Insuring Your Trip or Your Health?
Basically, travel medical policies insure your health, and trip cancellation policies insure your trip. To help you understand the primary differences between these two types of policies, we review the cost, the coverage, the exclusions and the target market for each type of policy.Travel Medical Insurance
The Cost. Travel medical insurance is relatively inexpensive insurance. Most travelers do not get sick or injured, and when they do, most medical bills are limited to a doctor visit or an outpatient hospital visit and maybe a prescription. Typically the price varies based on the overall amount of the coverage you purchase (usually from $50,000 to $1,000,000), the deductible associated with your plan (typically from $0 to $500), the overall benefits of the plan and the length of your trip. But in general, policies start as low as one dollar per day, or even less, and you can purchase as little as 5 days coverage, making travel medical insurance very affordable.What it Covers
Most travel medical insurance policies provide fairly comprehensive coverage for injuries or illnesses that occur while on your international trip, including:- Inpatient/Outpatient Care – if you are admitted to a hospital or treated and released
- Injuries/Illnesses – if you get hurt or sick while on your trip
- Doctor visits – including clinics and urgent care centers
- Prescriptions – if related to an injury or illness that occurs while on your trip
- Emergency Medical Evacuation/Repatriation – if you need to be evacuated to another location, or if your body
needs to be returned home
- Lost Luggage/Trip Interruption – although not as extensive as you would get with a trip cancellation policy, there is typically some benefit for lost luggage and some coverage if you need to go home to deal with an emergency, then resume your trip
What it Does Not Cover
Travel medical policies are not designed to provide permanent health insurance nor trip cancellation insurance, so there are a few key areas where coverage is not provided. If you have a pre-existing condition, want a regular check-up or immunization, need maternity coverage or want a refund for a lost deposit, you will be out of luck with most travel medical policies. Here’s a short list of the main categories of excluded items:- Preventative Care – checkups and immunizations are typically not covered
- Pre-Existing Conditions – some plans provide limited pre-existing condition coverage, like “acute onset of a pre-existing condition” up to a certain amount, but for the most part any existing condition or regular prescription you have will not be covered
- Pregnancy/Maternity, Mental Health – permanent or student policies typically cover these items, but travel medical policies will not
- Trip Cancellation Expenses – deposits on cruises, hotels, flights, etc. if you have to cancel your trip
Who is it for?
Students studying abroad, travelers on extended trips, business travelers and expats are all appropriate purchasers of travel medical insurance, and typically these categories of travelers would not consider trip cancellation insurance.Trip Cancellation Insurance (Travel Insurance)
The Cost. Trip cancellation insurance is relatively expensive, and the price varies primarily based on the overall cost of the trip itself. So if you plan to take your family on a two-week cruise that costs $20,000, expect to pay $400 to $800 or more for comprehensive trip cancellation insurance; travel medical insurance would cost roughly $60 to $80 for the same trip.What it Covers
The most important part of a trip cancellation policy is the section of the policy that deals with what events permit you to cancel your trip and receive benefits. Although “cancel for any reason” provisions have recently become popular, they are very expensive and not standard on most policies. This means you must cancel the trip for an approved reason to receive the coverage. The most common reason is sickness or injury, or a traveling companion that actually prevents you from traveling, as certified by a doctor. Other reasons include death, natural disaster, strikes, terrorism, accident while en route to the airport – and in each case, it must prevent you from traveling on your dates. If you cancel your trip for an approved reason, then you can file claims for any amounts that you have spent on the trip that are not refunded by the airline, hotel, cruise operator, etc. In addition to this primary cancellation coverage, most trip cancellation policies also include some of the following:- Emergency medical coverage – like a travel medical policy, but often not quite as comprehensive.
- Trip interruption, trip delay, lost baggage, delayed baggage, missed connection – and other travel incidentals
- Emergency medical evacuation and repatriation – just like a travel medical policy
What is not covered?
Most importantly, the trip cancellation coverage is not available if you cancel your trip for a reason that is not approved. For instance, if you have to move your vacation dates for school or work reasons, or if you don’t have the funds you need for the trip, or if you get sick but recover before it’s time to travel, or if your girlfriend gets sick but she wasn’t traveling with you, or if you just change your mind – unless you purchase a policy with “cancel for any reason” protection, there are a lot of valid reasons to change or cancel a trip that will not be covered by a typical policy.Although in general the medical coverage included in a trip cancellation policy is not as comprehensive as you get with a travel medical policy, often trip cancellation policies can provide better coverage for people with pre-existing conditions.
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