Even the best-laid plans for a weekend jaunt to a neighboring state can get derailed by an illness or a medical emergency. If you’re going on an overseas cruise or tour, the stakes are much higher. Let’s say that some medical problem forces you to cancel your journey…or you get sick or injured while you’re away. You stand to lose a lot of money in prepaid tour costs or medical expenses while you’re abroad. What to consider in overseas travel insurance…
• Find out what you have—and if you need more. If you’re planning an overseas trip, call your current health insurer to see if your policy covers any overseas medical costs. Some do, including a few Medicare supplement policies (Medicare itself does not). But even if your carrier does provide some coverage, it will usually be limited and almost never pay the overseas hospital or doctor directly—you must pay first and then submit your bills for reimbursement when you return. Rule of thumb: If you’re prepaying all or part of an overseas trip and/or if you have a medical condition that could flare up before or during your travels, it’s wise to consider getting travel medical insurance. Good news: If you have health insurance, medical travel insurance is usually not needed for domestic travel.
• Know your options. Most people don’t realize what types of travel insurance are available for medical issues. The main ones include: Flight insurance, which is simply a life insurance policy that pays if the plane crashes. Evacuation coverage kicks in if you are injured or become ill while traveling and need to be moved to a distant hospital or even brought home for appropriate care—this type of evacuation is expensive (possibly running as much as $100,000 or more). Cancellation and interruption insurance pays you back if your trip is cancelled by the tour company (some travel or tour companies go bankrupt and don’t offer refunds) or if you or a traveling companion (who is also insured) gets sick or injured and cannot start or continue your trip. Medical travel insurance, depending on the type of policy you buy, either pays all or part of any medical expenses you incur while traveling. Insider tip: In recent years, some of the biggest travel insurance companies, such as Travel Guard and Travelex, began offering comprehensive plans that act as your primary insurer while traveling. Such plans may also include medical evacuation and cancellation/interruption coverage.
• Learn the going rates. You can expect to spend from 5% to 10% of the total cost of your trip for insurance premiums. Insider tip: Be sure that the insurer is licensed to sell in your state. If not, any claims you later submit will not be honored. And steer clear of insurance offered by travel agents—they usually offer only one company’s plans from whom they get a hefty commission. Instead, search online for a travel insurance broker, such as InsureMyTrip.com, which represents more than 20 companies. Important: If you are traveling to a country on the US State Department’s at-risk list (Travel.State.gov), your policy will likely not be honored. Check that list before you buy any type of medical travel insurance.