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TOP THINGS TO CONSIDER WITH TRAVEL INSURANCE

If you plan to go abroad, even on a day trip to the United States, you should purchase the best travel insurance you can afford before you leave Canada. Your travel insurance should include health, life and disability coverage that will help you avoid large expenses, such as the cost of hospitalization or medical treatment outside Canada. If you are flying, being insured for flight cancellation, trip interruption, lost luggage and document replacement will save you from major disruptions and additional costs. If you are travelling by car, make sure you have driver and vehicle coverage in case you have an accident abroad.

Why you need travel insurance? Your Canadian insurance is almost certainly not valid outside Canada. Your provincial or territorial health plan may cover nothing or only a very small portion of the costs if you get sick or are injured while abroad.  Hospitals and clinics in some countries have been known to refuse to treat patients who become ill or who have had an accident and who do not have adequate travel health insurance or the money to pay their bills. You could face years of debt paying off the costs of treatment for an illness or accident you suffered abroad. The Government of Canada will not pay your medical bills.

During a short vacation on a Caribbean island, a Canadian developed a severe form of pneumonia and had to be admitted to hospital. His health deteriorated, and he was transferred to intensive care and placed on a breathing machine for more than a month. Without insurance, he had to make arrangements with the hospital to pay a bill that amounted to more than $20,000.

You can purchase travel insurance through your travel agent, insurance broker or your employer’s insurance provider. Your credit card company may also offer travel and health insurance. Regardless of how you obtain travel insurance, it is very important that you understand the eligibility requirements, terms and conditions, limitations, restrictions and exclusions of the policy.

Young travelers may think they don’t need insurance because they’re young and healthy. But accidents do happen. While walking along a beach on a Caribbean island, a Canadian tourist in her early 20s had an accident that seriously damaged her spine. Her family had to raise funds to pay for her medical evacuation.

Travel advisories and insurance policies

No matter where in the world you intend to travel, make sure you check the Travel Advice and Advisories twice, once when you are planning your trip and again shortly before you leave. If a Travel Advisory is issued for your destination, after you make your travel arrangements but before or during your trip, it may affect your travel health insurance or trigger your trip cancellation insurance. Make sure you understand any terms and conditions in the policy in regard to travel advice and advisories from the Government of Canada.

Some insurance companies will not honor medical claims made for injuries suffered in a country for which the Government of Canada has issued an official Travel Advisory. Coverage for injuries resulting from war may also be limited. Insurance policies often have exclusion clauses stipulating regions and/or activities that will not be covered.

How does the travel insurance work?

Travel insurance is available for a wide variety of concerns, from delays or cancellation of your trip to medical and evacuation services. Frequently, travelers who are looking for plans end up buying comprehensive travel insurance plans.

Travel insurance is a safety net that you can purchase to help you protect your travel investment in case of unexpected events that have a negative impact on your travel plans. It works quite similarly to other insurance policies in the following ways:

  1. Purchase travel insurance before anything actually happens to disrupt your trip. Once the event has occurred, like an act of terrorism, illness or severe weather, you can no longer purchase a plan to cover that or any related events.
  2. Read the chosen plan carefully before buying it. You’ll want to understand exactly what your insurance company will cover and what they won’t.
  3. Provide documentation of your issue while filing a claim. This documentation could be a medical bill, statement from the airline or a flight schedule depending on the situation.
  4. Pay your own costs up-front (most likely). Travel insurance primarily works in a reimbursement structure. You will get reimbursed from the travel insurance company if they approve your claim.

Travel insurance is available for a wide variety of concerns, from delays or cancellation of your trip to medical and evacuation services. Frequently, travelers who are looking for plans end up buying comprehensive travel insurance plans. The right comprehensive plan can provide coverage for a number of things and will include varying levels of coverage for trip cancellation and interruption, some baggage loss and medical emergencies. Some will also offer additional or optional coverage such as a waiver of pre-existing conditions, accidental death or the Cancel for Any Reason benefit.

Selecting travel health insurance

Carefully research your needs and verify the terms, conditions, limitations, exclusions and requirements of your insurance policy before you leave Canada.

When assessing a travel health insurance plan, you should ask a lot of questions. Does the plan provide continuous coverage for the duration of your stay abroad and after you return? Does it offer coverage that is renewable from abroad and for the maximum period of stay? Does the company have an in-house, worldwide, 24-hour/7-day emergency contact number in English and/or translation services for health care providers in your destination country? Does it pay for foreign hospitalization for illness or injury and related medical costs and provide up-front payment of bills or cash advances, so you don’t have to pay out of your own pocket?

Be sure to ask whether the plan covers pre-existing medical conditions. Ask the company to explain the definition, limitations and restrictions of any pre-existing conditions and tests and treatments you may have undergone.

  • Make sure you get a written agreement that your pre-existing medical condition is covered, or you could find your claim “null and void” under a pre-existing condition clause.
  • Be aware that the agreement must also include a stability clause stating that for you to be covered for any pre-existing medical conditions you must have no changes to or new medical conditions, symptoms or medications during the stability period prior to your trip.
  • The agreement should include a compassion clause stating that an inaccurate statement may not invalidate the entire policy, and a change of health clause.

And ensure that the plan provides for medical evacuation to Canada or the nearest location with appropriate medical care and pays for a medical escort (health care provider) to accompany you to and from your destination.

Ensure that deductible costs are clearly explained in the plan. Plans with 100-percent coverage are more expensive but may save money in the long run. The plan could cover health care provider visits and prescription medicines, or emergency dental care or emergency transportation, such as ambulance services. Check whether it excludes or significantly limits coverage for certain regions or countries you may visit.

Finally, ensure that the plan covers the preparation and return of your remains to Canada if you die abroad.

Gabrielle had insurance that lapsed three weeks before she was involved in an accident. Her Canadian family had to raise $300,000 over a three-day period to cover the costs of medical treatment and evacuation. Fortunately, she survived, but her family is left with a hefty debt to repay.

What does the travel insurance cover?

Most travel insurance plans are package plans that include various coverage like trip cancellation, trip interruption, trip delay, lost or delayed baggage, medical coverage, medical evacuation etc.

  • You, your companion or a family member has a medical emergency or dies
  • You need emergency transportation / evacuation
  • You’re laid off from your job of at least 1 years’ employment
  • Your travel supplier unexpectedly ceases operation
  • Bad weather
  • Lost, stolen or damaged luggage
  • Your trip is delayed, cancelled or interrupted due to an unexpected strike.
  • A city you’re visiting has a terrorist incident
  • Cruise ship sicknesses
  • A plane crash

Is it mandatory to have travel insurance?

Sometimes it’s not just a good idea but it’s actually mandatory. To travel to Cuba, you’re required to have travel insurance that includes medical coverage.  At minimum, they require you to have medical coverage, and recommend additional coverage like trip cancellation and personal liability.

Coming to Canada, here is an article on whether you should have insurance.  No, medical insurance is only mandatory for the supervisa and not for regular TRV’s.

How does trip cancellation insurance work?

Nearly all the same reasons you would cancel your trip are covered as a trip interruption. Travel Insurance reimburses you the unused value of your trip plus pays the cost of one-way airfare up to the plan’s limit. Emergency Medical & Evacuation coverage: You get hurt (ie – hit by a cement truck) or sick on your trip.

How much is travel insurance?

In general, you should expect a plan will cost anywhere from 4%-10% of your total pre-paid, nonrefundable trip cost. For example, if you purchased a trip with a total cost of $5,000, travel insurance policies available to you will likely range in price from $250-$500, depending on variables.

Travel insurance is not one-size-fits-all, so the price and conditions of a plan will vary. However, it may be useful to understand pricing guidelines to plan for your travel insurance purchase.

In general, you should expect a plan will cost anywhere from 4%-10% of your total pre-paid, nonrefundable trip cost. For example, if you purchased a trip with a total cost of $5,000, travel insurance policies available to you will likely range in price from $250-$500, depending on variables.

The providers will use a few pieces of personal information, other than the cost of your trip, to calculate the cost of a plan:

  • Age of the travelers
  • Number of travelers
  • Length of travel
  • Type of coverage

The age of the travelers is considered one of the most important of the four factors. Typically, a traveler that is over the age of 65 can expected increased rates. If you are traveling with minors, you may be able to add them to the plan at no additional cost, or at a lower rate – depending on the travel insurance company.

The number of travelers and length of travel can often increase the rates on the plans. This is because with more variables, there is more risk attached to the plan. For instance, if you are traveling overseas for 21 days, as opposed to only seven, you are opening yourself up to more medical risks and risk of travel interruption. These are both reasons to use your plan. The same can be said if you are traveling with four to five people, as opposed to just two.

The type of coverage you choose will also change the rate. A basic, no-frills comprehensive plan will naturally cost less than one that includes a myriad of optional benefits like Cancel for Any Reason or rental car collision coverage. Similarly, higher coverage limits for medical expenses or medical evacuation will increase the rate over a plan with lower amounts of coverage.

The Right Travel Insurance Plan

The plan rate should not deter you from purchasing the coverage that you feel you need to fully protect your trip.  The kind of protection needed by a traveler who intends to hike the Himalayas, for example, is vastly different from that needed by a family taking a short cruise to the Bahamas.

It’s not only important to compare travel insurance rates, but also coverage. This will ensure you are finding the right travel insurance plan for your trip. It can be helpful to compare travel insurance plans that offer you similar levels of coverage and are appropriate for your needs. Don’t be swayed by a lower-priced plan with benefits that don’t suit you completely; or, likewise, high-priced plans that over insure your trip.

Meeting the terms of your insurance policy

It is your responsibility to know and understand the terms of your insurance policy. Read the fine print carefully and ask for help, if necessary, to fully understand the eligibility requirements and definitions, terms, conditions, limitations and exclusions of the policy.

The information you provide must be accurate and complete. If you have any questions about the application and your medical history, including prescription drugs, tests and other treatments, contact the insurance company and ask them to clarify the issue in writing.

Obtain approval from your insurer before undergoing medical treatment. Routine health checkups, non-emergency care and cosmetic surgery are rarely covered by travel health insurance. Insurance companies may also exclude coverage for mental health disorders, drug- or alcohol-related incidents, or extreme sporting activities such as bungee jumping and rock climbing.

Get a detailed report and invoice from the doctor or hospital before leaving the country where you have received medical treatment. There is nothing more frustrating than trying to get the proper paperwork from thousands of kilometers away. Always remember to submit the original receipts for medical services or prescriptions received abroad. Keep a copy of the documents for your files.

Carry details of your insurance policy and tell your travel agent, a travel companion, and a friend or relative at home how to contact your insurer.

Safe Journeys from Guide Me Away!

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