How Does Travel Insurance Work?

Did you know you can sell all or a portion of a life insurance policy, even term insurance?

(4 minute read) 

The summer months are often a time for living out our travel fantasies. Whether it’s an international jetset, or just a quick weekend getaway with family, the enjoyable weather and more open schedule makes for a perfect chance to plan a vacation. However, we’re still living in the world of COVID-19, and it’s possible that those trips will end up being cancelled. With that in mind, travel insurance can help us to recoup some of the losses that come if flights, hotel stays, events, or car rentals don’t actually happen. But how does travel insurance work, and what kind of costs can it protect?

How Travel Insurance Works

Travel insurance is coverage for prepaid costs relating to a trip or vacation. Much like a health or life insurance policy, policy-polders pay a premium in order to insure their bookings. For folks who travel often, it’s possible to have ongoing travel insurance that covers any of your trips; if, on the other hand, this is just for a single event, policy holders can choose to purchase coverage for a single trip. There are a variety of quotes and companies offering the insurance, so prices generally vary.

The standard coverage policy covers events outside of your control, and will be stated directly in the policy. Examples of travel insurance claims include:

  • Illness, injury, or death of a traveler or their traveling companion
  • Illness, injury, or death of a non-traveling family member
  • Terrorist attack
  • Dangerous or inclement weather
  • Natural disaster

Should any one of these events occur, travelers with insurance can then contact their coverage company, file a claim, and request reimbursement for their costs. These policies will all have their own fine print, though, and it’s important to understand what exclusions may exist and prevent you from receiving the money back on a cancellation.

The cost of travel insurance varies based on provider, policy coverage, age of travelers, and length of coverage. However, you can expect for travel insurance to cost between 4%-10% of your total trip cost. So, while that may not be much for a short, single-person weekend trip, the cost of premium may be high for larger family trips.

Does Travel Insurance Cover Coronavirus? 

The Coronavirus pandemic has caused a lot of plans throughout the country to change. While things seem to be opening back up in cities throughout the United States, there is a fear of a second or third wave of infections, particularly this summer or fall. While travel insurance may seem like a good option for staying covered in case of cancellations, a second wave of COVID-19 may not be covered.

In a recent interview, Christina Pedroni, senior vice president of Liberty Travel, said, “If you’re purchasing a standard travel insurance package right now for travel, COVID-19 is already a known event. So, typically, you wouldn’t be covered if you had to cancel because of COVID-19 being in the destination or you being sick from the virus.”

It is, however, possible to get travel insurance that allows you to submit a claim if you have to cancel for any reason at any time. Just be sure to speak directly with a travel insurance agent to find out exactly what you are or aren’t covered for, and how much you’re able to recover should a cancellation occur.

Traveling Safe with Travel Insurance

Traveling is one of the joys of retirement life, especially when it brings us together with family and friends. While traveling in the age of Coronavirus can be a bit nerve wracking, it can be made better with travel insurance that covers you in the event of a cancellation. Just be sure you’re checking directly with the insurer to find out what coverage you have.

Did you know you can sell all or a portion of a life insurance policy, even term insurance? Selling an unwanted life insurance policy is no different than selling your car, home or any other valuable asset that will create immediate cash. Contact us today to learn more.

Leo LaGrotte
Life Settlement Advisors
llagrotte@lsa-llc.com
1-888-849-0887

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