Toothbrush, Passport…Travel Insurance?

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Editor’s note: This is a guest post from Angie Picardo of NerdWallet

Sometimes the excitement surrounding a vacation trip could take our minds off the actual logistics. Few people look beyond booking airline tickets, hotel accommodations and other transportation. The “what ifs” aren’t fun to think about when packing up for a family vacation, but the only way to avoid a mishap is to be prepared.

Traveler’s insurance has been labeled as a scam, but with all of the new developments in travel these days, it’s worth taking a look. Some instances in which you’d benefit from traveler’s insurance are if a flight is canceled or you can’t make it, your passport is stolen, you need emergency medical assistance, or if there are hostile conditions in your destination.

When shopping for traveler’s insurance, you’ll find that your airline, cruise line, etc. will offer their own insurance package. It’s best to steer clear of these offers because in the event that the company, for example, goes bankrupt, you are no longer covered and won’t get your money back. Third party issuers are a better choice since they work independently from your travel line.

You may already be covered

But before you shop around, Visa, MasterCard, Discover and American Express offer their own individual coverage plans that you can use to supplement another insurance package if you so choose. So, booking your trip with your travel credit card offers more than discounts and rewards—it offers peace of mind. Make sure you read your card’s terms and agreements carefully, but here are a few highlights that make each one different.Visa gives you decent coverage with a minimum $250,000 of travel accident insurance. If a common carrier loses your bags, you’re eligible for a lost luggage reimbursement up to $3,000. They do offer travel and emergency assistance, but they emphasize that “all costs are your responsibility” and that they will go through “reasonable” efforts to assist you in the event of an emergency. That brings into question their definition of “reasonable,” so call to see what’s actually covered.MasterCard gives you up to $1,000,000 in travel accident insurance, but is very specific when determining just how much you’ll get. To get the full amount, you need to lose your life, two limbs, or sight in both eyes. If you lose your thumb and index finger on the same hand, you are entitled to a quarter of the amount, but if it’s different hands, you’re outta luck. And if you’re planning on an extended stay, note that MasterCard only covers you for trips less than 30 days.

Discover’s coverage is pretty bleak with $500,000 coverage for accidental loss of life (but not dismemberment), and offers a long list of referral services but no help paying for them. They can help you track your lost luggage or help you transfer money, which is helpful…unless you can’t pay for it.

American Express offers the most comprehensive and flexible coverage out of the four. They cover trips less than 365 days long, reimburse non-refundable expenses and unused accommodations, and make arrangements for you if you’re medically unable to travel. They also give you up to $750 in emergency dental coverage, and allow you to customize your plan with different benefits, and to increase your coverage.

Better Safe Than Sorry

Some types of insurance could be more expensive than they’re worth. For example, for a short business trip form SFO to LAX, you shouldn’t buy the same medical coverage you’d need if traveling to a developing country. With the right kind of travel insurance, you can rest assured that you’re covered when any of those “what ifs” come around on your vacation.

About author: Angie Picardo is a staff writer for NerdWallet, a credit card comparison website dedicated to helping jetsetters find the best travel credit card.

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