobylowski reminded consumers preparing for summer vacation to consider whether they need travel insurance – which can cover such things as loss of non-refundable costs in the event of a cancellation or medical costs incurred while on vacation.
“Consumers preparing for a summer holiday don’t always consider insurance coverage issues that might be connected to the trip,” said Commissioner Kobylowski. “Unfortunately, travelers sometimes have to cancel trips; vacationers sometimes become ill; baggage can be lost or damaged, rental cars can be damaged. Travel insurance can help protect consumers when these types of things happen.”
Here are some of the main types of travel insurance and travel related insurance coverage issues consumers should know.
Trip cancellation insurance. This insurance protects against the loss of non-refundable travel costs – such as airfare, hotel or tour expenses in the event of a trip cancellation, delay or interruption. Consumers making a deposit on a cruise or who have non-refundable airline tickets, should consider this type of coverage. As with any insurance policy, consumers should read the policy carefully and make sure they understand which costs are covered and which are exempt.
Medical emergency coverage. This type of travel insurance offers protection against loss due to medical emergencies or death that occurs while consumers are traveling, particularly on cruises or to countries outside of the United States, where existing health insurance coverage may not be valid. This type of coverage, which may contain pre-existing condition and age limit exclusions, can reimburse medical expenses consumers incur while traveling, cover medical evacuation and accidental death costs.
Coverage for damage to baggage and rental cars. Damages to baggage and rental cars may be covered by existing homeowners and auto policies respectively, and consumers should first check those policies before purchasing any additional coverage. Consumers should also check with their insurance companies to determine if those policies are valid in other countries. When coverage is not provided, consumers can purchase insurance for loss or damage of baggage, but should be sure to review the policy for the list of property that is not covered and the value limits associated with the property. Consumers whose auto policies do not cover rental cars, may purchase a rider to their existing policy or may purchase coverage through the rental car agency.
For consumers who decide to purchase travel insurance or other travel related coverage, Commissioner Kobylowski offered the following shopping tips:
• Check existing coverage. Before purchasing additional coverage, consumers should check with their insurance company or agent to determine if their existing standard health, auto and homeowners policies afford any coverage during the trip. Consumers should also check with their credit card companies to see what travel insurance benefits might be provided when paying for travel arrangements by credit card.
• Understand the coverage purchased. Be sure to have a clear idea of covered perils and other policy terms.
• Read your policy carefully. Travel insurance policies carry exclusions that can vary widely from one policy to another. Review all exclusions and make sure they are clearly understood.
• Review the full range of benefits. Make sure the coverage triggers for benefits are clearly understood.
• Shop around for coverage. Get a quote from more than one carrier. If offered travel insurance coverage when booking tickets, especially online, remember other coverage sold separately may better fit travel needs for a better price.
• Beware of fraud. Spam emails, Internet pop-ups and high pressured unsolicited phone calls are just a few of the travel insurance fraud red flags. The best defense consumers can employ is to make sure the company or person selling travel insurance is licensed by the State of New Jersey.
To verify if a carrier is licensed, go here: http://www.state.nj.us/dobi/data/inscomp.htm
To verify if an agent is licensed, go here: https://www20.state.nj.us/DOBI_LicSearch/insSearch.jsp
Consumers who have an issue that they cannot resolve with a licensee can file a complaint in writing here: http://www.state.nj.us/dobi/consumer.htm.