Travel Insurance: Extras and Exclusions that Will Affect Your Clients

Additional types of coverage available on top of travel medical insurance can double the cost of coverage, and boost your sales revenue. But it may also add potential pitfalls as you strive to satisfy clients.

Each type of optional coverage could have its own list of policy exclusions, beyond the obvious exclusion that follows a government advisory to ‘avoid all travel’ to a particular part of the world.

So it’s important to ask clients how much they will be spending while away, where they will be going, where they will be staying, and what they will be doing and packing. All of these details matter when it comes to choosing extra coverage.

Trip cancellation and interruption insurance, for example, is generally designed to reimburse a traveller for prepaid expenses for commercial transportation, accommodation, and activities.

While all insurance plans have a long list of insurable reasons for recovering those prepaid costs, the Manulife Global Travel Insurance is a rarity because it will insure half of prepaid expenses if policyholders simply change their minds, provided they do so at least 14 days before their scheduled departure.


That Florida condo rental

Most—but not all—plans would be unsuitable for a person who has prepaid their stay at a cottage, apartment, or bed and breakfast that is not licensed or legally authorized to provide travel accommodation. TuGo is a rare exception in this respect.

A TU official has confirmed the following to Ingle International:

“We don’t specify the type of accommodations that can be covered under trip cancellation. So, as long as they are commercial accommodations where they have an invoice and/or receipt that shows the cost paid, the name the reservation is under and the dates booked, they can have that as a covered travel arrangement.”


Flying easy

For as little as $15 per person, flight and travel accident insurance will top up a traveller’s personal life and disability insurance, regardless of age. This option may have more appeal in the wake of the disappearance of Malaysia Airlines Flight MH370, and the recounting of other airline disasters.

Do, however, remind your client that there will be a list of activities that would not be covered, such as hang gliding, mountain climbing, piloting an aircraft, abuse of drugs or alcohol, illegal activities, and travelling in areas affected by war or terrorism.


Low price, low limits

Coverage for loss or damage to baggage and possessions typically costs $15 to $20—far less than the deductible amount on one’s home insurance policy, which would also provide some coverage.

The shortcoming of this coverage is that it may not cover certain items, such as electronic devices used for work, aids for hearing or seeing, collector items, cash, or securities. The dollar limits on coverage is modest, or nil, if the traveller leaves the baggage unattended or fails to report a theft to police.

So remind your clients to pursue compensation from airlines, cruise lines, hotels, or other parties who could be held responsible for the loss. It could also help to contact customer service early, as it may be possible to have luggage forwarded to a new destination. (See Maureen’s tale.)

Anyone who values sensible and well-informed advice is more likely to be a repeat customer. So that’s good news for you and your clients!


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