Airport Security Travel Tips
TRAVEL INSURANCE TAKES ON NEW ROLE
By Peter S. Greenberg, the NBC "Today" Show Travel Editor

One of the new packing essentials since Sept. 11 is travel insurance. Currently, only about 16 percent of U.S. travelers buy it each year, but the number is growing rapidly. But what kind to buy? How much do you want to pay for it? And last but never least, what does it really cover when you’re away from home? Or sometimes, what does it cover before you ever leave home?

LET’S START with the bad news: travel insurance can be the most overpriced of all travel services. But it’s an essential investment. Most travel insurance covers one or two dangers:

  • Losses from trip cancellations. Cruise lines, package tours and airline tickets normally require full payment in advance. And for cruises and package tours, those payments are often demanded months in advance. If you are forced to cancel your trip two months before departure, chances are you won’t pay much of a penalty. But any cancellation within 60 days could cause you to forfeit your entire payment. And should you have to cancel your trip during your journey, you not only lose your money, but the cost of getting you back home is often your responsibility.
  • Emergency medical care and transportation. If you have an accident or get sick while traveling, getting treatment may not be enough - you might need to be evacuated to an appropriate medical facility, perhaps in the U.S. The cost can be astronomical.

So, having said this, what type of coverage do you need?

UNNECESSARY COVERAGE
Well, let’s start with some coverage you probably don’t need:

  • Flight Insurance: It’s got one of the highest premiums going - and only covers you in the event the plane crashes. There are 25,000 flights every day in the U.S., and the odds of a crash are remote. Unless you know something the rest of us don’t, this is an unwise investment.
  • Rental-Car Coverage: Chances are your own automobile insurance policy already covers you. Check your own policy carefully before buying extra insurance you don’t need.
  • Baggage-Loss Insurance: Again, chances are your homeowner’s policy, and even some renter’s insurance policies, already cover this.

So, what do you really need?

  • Trip-Cancellation or Trip-Interruption Insurance: These policies reimburse you (or your heirs) in the event you get sick, suffer an injury, or even die, either before your departure or during your trip. Many policies will even cover you if that illness, injury, or death happens to a close family member and prevents you from taking or continuing your trip. Make sure your policy covers something called operator default. Without that coverage, your policy may be worthless if the cruise line fails, the airline goes bankrupt, or the tour operator liquidates before your scheduled departure. This is important insurance to have. But in recent months, a number of insurance companies have stopped selling these policies (precisely because so many companies have folded), and the companies that still offer the policies now have frequently changing lists of which cruise lines, tour operators they won’t cover. In many cases, however, you don’t necessarily need to go out and buy a separate policy. Pay with a credit card! If you purchase your trip with a major credit card, there is protection against supplier failure. Under the federal fair credit billing act, if you purchase a trip and it is cancelled within 60 days of that purchase and before you leave, you can dispute the charge and the credit card company is required to issue you a credit. Another important distinction: we’re talking here about credit cards, not debit cards. Right after Sept. 11, one cruise line, Renaissance, folded. Passengers who did not have insurance or who paid for their cruises with checks lost millions.
  • Medical Evacuation and Repatriation Insurance: This is perhaps the best policy to have. This insurance does exactly what it sounds like it does. If you get injured or sick while traveling, the policy pays to have you flown out of the area, and in some cases, home to the doctor and hospital of your choice. There is a high likelihood that your own medical insurance only covers you for some emergency treatment outside the continental U.S. - if it covers you at all. Recently, I was on a plane with a middle-aged man who had fallen and broken his hip on a Paris street corner. In order to fly him home, the commercial airline required him to buy four first class seats in order to place his stretcher. There was an additional cost for the nurse hired to accompany him. Airfare and other costs boosted the bill to more than $65,000.

KNOW WHAT YOU’RE BUYING
Some important caveats: There is travel insurance and there is travel protection, and there’s a big difference. Travel insurance is offered through third party companies that are licensed and approved by state governments. And travel protection is offered directly through the individual supplier - the cruise line or tour operator itself. My choice: travel insurance. Why would you want "protection" from the very company that might go out of business? In the event of a bankruptcy or operator default, you are not protected by "protection". These "protection plans" are designed to protect only the company and not the consumer. This is especially true with cruise lines. Most have draconian refund policies for passengers who cancel their cruises within 60 days of scheduled ship departure. And in the wake of Sept. 11, more and more passengers are buying the trip protection directly from the cruise line instead of from outside insurance companies. Consider the differences. At one major cruise line, if you buy the cruise line’s protection program and have to cancel your cruise, in some cases you only get a credit that you must use on a future cruise within one year - not a refund.

With medical evacuation insurance, you must read the fine print very carefully. With some policies, the insurance company retains the right to make the decision, using its own doctors, as to the extent of your injury and also makes the decision where the nearest appropriate medical facility is. With other policies, like Travelguard or Medjet, the company consults you or your own physician, and will evacuate you and repatriate you to the doctor and facility of your choice. This is an extremely important distinction. Both companies maintain 24 hour hotlines to handle emergencies worldwide.

WHAT IT COSTS
Trip cancellation or interruption insurance roughly costs a minimum of six percent of what you paid for a trip. And it, like life insurance, is often charged based on your age. For example, under Travel Guard if your trip costs $501 to $1000, insurance will run you $46 if you’re under 34, but up to $118 if you’re 85 or older.

Medical Evacuation Insurance: Medjet, for example, costs roughly $175 a year, and family memberships run $225. A great investment you hope you never have to use.

Peter S. Greenberg is the NBC "Today"show Travel Editor.