Thursday, December 10, 2015

Travel Insurance-Ripoff or Necessity?

I would like to share several things that have happened in my professional experience that argue for the necessity of trip insurance.

I always, I repeat, ALWAYS, encourage my clients to insure their travel investment with insurance.  Most will purchase it, once I assure them that it is in their best interest to do so.  But of course, there is always that stubborn few, that refuse to do so, stating that they are going, no matter what and insurance is a waste of money.  The problem is that despite the best planning, life often gets in the way.

One of my all time favorite clients, a retired police officer, booked his wife's dream vacation to Paris,as a surprise for their anniversary.  He refused to take the insurance because he felt is was an unnecessary expense.  His wife was excited beyond words and we spent literally hours on the phone, planning every little detail to fulfill all the things on her bucket list.  Two weeks prior to departure, he had a heart attack while mowing the lawn.  Thankfully, he survived the attack but required open heart surgery and was told by his doctor, in no uncertain terms, that he could not travel to Paris.  Of course, everything was nonrefundable and this couple could ill afford the loss of thousands of dollars.  They called me just frantic and asked if there was any thing at all that I could do for them.  I resisted the huge temptation to say, "I told you so"  and told them that I would do the best that I could.  Of course, the airlines would not budge on the airline tickets, so they were looking at huge change fees to use them in the future.  But thanks to my good relationship with the tour company involved we were able to negotiate travel at a later date with just a small penalty.  If they had purchased the trip insurance, they would have been covered for every cent that they had invested and it would have involved a phone call, a doctor's note and a claim form.  It was a very expensive lesson for my client.  The good news, is that he fully recovered and they went to Paris as planned, this time with insurance, and a wonderful picture of her dancing in the Hall of Mirrors at Versailles, hangs in my office to this day.  

Another classic example, my clients were stuck in Disney World because of Hurricane Sandy.  They called me just frantic when all flights were cancelled into Philadelphia on the day of their return.  As you can well imagine, this was a very tough day for me and I was putting out fires everywhere.  When I answered the phone, he was very upset and was practically yelling at me.  I told him how fortunate he was to be riding out the storm in Disney with his wife and kids because I had clients in much worse places.  I reminded him that the travel insurance that he had purchased would reimburse him for his trip delay.  I told him to go back to the park and enjoy his extended vacation and to save all of his receipts.  He laughed and thanked me for encouraging him to buy the insurance.  Upon his return, we filed the claim, attached the receipts and the insurance company refunded every cent.  Instead of a really bad experience, he could relax and enjoy time with his kids. 

Most people do not understand that travel insurance not only covers trip cancellation but it also covers trip delay, trip interruption, baggage loss or delay and medical insurance (some medical insurance companies will not cover you when traveling abroad so you should always check before departure).  I once had a client on Medicare (which does not cover medical outside of this country), fall and break his leg in Europe.  Thankfully, he too, had purchased the insurance on my recommendation.  Again, a phone call, a claim form with receipts and another happy reimbursed client.  

There are many more examples that I could cite, a death in the family, an automobile accident on the way to the airport, I even had one client whose employer cancelled all vacations, these are just a few things that can and do happen.  Insurance covered all of these scenarios.  

On a more sobering note, with all of the scary things happening in the world today, insurance may be more important than ever.  Check the fine print with your travel agent regarding terrorist acts.  Some companies cover it, others do not.  A really good option is the Cancel for any Reason policies, but for some, this may be cost prohibitive.  Just educate yourself and get the policy that works best for you.

I hope these concrete  real life examples help to convince you that travel insurance works very well when the need arises.  Life is complicated, we can't predict the future and if you are making a significant investment, you should protect it.  

Until next time, safe travels.