Every year, many travelers rely on travel insurance policies to protect them around the world. In the unlikely event luggage is lost or stolen, or if a traveler is forced to cancel their planned trip, an insurance plan can assist when things go wrong. However, even the strongest trip insurance policies may not cover every conceivable situation.
From mistake fares to high-risk activities, you may be disappointed when your trip insurance claim is denied due to a loophole.
Before you think about purchasing travel insurance, it's important to know that these five common scenarios may not be covered.
Known by a number of names, "mistake" fares happen when tickets go on sale at exorbitantly low prices due to a system error. Many common carriers have faced this problem in recent months, including United Airlines and Singapore Airlines. In certain situations, travelers who try to ride on a "mistake" fare may find their tickets ultimately cancelled. Will your travel insurance plan cover your airline cancelling your ticket?
If the carrier cancels the "mistake" ticket and refunds your money, an insurance claim would be denied because there is no claim basis. Because you received a refund, trip cancellation insurance would not offer coverage. Therefore, most travel insurance policies will not cover a mistake ticket by itself - but may cover other expenses attached to your trip, including pre-paid reservations and event tickets.
Trip cancellation due to pollution
Many central Asian cities are known for more than their culture. Places like Beijing and New Delhi are developing a reputation for the brown skies overhead caused by pollution. Smog-filled airways are becoming such a concern that the State Department will begin measuring pollution in cities around the world.
If the government issues a pollution warning, can you cancel your trip?
While some medical expenses may be covered, you could be disappointed to discover that excessive pollution is not a covered reason for trip cancellation. Those who are concerned about pollution may consider adding Cancel for Any Reason benefits to their travel insurance policy. As an early purchase add-on benefit, Cancel for Any Reason allows you to cancel your trip prior to departure for any reason, and still receive a partial refund of your expenses.
Contact sports and high-risk activities while on vacation
Every traveler has a bucket list. Whether it's running with the bulls in Spain or cliff-diving in Mexico, everyone has something they want to try at least once. If you decide to live life to the fullest, will travel insurance cover you in the event of an emergency?
If you want to attempt a sport or other hazardous event - even mountain climbing - you need to make sure your activities are covered. Many insurance companies offer a specific hazardous activity add-on coverage that, when purchased, will cover many common high-risk activities.
Policies purchased after known events
This is a common scenario that affect travelers every year.
After booking your trip, a weather situation or other natural phenomenon has the potential to ruin your vacation. From named winter storms to identified hurricanes, a natural disaster can sideline a trip very quickly. If you buy a policy after a major incident, will travel insurance cover you if it happens again?
Once a storm is named or a natural event is identified, this often becomes a "known event." As a result, travel insurance purchased after the "known event" is declared may not offer coverage for cancelled or delayed trips that are directly caused by the event. If you are concerned about traveling at the height of hurricane season or in the heart of winter, buy your insurance policy early to ensure you are covered.
Traveling within your home country
Something you may have never considered is how travel insurance can help you while staying inside your home country.
If you buy a travel insurance policy for a domestic trip, will you be able to file a claim if things go awry?
Though certain travel insurance policies will cover you if you are 100 miles away from home, most trip insurance plans will only cover medical costs when visiting another country. However, other benefits - including trip delay and baggage loss - may still be in effect as long as you are far enough away from home. Before purchasing a travel insurance policy, be sure to understand what benefits are applicable while in your home country.
While travel insurance policies assist many individuals around the world every year, there are some situations where holding a plan simply isn't enough. By understanding what situations are not covered by travel insurance, travelers can make the best plans when organizing their next journey.