Tips for Buying Travel Insurance

April 9, 2019

With Spring Break on the horizon, many families are hustling to pack their bags, load up the family mini-van, and get out of Dodge for the week. And if they’re really in a hurry to escape the never-ending Midwest winter, hopping on the first flights out to the beach.

With all of the planning that goes into a family trip, oftentimes the decision on whether or not you should consider purchasing travel insurance is overlooked. Below are some general guidelines as to when it may or may not make sense to do so.

When you can Pass on it:

  • Domestic Travel: If you’re traveling in the U.S., these trips are typically less expensive than an international vacation and usually haven’t been planned as far in advance. There shouldn’t be concerns with medical care either, as most insurance carriers will cover you in case of an emergency in another state.
  • Current Travel Coverage: Before doubling up on travel insurance, check with your credit card and car insurance providers. Many travel credit cards offer coverage as a perk to their cardholders, and you may already have rental car coverage under your current auto insurance.
  • Low Cost Trip: If the trip is relatively low-cost and you can afford to lose out on some of the pre-paid expenses, you can probably pass on the coverage. This just means that you’re willing to take on the small risk in the event something goes wrong.

When you Should Consider it:

  • International Travel: International vacations on average are higher cost than the U.S trips. If you’re concerned about the loss of significant pre-paid expenses on your family’s trip, insurance is a viable solution. The most common concern among travelers is medical emergencies. Comprehensive travel insurance packages can include coverage on medical costs and emergency transportation.
  • Expensive Personal Items: Depending on what items you plan to bring (Laptops, cameras, tablets), theft may be a concern for you. While most personal items are typically covered under your current homeowner’s or renter’s insurance policies, your deductible will still apply. In the instance where an item’s value is below your deductible payment, you will be liable for the replacement cost.

While there are many other factors to include when you’re considering purchasing travel insurance, the points above are a good baseline to start with. If you have concerns or need help reviewing your current coverage, reach out to your BDF team for assistance.

Sean Knoerzer is an Advisor at BDF where he enjoys digging deep into the details of a client’s financial plan. He sits on the firm’s Financial Planning Committee, which is responsible for educating the BDF team on financial planning topics and improving the team’s planning process. He earned a Bachelor of Science in Agriculture and Consumer Economics with a concentration in Financial Planning at the University of Illinois.  Sean is a CERTIFIED FINANCIAL PLANNER™ professional.