Don’t Lose Non-Refundable Down Payments with Travel Insurance
Planning for that well-deserved vacation can be exciting – and expensive. Travel insurance can provide assurances your hard-earned money will not be lost if you must cancel your plans. But before you purchase any travel insurance plan, it is important to understand the mechanics of how to maximize the benefits of travel insurance.
Buy before the coverage is needed – This should be a no-brainer, but travel insurance needs to be purchased before you travel and you need the coverage. Just as you cannot buy automobile insurance after an accident, travel insurance companies will not offer coverage if you are already in need of the insurance benefits.
Make a trip payment first – You will not know for certain what your travel costs will be until you start making payments, including down payments. It is suggested purchasing travel insurance after you have made at least one payment toward your travel plans. This will help you determine the total cost of your trip and obtain adequate travel insurance limits.
Don’t wait too long to buy travel insurance – Although it is recommended to wait until you start making trip payments, there is a limited time after initial payments are made when travel insurance can be purchased. Most insurance companies require their travel insurance plans be purchased within 10-30 days after the first trip payment has been made.
Consider Cancel-For-Any-Reason coverage – Most travel insurance plans provide a list of covered reasons (perils) reimbursements will be made. But this could leave a gap in coverage and exclude certain scenarios that could cause you to cancel your trip. Adding Cancel-For-Any-Reason coverage will provide reimbursement up to 75% of your travel costs for any reason you cancel within 48-72 hours before departure.
Know all your costs – Eligibility for coverage is dependent on the total cost of your trip. 100% of your travel costs must be insured for travel insurance to kick in should your travel plans get cancelled for reasons covered under your plan. You can also add additional costs to your coverage as you get closer to your departure date.
Like fire extinguishers, insurance policies are one of the few products we purchase and hope we never need to use. But when we do, we are glad they are there to protect us. Understanding how travel insurance policies work will provide peace of mind that your hard-earned money is protected if your planned trip is unfortunately cancelled.