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Can Travel Insurance Save Your Vacation?
By Peter Greenberg
Oprah.com   |   May 04, 2010
Do you need to buy travel insurance?
Earthquakes, volcanoes...and now hurricane season is around the corner. Is it the end of the world? Probably not, but no matter what state the world is in, it pays to be prepared when you're on the road. Get insider help on buying travel insurance from Peter Greenberg.
Travel insurance is one of the things you hope you never need—but when you do need it, you'll be glad you have it. There is no magic number when the benefits of travel insurance outweigh the cost, but use common sense. Insure anything you can't afford to lose.

If you're visiting dear Aunt Myrtle in Wichita on a $400 ticket, you might want to skip it. But if you're booking a pricey trip, or one with a lot of moving parts, travel insurance can really save the day. Just talk to someone whose flight to a cruise port got delayed, or who got stranded by a hurricane, or lost his medication on the road, or realized that her passport and wallet had been stolen.

Read the top 10 reasons for travel insurance at PeterGreenberg.com.

For most travelers, insurance offers peace of mind. Before September 11, it was estimated that only 8 to 9 percent of leisure travelers in the United States purchased some type of travel insurance. Today it's more like 30 percent.

The most common type of travel insurance is for trip cancellation and interruption. The former is to protect your upfront financial investment should the trip be canceled; the latter is protection for emergencies and "what if" situations while traveling.
The other bonus of travel insurance is that most reputable companies offer 24-hour global assistance. Those contacts can act as your advocate in terms of securing last-minute hotel rooms, finding a local doctor, dealing with lost documents or even arranging for your evacuation. More comprehensive plans may include emergency medical, dental and car rental insurance on top of trip delay, cancellation and baggage coverage.

But that brings us to the dreaded fine print. No two travel insurance policies are built alike, and some have loopholes so big you could drive a Hummer through them. Always find out what is included and, more important, what's excluded in your covered benefits. You might be surprised to see how long that list of exclusions is—civil unrest, acts of war, pandemics and natural disasters (also known as the exact reasons you need insurance).

You know those folks stranded by clouds of Icelandic volcanic ash? Guess what some companies are filing that under? You guessed it, it's a natural disaster. Fortunately for other travelers, this being (hopefully) a once-in-a-lifetime event, other companies decided that the wind carrying the ash is "adverse weather," not a natural disaster. But guess what? Even when the policy does cover natural disasters, you might not be covered if your location is still habitable and the airports are still open! 

Read more about travel insurance in the wake of the volcano eruption at PeterGreenberg.com.

Getting stranded by volcanic ash is unlikely. But getting caught in a hurricane is much more common, especially now that the Atlantic hurricane season runs from June 1 through November 30. This comes with its own list of exclusions. You cannot purchase travel insurance once the storm has been named by the National Hurricane Center—after it's been named, a hurricane is considered a "foreseen event." And you certainly won't be reimbursed if you get to your destination but your tropical vacation is ruined by gusty winds and torrential rain.
Finally, there's the type of insurance that not a lot of people know about: medical evacuation. When you're traveling abroad or in international waters, health insurance generally doesn't apply. But if you get seriously ill or injured on the road, you still need to be treated and may even need to be repatriated back home. This kind of emergency could cost you tens of thousands of dollars!

Right now, medical coverage and evacuation-only policies cover just a fraction of the total market—about 5.5 percent of travel insurance sales. But this coverage niche has increased by about 33 percent since 2006. I personally carry a MedJet Assistance card, which will not just evacuate me to the nearest facility but, if it's appropriate, will take me to the hospital of my choice—not the one that protects their bottom line.

Other companies like MedEx and OnCall International offer similar protection—but again, read the fine print to find out if they'll simply evacuate you to the nearest appropriate hospital and at whose discretion—yours or theirs. 

Learn more tips on travel insurance at PeterGreenberg.com.

When purchasing any policy, never buy it from your travel provider. If the company goes belly-up, so does your policy. Check out a resource like InsureMyTrip.com, which compares different policies among established companies. Plans come in all shapes and sizes, from the most stripped-down "light" policies to the Cadillac versions that allow you to cancel any time, for any reason. If you're not sure, find out which insurance company is underwriting the policy, not just who's selling it. If you're not familiar with the company, check out its credentials through A.M. Best, an international insurance rating agency, or the Better Business Bureau. Also check for membership in the U.S. Travel Insurance Association, which has a list of member companies that must adhere to strict legal and ethical standards.

And remember, while you're on the road, that it's crucial to keep a paper trail. That includes travel records and all receipts in case you have to file a claim for travel delay, medical treatment, lost luggage or any other unforeseen situations.

CBS News travel editor Peter Greenberg has been named one of the most influential people in travel. Read his valuable travel advice at PeterGreenberg.com.

Have your travel plans ever been altered by a natural disaster? Share your best vacation horror stories in the comments area.

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Printed from Oprah.com on Friday, May 24, 2013
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