Travel insurance is a relatively new insurance product and when travelers see advertising for travel insurance that says it covers trip cancellation and evacuation and baggage, they believe it will cover accidents of all kinds.

The truth is that travel insurance is just like any other insurance product – you gotta read the policy.

You already know the kinds of things you can’t do and expect your homeowner’s or automobile policy to pay up, and now it’s time to start understanding what travel insurance covers – and what it doesn’t. We’ll review some of the top travel scenarios that cause traveler confusion and explain how it works.

1. “I bought a travel insurance policy that covers trip cancellation, and I had to cancel my trip; now why won’t the travel insurance company reimburse me?”

The reason for your cancellation is the key here. You must understand the covered reasons for trip cancellation according to your policy. For example, one policy may reimburse your pre-paid trip costs if you have to cancel because you lost your job; but the policy may also stipulate that you have to have been employed at the same company for a defined number of years. Another policy may let you cancel due to an illness in the family, but you must be sure that the family member is covered. For example, if you are cancelling because your sister-in-law is ill and you have to help take care of the kids – does your travel insurance policy consider a sister-in-law a family member? See your description of coverage and look for the definition of ‘family member’ to find out. See our full review of trip cancellation coverage to understand how this travel insurance coverage works.

2. “I have travel medical coverage with my travel insurance policy, and I got ill while on vacation. Now, why won’t the travel insurance company says it was a pre-existing condition and they won’t reimburse my expenses. Why?”

A travel insurance company, just like a health insurance company, has to consider pre-existing conditions and pre-existing medical conditions are excluded by default from every travel insurance policy. A pre-existing condition is “any injury, illness, disease or other medical condition that occurs prior to the travel plan’s effective date and for which you had symptoms and sought diagnosis, medical treatment, and/or new prescription medications or a change in your current prescription.” If you have seen a doctor for any treatment during the look-back period (which is the 60 to 180 days prior to your travel insurance purchase), and you get sick on your trip, that illness must be completely unrelated to your previous doctor’s visit to be covered. See our full review of pre-existing medical condition coverage if you suspect that may be a factor on your trip and consider purchasing the pre-existing condition waiver.

3. “I got a little drunk at a party and fell off a chair and broke my ankle. Now, my travel insurance company is refusing to pay the medical bills. I don’t understand.”

In every travel insurance policy, there is a list of exclusions and in each of those lists, travel insurance companies limit their losses if you get drunk or take drugs. Check the list of exclusions in your policy and you will find text similar to the following: “We will not pay for any loss under the plan caused by or resulting from: being under the influence of drugs or intoxicants.” If it’s drugs that got you into trouble, you’re really out of luck because travel insurance also excludes any criminal acts that you commit and criminality is determined by the local laws, not the laws back home. See our full review of travel medical coverage to understand what is and isn’t covered when you’re on a trip.

4. “I was on vacation in Costa Rica and we had the opportunity to bungee jump. Unfortunately,  I hit the bridge on the rebound and broke my collar bone and wrist. My travel insurance company is refusing to reimburse my medical bills. Why?”

When you’re on vacation, it’s understandable that you want to try all the activities you can. After all, when will you get the change to bungee jump again after you get home? Still, the reason you are being denied coverage is right in your policy, under the list of exclusions. Almost all travel insurance plans specifically refuse to cover activities like mountain climbing, rock-climbing, bungee jumping, sky diving, hang gliding, para gliding, and even para-sailing (a popular activity at all-inclusive resorts). Check your list of exclusions before you sign up for that once-in-a-lifetime activity and consider purchasing a travel insurance policy that covers adventure activities.

5. “We purchased travel insurance for our cruise, and a mechanical failure caused our connecting flight to be delayed two hours and we missed our cruise departure. Now, the travel insurance company is refusing to reimburse our costs. I thought travel insurance was supposed to cover these things!”

As with any coverage, it’s important to read the fine print. Missed connection coverage requires that the traveler allow enough time in their planned itinerary to reach the flight or cruise departure. If you have a tight connection time and are landing a short time before your cruise departure, the travel insurance company may claim that you didn’t allow enough time for travel. Also, missed connection coverage, just like travel delay coverage, often requires that you are delayed a minimum number of hours (usually at least three). In this case, it’s likely that the flight delay wasn’t enough to meet the minimum number of hours. That combined with your compressed travel times is enough for the travel insurance company to deny your claim. Read our full review of missed connection coverage to understand how this coverage works.

6. “I was on a business trip in Egypt when the civil uprisings grew violent and I wanted to leave. Unfortunately, my return flight wasn’t for another week but it appears they may close the local airport anyway. I just want to get out of here!”

In the event that an emergency situation occurs, and you are in imminent danger while traveling in a foreign country, the right coverage on your travel insurance policy will help you and any insured dependents be evacuated to a place of safety. Not all travel insurance policies have security or political evacuations in their coverage; in fact, most specifically exclude coverage for war, civil uprisings, military action, and other similar dangers. If you are traveling to a country where the political situation is tense, it’s important to review your policy and be sure that you have the coverage you need for the situations that could arise on your trip. See our review of security and political evacuation coverage and consider contacting your travel insurance assistance services hotline if you have questions about your safety on your trip.

7. “I was on vacation in Hawaii with my daughter when we discovered that our hotel room had been ransacked while we were on the beach. Our camera, money, cards, and smart phones were stolen. Now the travel insurance company is saying they don’t cover those things and I don’t understand.”

While baggage coverage from a travel insurance company, unlike the baggage protection you get with the airlines, covers your belongings even after you leave the airport, this coverage is like any other coverage in that it has limitations. In all travel insurance plans that include coverage for baggage and personal belongings is a list items that it will not cover. These items typically include jewelry, cameras, sports equipment, electronics, laptops, cash, and bank cards. If you read your travel insurance policy you’ll notice that there are items that are specifically excluded: money, credit cards, eye glasses, documents,, and more, and there are items that are subject to special limitations. These include jewelry, watches, electronic equipment, cameras, and more. Items that are subject to special limitations are covered only up to the limit defined in the policy and that limit is separate from the policy limit or the per-item limit. Read our full review of baggage coverage to better understand your travel insurance plan.

News of death – especially deaths that occur on vacations – are sensational. Like the 26-year old U.S. tourist who died on a Bahama cruise or the three skiers recently killed in a Washington avalanche.

Whether a traveler is traveling solo, with friends, or with family, it’s important to remember that if a death occurs on any trip, your body isn’t automatically shipped back home for burial. In fact, it’s stored in the local morgue and local laws govern how long it can wait before being collected. Transporting a body can take a lot of money and coordination to properly prepare and ship it back home.

One travel insurance coverage no traveler should leave home without is repatriation. Often lumped together with medical evacuation coverage, repatriation is a fancy word arranging for and transporting a covered person’s body to his or her home or to a nearby funeral or cremation facility. Having this benefit with your travel insurance plan means your family won’t have to pay for the unexpected costs related to collecting and shipping your body home for burial.

Each country has their own laws and regulations governing how a body can be transported. Many require a good deal of paperwork – paperwork and coordination that must occur in the local language.

Even if you are traveling with family members, they won’t have to navigate the complications of transporting your body home. With repatriation coverage included in your travel insurance plan, you’ll have assistance services representatives to coordinate and manage this responsibility. Similar to life insurance that leaves those depending on you a little safer financially should you die, repatriation insurance ensures that they’ll have the help they need to coordinate your body’s return home if you die on a trip.

In 2011, the Better Business Bureau (BBB) received over 7,000 complaints nation-wide regarding travel agencies. Many travelers still prefer to work with a travel agent rather than making their travel arrangements on their own using Internet resources, but choosing the wrong agent or agency can lead to disappointment.

1. Do your own research. A personal referral always carries more weight. Ask your family members, friends, and business partners who they use and go to bbb.org to see how they rate.
2. Use an agency you already know. If the company you work for uses an agency for their business travel and you like how they take care of you on business trips, ask if they are willing to help you with personal trips and vacations as well.

Interviewing a travel agency or travel agent

When you think you’ve got a travel agency you like, you’ll want to interview them. Here are some things to ask them:

1. Ask whether they provide trip details in writing and ask to see an example. Does it include the details you need to contact the travel agent, the airline, car rental companies, hotels, etc.? If not, you may not have the information you need if a worst-case scenario occurs.
2. Ask how they help travelers in an emergency – what they can and cannot do. Travelers stranded in natural disasters, accidents, and medical emergencies can call their travel insurance assistance services for help and even evacuations (depending on the plan). Be sure your travel agent can do at least the same.
3. Ask about their trip cancellation and refund policies and review them carefully. Travel insurance lets a traveler cancel their trips for covered reasons, so be sure you know what the covered reasons are with your travel agent.
4. Ask if they provide pre-trip vaccination, currency, passport, and weather information. See our post on a family who was turned away at the border for a 3-month passport validity requirement their travel agent should have warned them about.
5. Ask if they are travel insurance agents and which travel insurance companies they represent. (You can also review travel insurance companies here too.)

After choosing a travel agency or travel agent

It’s important to remember that your travel agent isn’t taking the trip – you are – and if things go badly your travel agent may be able to help but you’ll still be the one doing the suffering. You, and your family, that is so it’s important to remember a few steps to protect yourself.

1. Pay with a credit card. If things go wrong, you’ll have some financial protection and you may have some (but not a lot) travel protection with your credit card as well.
2. Verify and print your vacation details, trip insurance details, and reservation details to take with you. See our recommendations for what to take with you on your trip.

If you’re a traveler who prefers not to do all the research and make your own travel plans, then working with a travel agent may be a good idea. Just be sure you understand what you’re getting for your money.

As reports of a bomb blast in Bangkok circulated last week, travelers are reminded that they should think carefully about what to do should a bomb go off where they are traveling.

What should you do if a bomb goes off in the street where you are walking?

Although you may be tempted to remain and render assistance, the experts advise immediately leaving the area where a bomb has exploded for two reasons:

1. Unless you are a medically trained expert, it’s unlikely that you’ll be able to offer the injured much assistance, and
2. there is always the chance of a secondary explosion timed to cause additional damage and wreck rescue operations.

It’s a horrible scenario, but it’s been proven true over and over again. Terrorists will time their bombings to hit once and then hit again to cause additional damage.  Leave the heroics to the local authorities and get as far away from the scene as possible, returning to your place of lodging where you can monitor the news and let folks know your condition and whereabouts.

While there is little to no value in over-worrying, it is worth your life to stay aware, pay attention to the security levels at public places where tourists are likely to congregate. If you must travel to places where the risk of terrorism is high, register your trip details with the free U.S. State Department’s Smart Traveler Enrollment Program. When you sign up, you’ll automatically receive the most current information about the country to which you will be traveling and you’ll receive updates and warnings. Plus, the government will be better able to assist you in the event of an emergency.