Americans look forward to beaches, sunny skies and European culture.
With potential issues of flight cancellations, delays, winter weather and – yes, always – Covid looming on the horizon, consider purchasing travel insurance to help when the unexpected overshadows your vacation.
Sun, sand and Europe are a must
Domestic travel is popular this year during the holiday season. This makes sense given that many travelers visit relatives for the holidays.
But for some, a trip south of the border is better than visiting relatives. Four of the top 10 holiday destinations this year are known for their gorgeous beaches.
European countries are also popular holiday destinations, according to travel insurance comparison site Squaremouth.
Mexico, Bahamas, Israel, France and Germany are the most popular destinations for people who only purchase travel insurance for their holidays through the United States.
The most popular travel destinations in 2022
International planes spend more than domestic travelers
Vacationers leaving the country this year have certainly not been stingy – the average cost of a trip is just over $6,000. Foreign travelers spend an average of $470 more on trips abroad than those who stay in the United States.
Average vacation and travel insurance spending in 2022
No covid yet. 1 problem for travel insurance buyers
Although travel restrictions have been eased or lifted to many destinations, travelers remain concerned about Covid.
Finding Covid travel insurance has become the biggest challenge for US travelers buying holiday travel insurance. Nearly a quarter (22%) specifically looked for travel insurance plans that include Covid coverage and purchased a plan that covers Covid-related issues.
The main fears of vacationers
Compulsory travel insurance for holiday trips
"The holiday season is a fun and festive time of the year, but it's also a very busy time to travel," said Daniel Durazo of Allianz Partners USA, who oversees Allianz Travel.
“Between annual family reunions and a wishlist vacation, it's important to protect your travel investment and gain peace of mind with a travel insurance policy that's right for your vacation. This is perhaps the best holiday gift you can give yourself this year.
You should look for a travel insurance policy that covers the following:
- Trip cancellation
- Trip delay
- Trip interruption
- If you have multiple flights, consider insuring missed connections.
- In addition to these benefits, international travelers must also have travel insurance to cover medical expenses.
It is very important to read the travel insurance documents carefully to understand the amount of your travel insurance benefits. Here's how the benefits might apply in typical vacation travel scenarios.
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Trip cancellation insurance
Travel insurance trip cancellation coverage provides protection against financial loss if you are unable to travel due to unforeseen circumstances.
For example, let's say you've planned a sunny family vacation in the Turks and Caicos Islands, booked a few rooms at a boutique hotel on the beach, and even chartered a boat. . snorkeling for a day of personal adventure. Many of these transportation costs must be paid in advance, especially during the peak season.
If you fall on an icy road and break your ankle, your trip to the tropics may be interrupted. Trip cancellation insurance usually covers injuries sustained by you, your travel companion and family members, so you can claim 100% reimbursement of non-refundable prepaid travel deposits.
Trip cancellation benefits generally also apply when you cancel your trip due to inclement weather, sudden family circumstances, death of a travel companion or close family member, unscheduled jury duty, national transportation holidays, or military orders.
It should be noted that not all cancellation reasons will be covered by travel insurance. For example, let's say your weather app shows five consecutive days of rain in a tropical country, and you don't want to spend your holidays playing board games and watching movies. You will not be able to request a trip cancellation.
Travel insurance "Cancellation for any reason"
For maximum flexibility when changing travel plans – due to issues such as rain forecast, travel issues, change of mind or family disagreements – consider updating your travel plan. Standard travel insurance (CFAR) for cancellations for any reason, including travel coverage.
This coverage allows you to cancel your trip for reasons not covered by standard trip cancellation insurance while still receiving compensation.
CFAR coverage has its own rules:
- The refund is 75% of your non-refundable deposit, not 100%.
- The purchase window is usually 14-21 days after the first deposit for the trip. You will no longer be able to add CFAR.
- You must cancel your trip at least 48 hours before the departure date.
CFAR reduces the cost of basic travel insurance by an average of 50%. But it's the coverage that you should consider if you want maximum flexibility to save on travel and get reimbursed.
Travel delay insurance in case of holiday cancellation
“Travel delay coverage will be on everyone’s wish list this year as vacation travel increases with expected delays and cancellations,” Durazo said.
Travel Delay Insurance will compensate you for additional costs you may incur if you are delayed for the reason stated in your policy. These expenses may include food, transportation, and lodging.
Travel Delay Insurance also reimburses you for prepaid travel expenses for the portion of your trip that you missed due to the delay.
“Minimum retention times and coverage limits will apply, so check your policy for details,” Durazo adds. For example, you may have to wait six to 12 hours for your travel delay benefits to take effect.
Winter pain insurance
“Most travel insurance policies include coverage for weather-related flight delays and cancellations. Travel insurance, like any other type, is designed to cover only unforeseen circumstances. Once. it's called storms, insurance coverage no longer applies," said Megan Moncrief, spokeswoman for travel insurance comparator Squaremouth.
The Weather Channel names winter storms when they meet at least one of the following criteria:
- A National Weather Service winter storm, snowstorm or ice storm warning covering at least 2 million people.
- A National Weather Service winter storm, snowstorm, or ice storm warning covering an area of at least 400,000 square miles, or slightly larger than the state of Montana.
“Vacationers whose trips involve winter conditions should consider taking out an insurance policy early in the booking process to ensure insurance is in place before a storm affects their trip,” adds Moncrief.
“This benefit can provide full compensation if a flight is canceled or delayed due to weather conditions for a certain period of time, or if a particularly severe winter storm renders the traveler’s accommodation or home uninhabitable.”
Related: Benefits of buying travel insurance right after booking your trip
Flight delays due to lack of airline personnel
To avoid unpleasant surprises, check your policy for the very specific conditions that your travel delay insurance covers.
“Most travel insurance policies contain very specific language that states which airline-related issues can be covered by their benefits. Typical causes include mechanical failures, financial defaults, holidays, or weather conditions. Staff issues are rarely listed separately,” says Moncrief.
If your travel insurance doesn't cover the delay, you can get help from the airlines, Durazo says. “Scheduled flight cancellations in the United States usually either reserve you a seat on your airline's next available flight or give you a refund for the unused portion of your ticket,” he says.
“When a flight is canceled or delayed for reasons beyond the control of an airline, such as lack of crew, some airlines may issue a meal and/or hotel voucher to their passengers,” Durazo said. “However, these policies vary by airline and situation and do not offer the same level of coverage as trip cancellation insurance.”
Forbes Advisor rates airlines on the service they promise to provide after a flight is canceled or delayed due to circumstances within their control. American, Delta, JetBlue and United received the highest scores.
Insurance against loss of contact in case of breakage during the holidays
With a record high rate of flight cancellations, you may want to consider travel insurance for missed connections while on vacation if you have a multi-leg trip planned.
Missed vacation insurance can cover prepaid travel expenses that you lose because you missed your vacation and missed your destination. You may also be entitled to a refund of additional shipping costs you paid to get to your trips.
Reporting missed matches can help you in some situations, but not all, so it's wise to know the basics:
- Some basic travel insurance plans do not include missed connection coverage, some only offer it for cruises and tours, and some offer it as part of the benefits for flights, cruises and tours.
- Some of the plans offered may only cover a missed connection due to bad weather.
- Some of the plans that cover missed connections for flights only cover those due to "normal traffic delays".
InsureMyTrip spokesperson Megan Walch says missed connections coverage varies by policy and company. Some may offer missed call coverage for "your regular carrier's officially documented delays", which may include staff shortages, while others may be limited to weather-related delay coverage only.
The most important thing you can do to better prepare, he says, is get supporting documentation from your airline to support future claims.
Like travel delay insurance, missed transfer coverage only applies in the circumstances specified in your policy, and coverage limitations and required waiting periods apply.
“If you miss your flight while watching a big game in the airport lounge, you will have to work with the airline to arrange alternative travel arrangements at your own expense,” Durazo warns.
Blues Traveler: Vacation Cancellation Insurance
If you had to cut your holiday trip short and return home early due to an emergency, trip disruption insurance can help cover your return journey. Benefits may include the cost of a one-way round-trip economy ticket, as well as any savings you forfeit due to early departure. This is useful because last minute flights are in high demand, especially during holidays, and can be expensive.
Travel insurance "Interruption for any reason"
Some travel insurance companies offer travel interruption for any reason (IFAR) insurance that allows you to return home early for any reason. It offers a 75% refund on prepaid travel expenses that are normally non-refundable. Please note that IFAR benefits generally do not apply until at least 48 or 72 hours have passed since travel – check the required period on your policy.
Travel and emergency evacuation insurance
If you are going on vacation outside of the US, it is very important to have health insurance. Your national health insurance probably does not offer or offers very limited overseas health coverage.
To find out about benefits available worldwide, check with your health insurance company before you travel.
Also, Medicare is not accepted outside of the US. This means that the best insurance for seniors includes health insurance.
“Usually you don’t even consider these risks, and while it’s important to protect your financial investment in travel, you shouldn’t lose sight of the risks of an unexpected medical incident or emergency abroad,” GeoBlue spokesman Don Van Shiok said.
Travel health insurance covers medical and hospital expenses, medicines, laboratory tests, and x-rays if you become ill or fall ill while traveling under your policy.
It is also wise to have medical insurance in case of evacuation. Medical evacuations can cost tens of thousands of dollars and are not usually covered by U.S. health insurance plans, Van Shiok said. However, care and evacuation costs will be considered paid on the network, he said, and you will often have to pay up front and then request a refund.
“Many international healthcare providers require prepayment before they start treating a foreign patient. For these reasons, you must ensure that you have adequate health insurance when traveling abroad. Travel medical plans provide coverage and benefits that are not normally included in a home health plan,” he says.
Luggage insurance for vacationers
If you're celebrating New Year's in Paris and your luggage thinks it's best to celebrate in Berlin, luggage insurance can help financially.
AIG Travel spokesman Scott Adamsky said, for example, that AIG Travel's policy includes benefits that provide compensation up to a certain amount in case your luggage or personal effects are lost, damaged or stolen.
“The maximum baggage allowance under our luxury travel insurance plan is $2,500, which means we will pay that amount for a covered claim.”
However, it's important to note that while the total limit is $2,500, Adamski says there are limits for each item. “In the Deluxe plan, it's $500 per covered item, and after that, additional covered items are capped at $250. There may be additional specific restrictions for certain baggage contents (such as jewelry and electronics) and it is important to review these details in your policy."
Please note that there are exceptions to baggage insurance – for example, in case of loss or theft, cash is usually not returned. Also, keep in mind that you are being paid for depreciation, so this may not be the amount you should replace with a new one.
Baggage delay benefits are useful if your luggage arrives at your destination later than the time specified on your policy. With this coverage, you can get your entertainment money back before your luggage arrives.
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