When looking for a low cost travel health insurance policy, start by determining your needs

As you might know, there are 2 general types of travel insurance. Insurance, in simple terms, is a form of financial protection. You pay a little money (the premium), in exchange for the promise to pay the larger expense if something happens.

The first step in finding the right trip insurance policy for your vacation or business trip is asking yourself what exactly you need to cover?

Here are the 2 general types of travel insurance:

1. Travel Health Insurance- Also known as travel medical insurance, this is meant to replace the medical coverage you have at home. While visiting a foreign country, your insurance from home (i.e. Blue Cross, Harvard Pilgrim, etc.) may not cover your expenses. Medicare is definitely not effective abroad. This type of insurance covers accidents, illness, hospital care, and usually medical transportation.
2. Trip Cancellation Insurance- This type of insurance is meant to cover your financial investment in the trip. When you organize a vacation, you commit to spending a large amount of money on hotel rooms, airfare, rental cars, special tours, etc. If you need to cancel the trip, you are still responsible for many of these expenses, and you would lose that money. A trip cancellation policy provides financial protection against canceled vacations, reimbursing you for non-refundable, covered expenses.

How to find a low cost travel health insurance policy

If you decide that you want a travel health insurance policy, it’s time to get a quote. Use a comparison site to see instant quotes from several companies (see How to Compare Quotes with a Travel Insurance Comparison Site). Make sure you are looking at the “Travel Medical” policies, and not the “Trip Cancellation” policies.

You may notice that there is a price difference between some of the different products. That is because each company offers various coverages and coverage amounts. This is where you should read through the different policies and make sure you are comfortable with the benefits.

Also be sure to read through the “Exclusions” section of the policy. You can find this in the “Certificate”, which is usually a download-ready document that spells out the specifics of each policy. The “Exclusions” section lists risks that are NOT Covered under the policy. For example: most companies will not cover injuries sustained while intoxicated, such as a drunken fall down a set of stairs.

Click and buy

Once you have found a policy you like, you can click and buy, right online. The policy will be mailed to you, and most travel insurance companies will email a confirmation as well, with all the policy details. Again, a great way to compare different policies from various carriers is with a comparison site (see How to Compare Quotes with a Travel Insurance Comparison Site)

The financial benefits of travel insurance for your next trip

Consider the following scenarios:

You’re at the beach somewhere warm, sunny, and exotic. You’re just there for a few short days—one of those special last-minute internet deals. You go out a little farther from the shore. Suddenly, you hear a menacing sound, some sort of low-pitched stringed instrument going “Da-dum…da-dum…[faster] da-dum da-dum da-dum—” No, it’s not Jaws, just your imagination. But in your sudden panic, you flail a little going back into shore, and your foot comes down into the sand hard. You feel a sharp pain. You stepped on a fishhook and it looks like a deep puncture wound. At first, you think that you can just limp back to your hotel, clean out your wound, and resume your activities in tropical paradise. But then you remember you haven’t had a tetanus shot in years. Since you were only going to be away for a few days, you didn’t get any travel insurance. Several hours and several hundred dollars later (assuming there’s even a hospital in your island paradise), you’re back on the beach, just in time to leave.

Or, you’re traveling from Portland, Oregon to New York with a connection in Chicago. Your connection time is long enough that you’re confident you’ll make it. It’s a business trip, and your suit is in your checked luggage. But your plane is delayed leaving Portland. Upon arriving in Chicago, you sprint to make your connection, because your meeting starts a couple of hours after you get to New York and you can’t be late. You make it, but your luggage doesn’t. The airline delivers it to your hotel…after you’ve flown back to Portland. Later, the hotel claims they don’t have it. Somewhere, someone is enjoying your favorite suit.

Or, you’re getting married in a few weeks, and you book a 3-week honeymoon in Tahiti. You both wanted the best of everything for this once-in-a-lifetime romantic getaway. You booked a resort that offers daily massage, snorkeling and scuba diving. Your honeymoon costs more than your wedding, and you can’t wait. Sadly, on the night of the wedding, your father has a heart attack and winds up in critical condition at the hospital. At first, the doctors aren’t sure if he’ll make it or not. He does recover and is able to go home after bypass surgery, but you’ve stayed by his side the whole time, and your honeymoon will have to be postponed.

In any of these situations, travel insurance would have saved you anywhere from several hundred to several thousand dollars. Whether you need medical care, luggage replacement, or trip cancellation insurance, travel insurance is typically only a few dollars per day of your trip (with additional fees for especially risky activities). Some trip cancellation insurance allows only specific reasons for cancellation, so check ahead of time—it might be a good idea to get the kind that allows you to cancel for any reason. It’s a smart financial decision to pay a few dollars up front rather than risk losing a serious chunk of your savings in addition to your honeymoon, your favorite suit, or your precious time on the beach.

Seeking cheap family travel insurance for your next trip?

Family vacations are a great way to show your kids parts of the country or world they haven’t seen before. Although fun and even educational, they can also come with headaches since family travel requires a lot of planning and preparation. That’s where cheap family travel insurance can be convenient.

It covers some of the unexpected things that can happen during a family trip so that the only worries a family has is whether to pull over for ice cream or not. Travel insurance for families can cover things like lost luggage, or liability and damages to a rental car.

Baggage coverage provides well-deserved peace of mind

Traveling by air with very young children can require a lot of extra paraphernalia—strollers, carseats, extra diapers, etc. With luggage coverage you don’t have to worry about where the bags are or how they are being handled every minute of your trip—or how expensive it might be to replace them. Instead you can relax, and know that whatever happens is covered by your insurance. It is important to remember however, especially with cheap family travel insurance, that there can be policy exclusions. Be sure to check the “fine print” for the “exclusions” section. Read it thoroughly before taking off.

Travel insurance for families helps remove some of the stress that comes naturally with travel. Losing that important piece of luggage, like clothes packed for the week or other valuables, can throw a wrench in the trip in a hurry, but insurance coverage can make it easy to replace items without damage to your wallet.

Last minute illnesses can cost you plenty if you need to cancel

If you get trip interruption insurance, and your trip is cut short by an accident, illness, or other reason, you won’t be liable for nonrefundable costs like hotel reservations.

Similarly there can be a lot of stress involved with driving a rental car, especially with kids in the back asking “Are we there yet?” If collision coverage is included in your travel insurance, you can remove the stress of driving a rental car before you even hold the keys, at a cost that will likely be less than what the rental company would charge for similar coverage.

Be thorough when reading the “fine print”

Read all policies carefully in order to make the best decision. Since driving an unfamiliar car in a different state or country can increase your risk of accidents, this kind of coverage is helpful and lets the you focus on getting where you want to go instead of worrying about how you are getting there.

Retired travelers…Need help for over 65 travel insurance?

When you’ve reached the golden years of your life and you’re ready to take that big trip you’ve been planning for so many years, you’ll want to be sure that nothing is going to spoil it for you. No matter how much planning goes into the trip, it’s always helpful to have insurance for the unexpected twists and turns of travel. There are many options for travel insurance for retirees, but it may not be immediately apparent how travel insurance might help. However, even for those who are perfectly healthy, unexpected reasons may arise that could lead you to cancel your trip or even need a medical evacuation.

That’s where one of the helpful benefits of over 65 travel insurance (for retirees) is so essential. Coverage for trip cancellation means that if you or your spouse don’t feel well before traveling, you can cancel the trip without penalty. Of course no one wants to miss a trip they have planned for months, but having trip cancellation coverage means that you can put the trip off for another day in case there is a medical emergency or illness. If you’re living on a fixed income, having trip cancellation insurance means that you will be able to go on your trip another time without detriment to your finances.

Medical issues while abroad are not covered by Medicare

The second important reason for retirees to have travel insurance is in case of a medical issue abroad. There’s no limit to the places you can travel during this period in life, but it’s important to make sure that wherever you go your medical needs are covered. This travel medical insurance not only means that you and your spouse are covered for medical emergencies, but also that you have the peace of mind that comes with coverage. Bear in mind that insurance costs do rise for those over 50.

Travel is much more enjoyable when you are worry free. If you have full insurance coverage, including medical evacuation coverage, you won’t have to worry about substandard medical care or about having emergency surgery far away from home. You can truly get away and enjoy your trip, whether you’re cruising Norway’s fjords or you’re on safari in Kenya. And after all, isn’t that why we travel in the first place?

“Does my medical insurance cover me when I am abroad?”

You might assume that your regular medical insurance covers you abroad, and you do not need travel medical insurance. This is a common misconception. If you’re lucky, your regular medical insurance may cover some medical services abroad. Chances are, it covers only emergencies, or offers no overseas coverage at all.

However, even if your insurance will cover your medical care, the amount and quality of care you may receive will vary widely. In some cases, you may have to wait much longer to receive medical care, or the medical care will be below the standard you’re accustomed to, or, at the very least, you’ll have a bureaucratic paperwork nightmare on your hands.

Furthermore, even if your regular medical insurance covers you overseas, it is almost always guaranteed that you will have to pay out of pocket and then wait for reimbursement. As you can imagine, this can be financially difficult or even impossible for the average vacationer. Should you encounter a medical emergency abroad, you may wish to be evacuated; this can cost over $50,000 and is not generally covered by regular health insurance.

Good travel medical insurance can save you worry and financial difficulty in the face of a health emergency, and can also make your life easier in the event of more minor issues such as needing treatment for a sprained ankle or stitches for a cut. Read your policy carefully to ensure that it meets your needs, and choose travel insurance that will pay medical costs directly rather than reimbursing you when you pay out of pocket.

A good travel medical insurance policy has several coverages

Travel insurance coverage can include not only medical evacuation, treatment, and hospital stays, but also lost luggage or trip cancellation insurance. You should be able to find cost-effective coverage no matter what the length of your trip. Be sure to take into account special circumstances such as preexisting conditions, pregnancy, vulnerability to regional diseases or natural hazards, and risky outdoor activities. At the very least, be certain to have coverage for emergency situations that includes medical evacuation if necessary.

How many travel insurance companies are there?

As an industry that is still growing, especially in the United States, there are more and more travel insurance companies emerging all the time. As of right now, there are roughly 2 dozen companies that market, administer, and issue trip and travel insurance coverage. They range from big-corporation spin-offs like AIU’s Travel Guard, to independent upstarts that have entered the market in the past 15-20 years, like CSA Travel Protection and Seven Corners.

Even though are a several companies to choose with many different policies, there are ways to help you figure out the best one for your trip. At the end of this article, we’ll provide you with some links to comparison sites that let you compare rates from all major companies at the same time.

What exactly do the insurance companies do?

The job of the individual travel insurance companies is simple: they design the product (the policy), they market and sell it, then administer and issue the policy. But it doesn’t end right there. They are also there for a very important reason; possibly the most important when it comes to insurance: support.

Imagine you are traveling in Laos on a 3 week honeymoon. While embarking on a cycling day-trip through the countryside, your new wife takes a tumble and breaks her wrist. What now? You are in the middle of a foreign land, where you do not speak the language, don’t know anyone, let alone the best hospital to take her to. Not to mention how you get her there. This is where good support plays a part.

The insurance companies have support centers with trained insurance professionals that can answer your question; before and after the purchase. They will handle claims and claim questions as well. They provide assistance in foreign countries, help you find a hospital, and even to get through language barriers. They can arrange special transportation if the nearest hospital is not adequate.

The ability of a travel insurance company to provide great support is a very important factor in making your buying decision.

How do I know these travel insurance companies are reliable?

I have written another post on this specific topic; how can you know that you are buying travel insurance from a reputable company? There are a few trustworthy organizations that give credibility to the different trip insurance companies; here is a brief review of them.

The official rating company in the insurance industry is A.M.Best. A.M.Best is a full-service credit rating organization dedicated to serving the financial services industries, including the banking and insurance sectors. They have ratings for every reputable and trustworthy insurance company; on a letter scale (A+, B-, etc.) This a good place to check when you are not sure about a certain company.

The US Travel Insurance Association (UStiA) is a group whose mission is to, “…foster ethical and professional standards of industry conduct, cultivate effective state and federal government relations, inform and assist members, and educate consumers.” Representatives from various travel insurance related companies act as Officers, and travel insurance companies and related companies can pay a membership fee and be listed as members. UStiA does not rate companies, but their membership, and therefore inclusion in the group, helps credibility.

How can I compare rates from the different insurers?

There is actually a very simple way to compare different plans from the different travel insurance companies. In the “old” days (10+ years ago), booking airfare was a very different process than it is today? People typically used a travel agency, or spent hours on the phone with customer service representatives from United Airlines, Northwest Airlines, TWA, and others. You would writing down the different times, connections, and fares. Then you would compare all the prices; and figure out when you wanted to leave, when to return, etc. Sound familiar?

Then along came Expedia, Travelocity, and the other online travel sites. They took the role of travel agent, and made it easy for us to look at all the available airfares from several airlines, and compare prices side-by-side. Much easier, right?

The same thing exists for the travel insurance companies. Instead of using an agency, or calling the individual companies, you can go to comparison websites and see all the different plans, compare the coverage, and even compare quotes (NOTE: in the travel insurance industry, you are able to get instant, accurate quotes for your travel insurance premium. You don’t need to submit your information and wait for an email or call; you can get a quote for travel insurance in less than a minute.)

The other nice thing is that you can instantly purchase and bind coverage, right online. Using a credit card, travelers can get a quote and purchase their policy instantly. The companies generally mail the policy out to you, but you will also receive an email with all the important policy information. You can print this out and get right on the plane.

Related Links
How do I know my travel insurance company is reputable?
3 Steps to finding the right travel insurance
Who has the best coverage for lost luggage?

First, you need to decide what coverage you need
You need insurance for your vacation. But how do you find the right policy, and how do you know that is the smart choice? The answer: 10 minutes of homework.

Figure out what kind of coverage you need. If you are worried about getting sick and missing your flight, you need coverage for missed flights. If your elderly mother is ill and might take a turn for the worse, you need trip cancellation coverage that covers illness to family members. If you just worried about getting sick while abroad, you need travel medical insurance. You get the idea.

Jot down your thought about what you want to cover. We’ll use this in a few minutes.

Be ready to purchase right away
There are big benefits to purchasing your travel coverage immediately after booking your trip. The biggest “problem area” in trip insurance, the issue that causes the most misunderstandings and aggravation, is the Pre-Existing Medical Condition. Essentially, travel insurance companies need to exclude illnesses and injuries that happened before their coverage began. If you are diagnosed with a condition in January, but buy insurance in March, that won’t be covered. You didn’t have insurance when it happened.

There is something you can do, however. Many travel insurance companies offer a Pre Existing Medical Condition Waiver. To qualify, you must purchase your insurance within a certain period of time of your first trip deposit. This period is usually 10-15 days.

So, if you are planning on buying travel insurance, there is a huge advantage in getting it right away, even at the same time as booking your trip.

Compare prices with a search engine
When you search for airfare, you probably use a search engine like Expedia.com or Orbitz.com, right? Most people do, because that way they can compare different airlines prices, flight times, layovers, and service. That’s the smart thing to do.

Well, the same is true for travel insurance. There are several websites where you can enter your trip dates, and a few other pieces of information, and get instant quotes from all major carriers. Then, while considering the prices, you can compare their coverage and find the right policy.

Use a travel insurance comparison site
Comparison sites have built  very simple sites, and made it easy to compare coverage. When you find the right company, just click “buy”. You can enter your credit card information and personal information in a secure site. Once complete, you will receive a confirmation email immediately. Then you’re ready to go (see How to Compare Quotes with a Travel Insurance Comparison Site)

New York Times article about business travelers and the need for world travel insurance
In an online article from the New York Times, a great story about business travelers and their need for worldwide travel medical insurance. The story stresses the need for companies to provide this coverage for it’s employees, and making sure you are properly covered. They particularily stress emergency medical evacuation, which can be extremely costly.

Medical costs and evacuation can easily cost over $100,000
Getting sick overseas, or anywhere in the world, can be a vary scary experience. There are language issues, local customs, local conditions, facilities, and payment systems. The need for an evacuation is even worse, because you need to be put on a transport, such as a medically equipped airplane, with trained nurses. These costs can easily total in the hundreds of thousands of dollars.

Around the world, travel insurance will protect you
If you travel for business, make sure your employer has taken the proper measured to ensure you are covered. Don’t wait until something happens. The time to check is now, before you even depart. Also make sure your policy includes medical evacuation coverage, and a 24/7 help line that you can call in a time of need.

Related Links
How do I know my travel insurance company is reputable?
Who has the best coverage for lost luggage?

Finding the right travel insurance can be difficult. There are many products to choose from, and all travelers have different needs. This simple guide will help you find the right coverage for your trip.

1. Determine your needs

Ask yourself this question and write down the answer:

“What are my 3 biggest concerns about this trip?”

Some people want to make sure the cost of their trip is covered if they need to cancel, others want their health and medical needs covered by travel medical insurance. Maybe you have a nice new set of luggage to protect, or you heard about the astronomical cost of emergency evacuation.

Everyone looks for travel insurance to cover different needs. You need to determine what your needs are, and find the policy that works best.

For more help understanding travel insurance coverage, check our Travel Insurance 101 guide.

2. Compare all quotes from all companies

This is actually quite easy. Instead of visiting several different websites and getting trip insurance quotes one at a time, use a comparison engine. These work much like Expedia .com, where you put in the trip dates and see all the options from all companies at the same time. Then you can decide based on features.

(see How to Compare Quotes with a Travel Insurance Comparison Site)

3. Match the plan that fits your list

Start looking at the different plans, specifically checking the coverage for the 3 things you wrote down earlier. If the coverage is the same for one area, check that off your list and move on to the next one. If they all offer similar coverage, you can then simply shop based on price.

Some products, however, will offer better or worse coverage than others. If you find a company that offers better coverage in one of your chosen areas, you have a reason to choose them over the rest. This is where price is not a concern, but getting the right coverage is.