Travel insurance is no longer optional. After hundreds of thousands of travelers have lost deposits, tickets and non-refundable activities due to the coronavirus epidemic, it’s more or less mandatory. But how do you buy travel insurance after the pandemic?
“There are different covers that could be vital for travelers,” says Damian Tysdal, founder of Travel Insurance Review.
Almost half of Americans who canceled their trip after the pandemic have lost money, according to a new survey of ValuePenguin. The main offenders? Airlines and hotels. Average loss: $ 854 per person.
So how do you buy travel insurance after the pandemic? Very carefully, say the experts.
“When considering purchasing an insurance plan, travelers should ensure that they are covered for situations like COVID-19,” said Jeremy Murchland, president of Seven corners. “Travelers should also keep in mind that there are many other dangers associated with travel, particularly international travel, including injury and other types of illnesses outside of COVID-19.”
These are the two types of travel insurance you can purchase after the pandemic
If you are going to travel, it is not a question of whether you need insurance, but of what type.
- Travel insurance “Cancel for any reason”. It costs between 10% and 12% of the cost of your vacation, and it will reimburse part of your travel expenses if you decide to cancel.
- “Nominated risks” travel insurance. This is the most common type of travel insurance. It’s cheaper (7% to 9% of the cost of your trip), but as the name suggests, it only covers the perils mentioned in the policy. And a pandemic is probably not included.
“Travelers may have different travel insurance needs,” said Kasara Barto, spokesperson for Squaremouth.com, a travel insurance comparison site. For example, domestic travel is likely to rebound first, which means customers will look for policies that include cancellation coverage and little or no medical coverage. The reason? “Health insurance generally covers travelers to the United States,” she says.
How to purchase “Cancel for any reason” travel insurance
“Cancel for any reason” travel insurance is the star of the coronavirus pandemic. Although it is more expensive than standard “named perils” travel insurance, it is more flexible. Its main advantage is that if you change your mind about your trip, the policy guarantees that a minimum of 75% of your money will be refunded.
“There are, of course, 100% refunds for normal world miseries” covered by travel insurance policies, such as disruption or loss of luggage, according to Jonathan Breeze, CEO of AardvarkCompare. “The 75% cancellation” for whatever reason “simply constitutes an additional level of protection.”
AardvarkCompare has noted interest in “cancellation for any reason” policies, which increased from 5% to over 50% after the pandemic. In some countries, it already accounts for most travel insurance sales. For example, in Germany, Reiserücktrittsversicherung is the most popular type of insurance, according to Lum Kamishi, editor of travel insurance for Visaguide.World.
Many travel insurance companies have withdrawn their “cancellation for any reason” policies from the market due to recent concerns that trips tentatively scheduled for this summer will be canceled. But Dan Skilken, president of Tripinsurance.com, says they are still available from some insurance companies. “And they should return from other insurance companies after the travel market has calmed down,” he added.
What types of changes have insurers recently made? Cheryl Golden, Director of Marketing at InsureMyTrip, declare a few reduced reimbursement percentages. “But” canceling any reason “remains widely available to those who meet the eligibility requirements, and we are not aware of any price increases,” she adds.
PK Rao, president of INF Visitor Care, agrees. “Travelers should avoid canceling plans that have a history of withdrawal or limitation of coverage during pandemics – or at least be aware of these sudden changes that are possible by examining exclusions or policy wording.”
How to purchase “named perils” travel insurance
To find the best “peril named” travel insurance policy after the pandemic, look at the past, advises Sherry Sutton, vice president of marketing at International insured travel.
“Travelers should review their plans carefully, as always, but they should also take the time to review how the insurer has handled the current situation,” she said. “How did they communicate, what types of coverage changes did they make, were they flexible?”
The fact is that some travel insurance companies were better than others. The best insurers offered more coverage and went the extra mile to help clients. The worst part – and you can find them on complaints commissions – responded to complaints with arbitrary refusals.
Yes, some of the best insurance policies cost more. But you get what you pay for.
“Historically, there has been a lot of focus on price when purchasing a travel insurance plan,” says Sutton. “Although price should always be a consideration, I think COVID-19 will highlight the need to spend a little more to get the right coverage in the future.”
Stan Sandberg, co-founder of TravelInsurance.com, states after the outbreak, many travel providers have offered either full refunds or vouchers for future trips for “named perils” policies. “In either case, a traveler with a travel insurance policy has options,” he says.
Travel insurance after the pandemic focuses on health and money
So what should you look for in a post-pandemic travel insurance policy? Overall, the focus is more on health – and money.
“Travelers should continue to look for insurance policies for personal injury, illness or unexpected accidents,” said Rachel Coen, spokesperson for Travel insurance G1G. “In addition, this current pandemic highlights the need to protect travel costs. Millions of trips have been affected by global travel closures related to COVID-19, leaving travelers with the financial burden of canceled flights, reservations hotel and other non-reimbursable travel expenses. “
Pay attention to the reimbursement conditions. All travel insurance comes with a “free” period of between 10 and 14 days after the purchase of the policy.
“If you’ve been forced to cancel your trip and get a full refund of your travel expenses, you should be able to cancel your policy and get a full refund of your premium,” said Erin Fish, co-founder of goWanderwell.com, a travel insurance site. “If your trip has been postponed to a later date – sometimes even up to more than a year later – you should be able to ask your travel insurance company for a policy carryover migration to reflect the new travel dates. “
At least one thing has not changed regarding the purchase of travel insurance.
“Always read the fine print,” says Pamella Seay, who teaches law Florida Gulf Coast University in Fort Myers, Florida. “Examine the exclusions and determine what might not be covered.”
Pay close attention to how your insurance policy handles a “force majeure” or force majeure. Would the police cover such an event or would it be up to you to pay your expenses?
“Know the exact the terms of your agreement are important, “she adds.
What to look for in travel insurance after the pandemic
Medical problems. Chris Zimmel, a retired flight nurse, recommends studying the medical coverage provisions carefully. “Will you be covered only if you are treated at the local hospital?” she says. “Will this cover transportation to the nearest appropriate establishment, as defined by the insurance company, to the nearest hospital in the United States, or to your hometown? Do not assume not just that you will be transported to your local hospital. ” Also consider medical air travel and travel security membership through a company like Medjet.
A future pandemic. Generally, epidemics and pandemics are not covered. This is what Bahar Schmidt, founder of the luxury travel site Eluxit, discovered when she tried to purchase travel insurance in March. “I was buying flights during the early stages of the COVID-19 pandemic and I was considering adding travel insurance,” she said. “However, when I read the fine print, I realized that the policy offered by my airline did not explicitly cover pandemics.” Don’t bother trying; most major travel insurance companies no longer cover pandemics. Try a “cancel for any reason” policy if you want coverage.
Quarantines. How does travel insurance manage future quarantine? Few politicians deal with this, but Nate Hake, a former lawyer who travels frequently, expects insurance companies to answer this question soon. “Imagine that in six months a place like Thailand will reopen for tourism, but then experience an unexpected wave of infection and suddenly have to close in the short term,” he said. “The risk to insurers is quite significant in this situation, and it is reasonably likely to happen somewhere, so it will be interesting to see if travel insurers can find a way to offer quarantine insurance products affordable. “
What to expect after purchasing insurance
In the future, travel insurance will offer advantages that it did not have before. For example, processing claims will take less time – even if there is another pandemic. Businesses are deploying technologies and systems that process and resolve complaints faster than ever.
AT Allianz Tourist attractions, an initiative called SmartBenefits aims to pay customers in real time for eligible flight delays without having to submit receipts.
“SmartBenefits allows us to actively monitor customer thefts and, when we detect a significant delay, automatically file a complaint for this delay,” said Daniel Durazo, spokesperson for Allianz. “This innovation has really changed the way travel insurance works and, with a robust mobile app and 24-hour support, will be what travelers are looking for in travel insurance, in addition to coverage for cancellations and interruptions of travel, medical emergencies and luggage issues. “
So how do you buy travel insurance after the pandemic? If you buy a “named perils” policy for garden varieties, do your homework. But you will probably want to consider a “Cancel for any reason” policy. You’ll still have to read the fine print, but you’ll have peace of mind – and get paid faster.